can charged-off accounts be included in bk?

[arkanimal]

hello - received a call from chase/wamu yesterday saying my account will be charged off next month, sold to a CA, and will be unable to be included in a bankruptcy...this is completely false isn't it? what the heck is bankruptcy for then?

[DeadManCrawling]

Scare tactic, an attempt to get you to settle probably.

Of course charge-offs are wiped out by bankruptcy. Chargeoff is just an accounting move, and a decision by the OC that your debt is probably uncolllectible. That is the point at which they send it to CA's and so on.

There are only a few things that BK won't affect: Child support/alimony, student loans, IRS taxes, monetary judgments from criminal prosecution, maybe a few more.

The only usual exception would be very recent charges of unreasonable or luxury items, but even then they have to file an adversary complaint and go to a BK hearing.

[kenshirley]

Certainly, and they should, otherwise they will reflect on your future credit.
And just because they are charged off does not mean that they cannot come back at some future date and try to collect in court. Not a good thing.
List all debts when you file.

[DSIG]

the original creditor may not sell it to a CA at all and are just saying this so that you may think they are absolved of any ownership to the account. Selling the account is certainly an option but most original creditors will retain it in-house for further collection until they decide to sell it off.

Tell them that if they sell it to make sure they report it as such on your credit reports. A sold acccount will result in a zero balance with the original creditor and could just boost your score.

List it on your bk schedule and include ALL CAs that its been to. The account will be listed in the bk schedule and the notification will go to the original creditor and all CAs its been to.