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Re: Charge off / closed


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Posted by Drew (24.59.27.46) on September 26, 2003 at 09:22:54:

In Reply to: Charge off / closed posted by anon on September 26, 2003 at 09:03:29:

A charge off is where the creditor takes a loss and writes you off. It reflects badly on the consumer and damages your credit report.

A closed account can be neutral or bad depending on how it is used. If it is used in conjunction with a charge off, the creditor charged off your account and then closed it. That looks really bad.

A closed account outside of a chargeoff can be neutral depending on the situation. A creditor may close an account if it is going out of business or if the account is sold to another company and a new account number is assigned. They will just close out the old account number. Or a creditor may close out an account if it has been inactive for a long time as part of cleaning house. For example, you have not used the account in six or seven years. The creditor may then choose to close out the account.

Or the consumer may close out the account themselves because they don't need it.

I hope this helps.


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