What does "Charged off as bad debt. Canceled by credit grantor" mean?

[nozar]

CreditKarma shows this for a credit card. What does it mean?

I haven't heard from that credit card company in over a year.

How likely is it for them to sue me?

[justbroke]

It means literally what it is indicating. I may be wrong, but you may be confused because they appear in the same sentence. They are actually 2 different statuses just strung together.

Charged off as bad debt: After about 181 days, the creditor charged it off in their books (written off). (It is likely in or was sent to collections.) From what I can remember, these are usually status R9 which is the worst status you can have.

Canceled by credit grantor: Means that the account was closed by the creditor and not the consumer.

[nozar]

Thanks, that makes sense. The string does show up on two lines, but I didn't know if it was one wrapped sentence, or two.

So I can still get sued? I thought this meant the grantor just dropped the ball, with Covid and all.

I also see on Credit Karma for a loan account something slightly different: “Charged off as bad debt. Profit and loss write-off”.

Any idea what this one means?

[justbroke]

So I can still get sued? I thought this meant the grantor just dropped the ball, with Covid and all.

Unless the statute of limitations has run, or you filed bankruptcy and are under the automatic stay or have discharged the debt, a lawsuit is always possible. Generally, the older the debt the more likely it was sold or assigned to a collection agency. Whether or not the collection agency takes an aggressive approach is too fact-specific.

I also see on Credit Karma for a loan account something slightly different: “Charged off as bad debt. Profit and loss write-off”.

Same as what I wrote earlier...

Both the "charged off as bad debt" and "profit and loss write-off" are the same exact thing. When I wrote "written off", that is the same as a P&L -- profit and loss -- write-off. In other words, they took the loss on their books (no longer are listing as a receivable).

[nozar]

CreditKarma does list a collection agency for one of my loans, but not for those that were "Profit and loss write-off". Are they in limbo?

According to The Balance, the statue of limitations for loans ("written contracts") and credit cards ("open") is 4 years in CA, and 5 and 4 years respectively in Florida. Is that right?

How about just waiting it out for 3-4 more years? Get back to making money, then *IF* I get sued, settle with the creditors. CreditKarma doesn't show any accumulating penalties. (Background for those who haven't followed my case: I've been waiting for over a year for the IRS to sort out my tax situation, with no clear end in sight, and I'm considering no longer filing Chapter 7. In the meantime my credit score went up from 450 to 540).

[justbroke]

I can't tell you the law, but generally there is a statute of limitations for using process (lawsuits) to pursue a debtor. Even if the SOL has expired, a creditor can still "dun" you to a certain extent (as allowed by State non-bankruptcy laws). Of course, the IRS has a different SOL which I believe is 10 years (based on my own personal issue with them recently regarding 2010).

As for what may be in limbo, collectionwise, there is no way to tell. Each individual debtor, creditor, collection agency, and the specific circumstances will drive that train.

[Clambert1273]

As a previous CA resident, I will tell you that CA has good consumer laws that mirror FDCPA & FCRA only they are in Cali code

[nozar]

Even if the SOL has expired, a creditor can still "dun" you to a certain extent (as allowed by State non-bankruptcy laws).

What would that entail? What can the creditor do to the debtor after the statute expired?

[justbroke]

What would that entail? What can the creditor do to the debtor after the statute expired?

Call and send you letters if allowed in your State. They must stop calling if you tell them to not call.

A friend of mine is still receiving letters from an account from 2004. They show up once every few months "offering" a settlement amount of (usually) 50% off the amount which was due. I tell her to ignore them but she hates getting them. I say that's the only thing they can do... send letters. They can't threaten lawsuit or sue.