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Interest on ChargeOff


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Yes they can - each state has laws on the amount of interest and fees a collection agency and/or original creditor can charge. The link below is usary laws and covers judgements....anyone know where a good link for all the state's maximum interest on collection accounts is? I have a paperback book with it, but nothing on line.

Usary laws

http://www.lectlaw.com/files/ban02.htm

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Admin where do you think we would find this info at? This is a good one for legal interest and judgment interest and bad check and sol laws.

http://www.hpacollect.com/laws/map_laws.htm

I will keep looking for this info.

Here is a good link for basic info on legal interest and interest on judgments along with SOL and other collection info.

http://www.edebtnetwork.com/content/collection_laws.asp

Edit: I misread your post and didn't see the link, but this is another one.

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  • 2 years later...

so your credit card can still charges fees on a charge off monthly even if its been closed and charge off? my account was charge off 11/2003 when it was charge off and closed the balance was about $3500 now its over $5000. so this is legal? it looks like my account is still open because every month the balance changes and it looks likes i have late payments? it shows monthly activity on my credit report.... is there anything that i can do about this?

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jcwhitaker. There's several other discussions of charge off's around here, but let me recap...

The short answer is yes, and OC can continue to charge interest and penality as long as the still own the account (i.e., not listed as "sold to another lender").

If they're an FDIC bank, they have to stop at 180 days. Most banks have seperate CC operations that get them around this. Non bank CC operations must go by IRS rules which says, depending on their accounting methods, that they can keep your account on their books for 2, 3, or 7 years and continue to charge interest and penalties. This is "accrued" income and whether or not a CC company actually does it depends on whether they want to inflate their income for P&L purposes.

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cap1 is oc, are they know for that? this can go on for seven years? it looks like i'm late with monthly payments even though the acc is charge off. plus i got a credit report in april of this year my credit score was 630 and now it 557. i been on time with all payment since 2003, i only have 2 accts with zero balances and my house payment, nothing has changed other then cap1 balance. i just dont understand why my score dropped 73 points. would it have been because of cap1? i contacted cap1 ask for statements and agreement that was sign have not heard from them its been more then 30days now...

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well, may wait until nov to dispute...thanks for your help

Hard to tell about Crap1...all the CC companies seem to switch gears on this several times a year depending on how they want their balance sheets to look for their shareholders.

And...with only a mortgage and two $0 balance CC's on your reports, its likely that a single negative would hurt your scores...

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How does the additional interes affect someone who is filing chapter 13? Does the interest rate continue at the extremly high numbers that I had been charged once I could not keep up with the payments?

Once you file for bankruptcy all charges stop on the account. No further interest is assessed and you pay back a set amount on it for 5 years. Any remaining amount after the 5 years is up is discharged (you don't have to pay). Because the balance is discharged and the payments are set by the trustee, it would not make any sense to charge continuing interest even if they could.

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