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Should you file bankruptcy if most of your debt has been charged off? |
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Filing bankruptcy
I may be wrong on this, but my understanding is that "charged off" simply means the creditor has written the debt off (as in written it off as a loss on their taxes, or turned it into their insurance company as a bad debt, etc.) but in no way affects the collectability of the debt. I suspect if they later collect on a charged off debt, they have to claim the money they receive as income on their taxes since they wrote it off earlier. I may be wrong about this though... I definitely don't think that "charged off" means "forgiven," though. Please note that nothing in this posting or in any other posting constitutes legal advice; this is simply my understanding of the facts, which I do not warrant, and I am not suggesting any course of action or inaction to any person.
More input from FAQ Farmers:
- I had a charge off about four years ago for $16000..Started to get harassed by a law firm who bought the charge off and sued me in court...They got a judgement against me and then tried to go after me with a lien until I filed for Chapter 7 ...Then all proceedings are frozen ...
First answer by Angel Strojny. Last edit by Shayne54. Contributor trust: 1 [recommend contributor]. Question popularity: 232 [recommend question]
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