What is a Charge Off on Your Credit Report?

A charge-off is a debt that is deemed uncollectible by the original creditor and is subsequently written off. Charge-offs are classified as bad debts on the creditor’s income statement and are removed from the balance sheet. When a creditor charges-off your account, it’s declaring your debt as a loss for the company. The creditor then usually sells or assigns the bad debt to a collection agency.


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