A credit report contains the Status of every credit account. In this article we will explain the status of charged off, written off and a transfer account as it shows in the credit report.
Charged off or are written of account is pretty much the same thing. It means the creditor has closed the counts in his accounting books and lost all expectation of recovering the money from you as the borrower. Basically when a creditor charges of a debt he considers it as a bad debt.
When an account is reported to the credit bureau as charged of all written off it is a final status that reflects that the account is no longer open and functional.
Another status that may be reported to the credit bureau could be paid and written off or paid and settled which means that while the debt was paid it was not paid in the full amount that was due to the better. Both the entries of charged off and paid and settled have a negative impact on the credit score since they indicate either a non-payment or an incomplete treatment to the creditor. Only if the account has a status of paid and closed does it imply that the account was paid in full and the account is no longer open to further charges.
In many cases of a debt being written off charged of the debtor transfer or sells the debt to another company who is willing to buy a debt at a much lesser cost and recover the money of the balance from the borrower. If the creditor does this should then the status reported on the credit report might be written off and transferred. Most of the times on the entry also contains the information about who the debt has been transferred to. If the debt has been transferred to a debt collection agency then it is likely that a new account will be reported by the debt collection agency to the credit bureau. Your credit report will now have a new accounts that will have the status of collection account along with saying “transferred from” and listing the name of the original debtor from which the debt has been bought. A collection account also figures negatively in the credits or calculation. Once a collection account is opened it means that you are not liable to pay the collection agency for the amount that you owed on the original debt.
It is important to understand the reason for the account being transferred. A transferred status of an account in the credit report is not necessarily a bad thing. The account may be transferred for reasons other than non-payment. Just because the debt has been transferred does not mean that it has been written off by the current creditor. The current creditor may be closing its business or may have merged with another business in which case your account will be transferred to the newly incorporated business entity. In this case the transferred studies will still be associated with a positive credit history as long as all the payments continue to be made as before with no late payments being reported.
Maintaining a complete record of the status of the account such as home the account is transferred to and from home helps you keep the track of your debt from the original lender through the subsequent owners of the debt.