When does a charge-off occur?

Charge-offs usually occur if your account received no payments for six months, although some creditors can initiate a charge-off after 120 days. Charge-offs can occur even if you are making payments. You are more likely to see this if payments are habitually late or under the monthly minimum.

What does a charge-off mean?

In the simplest terms, a charge-off is a declaration by a creditor that an outstanding debt is unlikely to be collected. Read more to understand how a charge-off can happen and what you can do to prevent this from happening to you. If you repeatedly fail to make your credit card payments on time, your credit card account becomes delinquent.

What does it mean if a loan is a charge-off?

A charge-off means that a lender has written off a loan as a loss. However, if you have a loan that is a charge-off, you're still obligated to pay it. Having a charge-off on your credit report can negatively affect your ability to get future loans.