Charge-Off Credit Repair in Dallas-Fort Worth, Texas
A charge-off is an accounting entry that can have major repercussions on your credit score. When a bank or other lender loans money to you, that debt is considered an asset because it has value.
However, the value of that asset falls into question if you get behind on payments. With too many missed payments, the IRS requires the bank to remove your loan from its assets. The bank then “charges off” part or all of your loan from its books. When that happens, the charge-off will put a major dent in your credit score and hamper your efforts to borrow additional money.
FICO, the most widely used credit scoring system, estimates that a charge-off can reduce a consumer's credit score by as much as 150 points. Once placed on your credit history and sent to the credit bureaus, a loan that is marked as a charge-off will remain on your credit report for 7 years.
For customers in Dallas-Fort Worth, the credit repair professionals from Trinity Credit Services can minimize the damage of a charge-off to your credit score. We also handle much more than charge-offs. When you need credit repair services, we can help customers facing foreclosures, bankruptcies, tax liens, late payments, repossessions, collections, and much more.
Trinity Credit Services Can Help with Your Charge-Off in DFW
After your debt is charged off by a lender, you still owe the money and the charge-off may make it more difficult to repay the debt afterward. Typically, a lender responds to a charge-off in one of three ways:
- It tries to collect the debt itself.
- It hires a collection agency to collect for them.
- It sells the debt to a collection agency.
You have no control over when a debt is charged off or how it is charged off. That is determined by the law and the lender. Because 35% of your credit score is based on your payment history, any charge-offs or late payments will lower your score. To minimize the damage, Trinity Credit Services can suggest three possible courses of action:
- Pay the debt, even if it is difficult to do. Changing the status of your account to “charged off, paid” rather than simply “charged off” will be beneficial for landing future loans.
- Negotiate a debt settlement for less than you owe. Just understand there will be tax implications. Any time a lender forgives a debt of more than $600, it is required to notify the IRS and the forgiven debt is added to your taxable income for the year.
- Apply for an exemption from the IRS regarding the debt. Exemptions tend to be fairly generous. For questions, consult a qualified tax preparer.
Count on Trinity Credit Services to Help with Your Charge-Off in DFW
At Trinity Credit Services, we have been helping our DFW customers find solutions for charge-offs on their credit scores for years. Our credit repair professionals understand how to help you escape your current financial predicament and will guide you down that path. When you need our services, Contact Us online or give us a call at 844-844-0701.