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#635558 - 11/08/06 02:34 PM Record Retention- Charge Offs
LoanLady Offline
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Joined: Sep 2006
Posts: 110
How long should we retain Charged off loan files? The book I have says "5 years after close." What does CLOSE mean- 5 years after we have charged the account off, or 5 years after we receive payment for it??? Thank you in advance.

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#635559 - 11/18/06 04:23 AM Re: Record Retention- Charge Offs
Andy_Z Offline
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I thought it was 5 years after the last activity?
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#635560 - 11/18/06 02:43 PM Re: Record Retention- Charge Offs
Tom at HOME Offline
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Joined: Oct 2005
Posts: 1,139
From the Texas Civil Practices and Remedies Code.
    § 16.004. FOUR-YEAR LIMITATIONS PERIOD.
    (a) A person must bring suit on the following actions not later than four years after the day the cause of action accrues :
    (1) specific performance of a contract for the conveyance of real property;
    (2) penalty or damages on the penal clause of a bond to convey real property;
    (3) debt;
    (4) fraud; or
    (5) breach of fiduciary duty.

Charged-off debt is no longer collectible after the statute of limitation has ended. I think we use the 5-year rule because of the definition of “after the day the cause of action accrues.”

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#640852 - 11/21/06 08:43 PM Re: Record Retention- Charge Offs Tom at HOME
mck401 Offline
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Joined: May 2006
Posts: 1,168
Texas
If a charged off debt is no longer collectible after the statute of limitation has ended, how can third party collection companies sell collection accounts over and over again and the debts seem to linger? {I have a customer who had a cell phone bill charged off in 2/99. It should be off his credit report however, the charge off has been 'transferred' twice and now shows an original date of 4/06 and will come off his credit report 4/13 That doesn't seem right}
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