Charge-off Feed Link

Charge-off

A charge-off (or chargeoff, charge off) is the declaration by a creditor that a debt, typically a credit card account, is unlikely to be collected. This occurs when a consumer becomes severely delinquent on a debt. Traditionally, creditors will charge off an account when it has been delinquent for 180 days.

After an account is charged off, a creditor may still pursue payment by outsourcing it to a third party debt collection agency, selling the debt to a debt purchaser, or forwarding the account to an attorney to consider legal action. If the activity results in a recovered amount, it is added back to the creditor’s books. As such, most credit grantors report a “net charge-off” figure, which factors in recoveries after charge off.

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Debt Industry Responds to New York’s New Rules for Collectors, Buyers

Now that the industry has had the chance to take a deeper dive into the details of the New York Department of Financial Services’ proposed regulations for debt collection by third-party debt collectors and debt buyers, experts and organizations are submitting their feedback on how to further improve the regulations. Specific questions remain about the correct language to use in consumer notices, and how the rules may impact creditors.

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GE Capital/Synchrony Bank to Pay $225 million in CFPB Credit Card Discrimination Action

The Consumer Financial Protection Bureau (CFPB) today announced that it is ordering GE Capital Retail Bank, now known as Synchrony Bank, to provide an estimated $225 million in relief to consumers harmed by illegal and discriminatory credit card practices. The CFPB said it is the federal government’s largest credit card discrimination settlement in history.

Bank Earnings Preview

Chase Debt Collections Continue to Fall

JP Morgan Chase’s annual 10-K report to the SEC reveals some critical details about the mega-bank’s debt collection practices. In 2013, JP Morgan Chase recovered $593 million of charged-off credit card debts, continuing a three-year trend of anemic debt recovery. In 2010, the country’s biggest bank recovered $1.37 billion from unpaid credit card bills it had […]