If you have been pushing bills aside for few a months due to loss of job or other misfortune, a charge-off might be right around the corner. Now is the time to find out just how this situation will affect your credit.
Credit Score
One of the worst impacts charge-offs will have on your credit report is a sharp decrease in your credit score. The more charge-offs you have, the lower your credit score.
Timeframe
Charge-offs typically occur after six months of nonpayment. These notations are recorded on your credit report for up to seven years after your initial delinquency.
Taking Action
Once you have paid your delinquent accounts, credit notation will change from "unpaid charge-off" status to "paid charge-off" status. This won't immediately increase your credit score, but will look better in the eyes of new potential creditors.
Negotiations
To get a charge-off removed from your credit report you can try negotiating a payment plan with your original creditor. Make sure you get something in writing from your creditor to confirm the agreement.
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