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Elish2

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Charged off account showing balance?
Hello, I have a question in regards to a closed charge off account. The account was charged off in 2012. Things were rocky financially then, but I am in a better position to deal with it now. We were contacted by a collection agency that is a law firm. We negotiated with them to settle on the account and have made payment arrangements. However I noticed something that has me confused. The original account has always showed on my credit report as being "charged off", and it has always shown a balance. It does not show as $0, transferred, or bought but does say closed, charged off. There are also no debt collections listed on my credit reports and never have been. Only through recent research have I found that supposedly the account should show a zero balance if it was charged off. Also I noticed that when I got my payment agreement from the Collection agency, it says to make payments out to the Original creditor. My husband called the original creditor who said that this collection agency lawyer is responsible now for the debt.

Can someone help explain this to me? I am confused if this is correct or not.

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It sounds like the original creditor never actually sold the debt, they just placed it in in-house collections. So technically you do still owe the original creditor the amount, so in this case, I believe that they would be allowed to report a balance. If the debt was sold, then that would be a different story and they would have to mark it at zero.

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