So, What is a Charge-Off?
When a Collection Agency Cannot Collect
Since there is a limited amount of time that a collection agency can collect on a charged-off debt, it is important to speak with your attorney about any contact you have had with a collection agency. Every state has its own statute of limitations, or time limit, on when they can collect on a charged-off debt. “In California, most credit card companies and their debt collectors have only four years to do so (NOLO).” Once the statute of limitations has passed, you are no longer legally liable for paying the charged-off debt. This will apply to both personal and business debt. There are serious repercussions for not appearing in court if you have been served on a debt. The court will rule against you if you do not appear to say that the debt has expired.
Charged Off Debt During Bankruptcy
Regardless of the chapter under which you file for bankruptcy, you will be required to provide the court and trustee with financial accounting. You will include all the debts that appear on your credit report, including ones marked as charged-off. If you do not list charged-off debts, there is a possibility that they will not be discharged in your bankruptcy. Speak with your attorney in detail about your finances and debt before filing to ensure that your debt is properly addressed in your bankruptcy case.
Need More Information?
At the Law Office of Daniela Romero, we believe in relationships that are based on trust. Before we work together, we would like to get to know you and we would like you to get to know us. We want you to be sure you are the right fit for us and that we are the perfect fit for you. This will allow you to be completely comfortable sharing intimate and difficult details of your case, so we can offer you representation to the fullest extent of the law. Call us today to set up a free consultation.