Daniel Rosen explains how charge offs damage credit scores. A single charge off can drop your score by 50 to 150 points and stays on your report for seven years. When the debt gets sold to a collector, it shows up as a separate collection account, hitting your score twice.
Seven years from the date of the first missed or late payment.
Approximately 50 to 150 points.
One of the most challenging things you can face is a charge off. Charge offs are extremely damaging to your credit report. They live on your credit reports for seven years from the date of the first missed or late payment, but also because the new debt collector, the one who just purchased it, now reports the account as a new collection. So your credit report shows a bad payment history with the original creditor, and it also shows a collection account. I call that a double hit. Their impact varies wildly depending on the circumstances, but just one charge off can drop your score anywhere from 50 to 150 points.
