A charge-off doesn’t mean the debt is gone. Understanding the process helps you decide what to do next.
Quick summary
- A charge-off is when a lender writes off a debt as a loss, usually after about six months of missed payments.
- You still owe a charged-off debt, and it may be sold or passed to a collection agency.
- Charge-offs and collections can stay on your credit report for seven years from the original delinquency.
- Newer scoring models ignore paid collections, but many lenders still use older versions.
When payments stop for several months, a lender may stop expecting repayment through normal billing. That’s a charge-off. Collection activity often follows.
What a charge-off is
A charge-off is an accounting step: the lender writes the debt off as a loss. Credit card issuers typically do this after about 180 days of missed payments. The debt doesn’t disappear. The lender may keep trying to collect, hire a collection agency or sell the debt to a debt buyer.
What collections are
When a debt is passed or sold to a collection agency, a collection account may appear on your credit report alongside the original account. If the debt was sold, the original account should show a zero balance, with the amount owed listed on the collection account.
How long they stay
Charge-offs and collection accounts can remain on your report for seven years from the date of the original delinquency, the first missed payment that led to the charge-off. Paying the debt doesn’t restart that clock.
| Situation | What your report usually shows |
|---|---|
| Charged off, unpaid | Charge-off with balance owed |
| Sold to a collector | Original account at $0, plus a collection account |
| Collection paid | Collection marked as paid |
| Seven years after first delinquency | The items drop off |
Paying old debts and your score
Newer models, such as FICO Score 9 and VantageScore 3.0 and 4.0, ignore collection accounts that have been paid. Older FICO versions, which many lenders still use, may continue to count them. Paying can still help with lenders who review your report directly, and it stops collection activity.
Quick tip
Before paying a collector, ask for written validation of the debt and check it against your credit reports. Get any payment or settlement agreement in writing, and keep proof of payment.
Red flag
Make sure a collection is accurate before acting on it. If the amount, dates or ownership are wrong, dispute the item with the credit bureau.
Moving forward
Focus on what you can control now: on-time payments on current accounts and low credit utilization. Know your rights when collectors call, as explained in our guide to dealing with debt collectors. If several debts are behind, a debt management plan may be worth discussing with a nonprofit counselor.
Reader questions
Will paying a collection remove it from my report?
Usually not. The account is updated to show it’s paid. Some collectors agree to request deletion, but that isn’t guaranteed.
Can a debt be on my report twice?
The original charged-off account and the collection account can both appear, but they should show the same debt and not double the balance owed.
Are medical collections treated differently?
The three nationwide credit bureaus have said they don’t report paid medical collections or medical collections under $500.
This article is general information, not financial or legal advice. Scoring models, lender policies and laws change, and state rules vary. Check official sources such as the Consumer Financial Protection Bureau and the Federal Trade Commission, and consider a nonprofit credit counselor for help with your own situation.