What Is a Credit Card Debt Write-Off?

When a credit card company writes off or charges off your debt, you are still liable for the debt.

Updated by , Attorney University of Denver Sturm College of Law
Updated 8/22/2025

If you fail to make payments on your credit card, the credit card company may declare your debt uncollectible. This process is commonly called a credit card debt "write-off" or "charge-off."

A write-off doesn't eliminate your obligation to pay the debt. Writing off a debt allows a credit card company to report it as a loss and reduce its tax liability.

What Is a Credit Card Debt Write-Off?

When a credit card company decides that it has little or no chance of collecting a debt, it will write it off as a loss. Essentially, a credit card debt write-off is an accounting tool that allows the creditor to declare the debt a worthless asset and deduct it as a loss.

How Long Before a Debt Is Written Off?

Typically, a credit card company will write off a debt when it considers it uncollectible. In most cases, this happens after you haven't made any payments for at least six months (around 180 days). However, each creditor has a different process for determining whether a debt is uncollectible. So, how long it takes before your debt is written off depends on your credit card company, your assets, and your payment history.

Are You Still Responsible for a Written-Off Debt?

Just because the credit card company writes off your debt doesn't mean that you're off the hook. A credit card debt write-off doesn't wipe out your liability for or obligation to pay that debt. It's simply a mechanism credit card companies use to get bad debts off their books. So, debt collectors can still call or sue you to collect the debt even after it is written off.

Why Creditors Write Off Debt

By writing off your debt, the credit card company gets to deduct it as a loss on its financial statements and tax returns. This lowers the creditor's taxable income and results in a reduced tax liability. Further, because you're still liable for the debt, it can sell it to a debt collector or continue its collection efforts against you.

What Happens After a Debt Write-Off?

When a credit card company writes off a debt, it will typically sell it (usually for pennies on the dollar) to a collection agency or other debt buyer. Then the collection agency can come after you to collect the debt.

Debt collectors make money by squeezing more payments out of you than what they paid for the debt. As a result, most debt collectors are notorious for repeatedly calling or otherwise pursuing borrowers to collect their debts.

How a Write-Off Affects Your Credit Score

If a credit card company writes off your debt, it will show up on your credit reports as a charge-off. Having a charge-off on your credit report usually has a negative impact on your credit scores. Further, a charge-off normally stays on your credit report for seven years.

Frequently Asked Questions (FAQs) About Debt Write-Offs

The following FAQs and topics answer common questions about debt write-offs.

Does a write-off mean I don't owe the debt anymore?

No. A charge-off is an accounting practice. You're still liable for the debt. You might consider settling the debt for less than you owe, paying off the full amount, or filing for bankruptcy (if you have a lot of debt that can be discharged).

Can I remove a charge-off notation from my credit reports?

Probably not. If the notation is accurate, it will remain on your reports for seven years. However, you might be able to negotiate the removal of the information from your credit reports as part of a debt settlement.

Can a creditor sue me after charging off a debt?

Yes, if the statute of limitations hasn't expired.

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