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Re: Can creditor continue to charge interest after charge-off, forever?
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Posted by observer
(152.163.189.170) on July 15, 2002 at 13:46:27:
In Reply to: Can creditor continue to charge interest after charge-off, forever? posted by stressed out on July 15, 2002 at 13:12:39:
Not sure I understand what you're driving at but, after 180 days the OC has to charge this to P/L. When you defaulted, they raised your interest rate to default rates and started throwing in late fees and over limit fees. This has the affect of wildly inflating the amount that can be charged off. I mean, a card that had say a $1000 balance when it went into default can very easily show an addition $350-$400 worth of balance even though the OC was never exposed to loss on that additional amount. I'd really like to see some watchdog accounting group tear into a cc companies writeoff pratice and then issue a pro forma statement as to what earning would look like if they couldn't juice it up with all of those fees and 25% interest that they had no prayer of collecting. So, it's chargedoff and sold to a ca. The ca just keeps adding that default interest rate and fees and penalties hoping the number will be big enough that someone will eventually settle or, they go to court and get a judgment for the whole amount. Once past 180 days, the OC is out of the loop as far as chargingoff anymore accuring fees.
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