Yes. A charge off is only relevant for the lender’s accounting and tax reporting; it does not relieve you from your liability to pay the debt. There are many debt elimination scams out there that advertise on the internet. Some of them propagate the theory that once a debt is charged off a consumer no longer has to pay it. I have heard from people who have been taken in by this myth. However, a charge off just reduces the value of the lender’s loan portfolio. If a lender later collects a charged off debt or sells the right to collect it to a debt buyer, the value received is added back into the lender’s balance sheet. Of course, a bankruptcy discharge discharges debts irrespective of the charged off status of the debt on the lender’s books.
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