If you haven’t paid your credit cards or any other debts for approximately nine months then your credit card company or whatever creditor you have will charge off your debt. What charge off means is somewhat misleading . When a creditor charges off debt they are really doing one of the following things:
Write Off the Debt –
Once a creditor charges off your debt they can simply write off the debt as “bad debt.” When a creditor writes off your debt as bad debt what they are basically saying is that the debt is uncollectable and that they would rather get a small tax break on the bad debt, rather than continue spending money attempting to collect it. Once a debt has been written off then the debtor will no longer be responsible for it. Too good to be true right? Well the fact of the matter is VERY few debts are ever written off as bad debt. Typically only small debts, usually from small a small medical practice will ever be written off as bad debt.
3rd Party Collections –
A creditor can send your charged off debt to a 3rd party collections agency, which basically means they are selling your debt for pennies on the dollar to someone. Once your charged off debt is sold to a 3rd party collections agency prepare to be bombarded with phone calls to your home, your work, your neighbors and finally your friends and family.
Turned over to an Attorney –
A creditor can turn over your charged off debt to an attorney. When the debt is turned over to an attorney the attorney will begin by filing a demand letter. Failure to make a payment arrangement based on the demand letter will lead the attorney to file a lawsuit against you and potentially garnishing your wages, levy your property, or even freeze your bank account.
DON’T WORRY, if your debt has been charged off you can still file for bankruptcy.
If your debt has been charged off by your credit card company and you would like to speak with a bankruptcy attorney regarding your options then please contact Shmucher Law, PL at 954.309.5559 or 305.741.5553. We offer free consultations in any of our Bankruptcy Law office locations in Boca Raton, Fort Lauderdale, Miami, Plantation, and Sunrise Florida.