What Is a Charge-Off on a Credit Card? (And What to Do About It)
Quick answer: A charge-off means your card issuer has written off your unpaid debt as a loss, usually after about 180 days (6 months) without payments. You still owe the money. The account is closed, the debt may be sold to a collection agency, and the charge-off stays on your credit report for 7 years from the first missed payment.
How a Charge-Off Happens
| Time without payment | What usually happens |
|---|---|
| 30 days | Late payment reported to the bureaus |
| 60 days | Penalty APR may apply |
| 90–150 days | Collection calls and letters; account may be closed |
| About 180 days | Account charged off |
| After charge-off | Debt kept by the issuer or sold to a collector |
How a Charge-Off Affects Your Credit
A charge-off is one of the most serious negative marks. It can lower your score significantly and makes new credit harder to get. The impact fades over time, and it disappears 7 years after the original delinquency, even if you never pay (though you can still be sued within your state's time limit).
What to Do About a Charge-Off
- Find out who owns the debt (the original issuer or a collector).
- Verify it: ask for written validation if a collector contacts you.
- Pay in full if you can; the report will update to "paid charge-off."
- Or negotiate a settlement for less; get the agreement in writing first.
- Check your credit reports afterward to confirm the update.
- Rebuild with a secured card. See best credit cards for bad credit.
Frequently Asked Questions
Do I still have to pay a charged-off credit card?
Yes. A charge-off is an accounting move by the bank; the debt remains.
Will paying a charge-off remove it from my report?
Usually no, but it will show as paid, which looks better to lenders.
Can I be sued for a charged-off debt?
Yes, within your state's statute of limitations. See what happens if you stop paying your credit cards.
Updated September 2026. Sources: Consumer Financial Protection Bureau and Fair Credit Reporting Act rules on reporting periods. This article is for information only and is not financial or legal advice.
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