Should You Pay a Charged Off Debt?

Charged Off Debt

If a credit card balance is charged off does it make much difference on my credit report if I pay it off or not?

If so, who would I pay, the credit card company or a collection agency?

I am no longer receiving any bills from them so I do not know how to pay them and wasn't sure if it would even help my credit rating.

Candace

Of course it will make a difference to your credit score if you pay off the bill.

It sounds as if the collection agency is handling this now. If you don't pay them, you might find yourself the object of a lawsuit.

Try to negotiate with either your lender or the collection agency to get the charge off removed in return for paying the debt. They can put a notation that your account was "paid as agreed" or some such language. If they agree, get it in writing before paying your debt.

If you pay the debt without doing this first, your credit report will carry a "paid charge off" notation for as long as seven years. While this will affect your credit, the effect will be less than an "unpaid charge off" notation.

The notices from the collection agency should let you know the name of your creditor. You can look up contact information on the internet or in the yellow pages.