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Charge-Off Calculator

U.S. only tools

When a card goes unpaid, the issuer eventually writes the balance off its books and usually sells the debt to a collection agency. That moment is a charge-off, and it is not the end of the debt - it is the point where the balance usually stops growing via the card’s fees and keeps growing through whoever now owns it.

Charge-Off Calculator - Danfio

https://danfio.com/tools/charge-off-calculator/ - printed from this page

Currency: USD ($) - display only, nothing was converted

$

What the card owed when the first payment was missed: the statement balance, not the minimum payment that was due.

The punitive rate the card charges on an account in default, if you have one.

$

The late fee added while the account is still being billed. Capped in the estimate to the first three months.

How long the balance runs with nothing paid. Six months is the point creditors commonly cite for charge-off.

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Currency symbol

Symbol only - nothing is converted and no exchange rate is used. Figures quoted in the explanation text stay as the sources publish them.

Balance at charge-off

$2,390

Leaving $2,000 unpaid for 6 months at 25% turns the debt into about $2,390 before collections: $2,000 still owed, $273 of interest and $117 of late fees.

Interest accrued
$273
Late fees added
$117
Days since the first missed payment
180 (about 6 months)

How the balance grows

MonthInterestLate feeBalance
1$41.67$39.00$2,081
2$43.35$39.00$2,163
3$45.06$39.00$2,247
4$46.81—$2,294
5$47.79—$2,342
6$48.79—$2,390

A charge-off does not make the debt go away. The creditor writes it off its books, often sells it to a collection agency that keeps collecting - and the settled-for-less or paid-in-full outcome is recorded on the credit report.

This page estimates the balance at charge-off: the unpaid principal, plus monthly interest at the card’s APR, plus the late fees that stop after the first few months because the account is already heading off the books. Six months without a payment is the commonly cited charge-off point, which is why it is the default.

About this charge-off calculator

Charge-offs mark the moment a creditor writes an unpaid card off its books, but the debt does not disappear with the accounting entry. This page rolls the balance forward month by month to that point, adding the card’s interest and the late fees that stop once the account is clearly headed for write-off.

The model is a printed monthly roll - interest at the card APR each month, a late fee for the first three months - so each step of the growth can be checked against the table rather than taken on trust. The arithmetic runs client-side in your browser, which means the balance and rate you enter stay on your own device.

An estimate, not financial advice; your lender's Loan Estimate overrides it. Whether the issuer waits six months or longer, whether the rate jumps to a penalty APR, and whether a collector later settles for less are all outside the arithmetic. State statutes of limitation on suing over an old debt, and whether a collector files before one runs out, are outside the arithmetic too. Confirm the timing and the current balance with the creditor rather than relying on the total.

How this charge-off calculator works

Interest keeps compounding, fees eventually stop

From the very first missed payment, interest accrues every month on the whole outstanding balance, not just on the original principal. The card keeps billing at its APR, and once an account falls behind that rate is often the higher default rate the agreement allows - twenty-five percent or more on many cards. Because each month’s interest is computed on the previous month’s total, the balance grows on a slightly larger base every billing cycle, which is how a modest balance can balloon over just a few months of silence.

Late fees behave differently. The model adds them only for the first three months and then stops, because once an issuer has decided an account is heading toward charge-off it usually stops piling on fees it does not expect to collect. The monthly table prints the interest, the fee and the running balance for every month, so the growth reads as a process rather than a single number. The default of six months is the timing most issuers cite for charge-off: 180 days past due.

A charge-off is not forgiveness

When a creditor charges the account off, it writes the balance down as a loss on its own books and stops expecting payment directly from you. That accounting move can sound like the debt disappearing, but it is the opposite: the obligation is real money you still owe, just under a different owner. The account is usually sold to a collection agency at a fraction of its face value, and the collector then pursues the full balance in its own name.

Being charged off also changes your credit record independently of the balance. The charge-off status itself stays on your credit report for about seven years from the original date of delinquency, a mark that affects new credit applications even after the debt is eventually paid or settled. Paying it later updates the status to paid or settled rather than removing the entry, which still reads far better to a future lender than an open charge-off.

What the page cannot know

A charge-off point is set by each issuer and by the card agreement, so no default can promise when a given account will be written off or how its rate behaves in between. Some issuers apply a penalty APR the moment a payment is missed, some raise the rate only after a second strike, and some wait longer than six months before charging off. The page therefore models a deliberately simple roll - monthly interest plus three capped late fees - and prints the assumptions it used beside the result.

A settlement is the biggest unknown of all. Charged-off balances are often pursued by collectors who will accept a fraction of what is owed, and the negotiated amount can sit well below what this projection shows. That outcome cannot be predicted here, so treat the printed figure as the cost of doing nothing while the balance keeps compounding, not as a forecast of what a lawyer, a settlement company or a negotiation could reduce it to.

Late fees matter most on small balances

Because the late fee is a flat dollar amount capped at the first three months, it weighs far more on a small balance than on a large one. Three fees of $39 add $117 in total, and on a $600 balance that can outstrip months of interest even at a punitive rate. On a larger balance the interest dominates, because it compounds on the whole sum every month and the flat fee becomes a rounding error by comparison.

The printed schedule keeps both lines visible so you can see exactly where the growth tips from fees toward interest. That switch is useful in a practical way: it explains why the same card rules produce a very different mix of interest and fees depending purely on the starting balance, and why being late on a small card is comparatively more expensive per dollar of debt than on a large one.

Worked examples

Each example below was run through the calculator on this page when the site was built, so the numbers match what you see when you enter the same inputs.

A $2,000 card, six months without payment

Balance at the first missed payment: $2,000.00 · APR: 25% · Monthly late fee: $39.00 · Months without a payment: 6 months

Balance at charge-off

$2,390

Leaving $2,000 unpaid for 6 months at 25% turns the debt into about $2,390 before collections: $2,000 still owed, $273 of interest and $117 of late fees.

Interest accrued: $273 · Late fees added: $117 · Days since the first missed payment: 180 (about 6 months)

Six months at 25% with three late fees turns $2,000 into about $2,390 - the number a collection agency might eventually show up asking about.

A year without payment on the same card

Balance at the first missed payment: $2,000.00 · APR: 25% · Monthly late fee: $39.00 · Months without a payment: 12 months

Balance at charge-off

$2,705

Leaving $2,000 unpaid for 12 months at 25% turns the debt into about $2,705 before collections: $2,000 still owed, $588 of interest and $117 of late fees.

Interest accrued: $588 · Late fees added: $117 · Days since the first missed payment: 360 (about 12 months)

Twelve months of compounding at 25% more than doubles the interest portion. The page prints the schedule so you can see the growth accelerate as the balance itself grows.

A penal APR over a full year

Balance at the first missed payment: $5,000.00 · APR: 29.99% · Monthly late fee: $39.00 · Months without a payment: 12 months

Balance at charge-off

$6,874

Leaving $5,000 unpaid for 12 months at 30% turns the debt into about $6,874 before collections: $5,000 still owed, $1,757 of interest and $117 of late fees.

Interest accrued: $1,757 · Late fees added: $117 · Days since the first missed payment: 360 (about 12 months)

Twelve months at 29.99% adds about $1,760 of interest, taking $5,000 to roughly $6,870 before the debt is even sold to a collector.

When the fees outweigh the interest

Balance at the first missed payment: $600.00 · APR: 35.99% · Monthly late fee: $41.00 · Months without a payment: 4 months

Balance at charge-off

$806

Leaving $600 unpaid for 4 months at 36% turns the debt into about $806 before collections: $600 still owed, $83 of interest and $123 of late fees.

Interest accrued: $83 · Late fees added: $123 · Days since the first missed payment: 120 (about 4 months)

On a small $600 balance four months at 35.99% add only about $83 of interest, but the three capped late fees of $41 add $123 - the part of the growth that has nothing to do with the rate.

Frequently asked questions

What is a charge-off?

A charge-off is when the creditor writes an unpaid balance off its books as a loss, usually around 180 days past due. The debt is not forgiven: it is usually sold to a collection agency that keeps collecting, and the charge-off stays on the credit report for seven years from the original delinquency.

Does paying a charged-off account remove it from my credit report?

No. Paying it stops collections and looks better to future lenders than leaving it unpaid, but the charge-off itself remains on the report for seven years from the original delinquency date. A settlement that resolves the debt for less is worth negotiating when it is offered.

What happens to the debt after a charge-off?

The issuer writes it off its books and usually sells it to a collection agency at a discount. The agency then collects under its own name, and any payment or settlement is reported. The charge-off stays on the credit report for seven years from the original delinquency regardless of who owns the account now.

Can a charged-off balance keep growing?

Yes, in the sense that the owner of the debt can keep adding interest and fees under the card contract, though many collectors stop compounding once the debt is bought. The page estimates the balance at the charge-off point; what the buyer does afterwards is a separate negotiation.

Should I pay the original creditor or the collection agency?

Pay whoever currently owns the debt, and get the arrangement in writing first. If you settle for less than the balance, the forgiven amount may be taxable, and how the settlement is reported changes how it looks on your credit report - negotiate the reporting as part of the deal.

Assumptions and sources

  • The model is a printed monthly roll: balance plus APR/12 interest every month, plus a late fee for the first three months.
  • Six months (180 days) as the typical charge-off timing and the seven-year reporting period are the commonly cited figures; the page labels both as typical rather than universal.
  • This is an estimate tool, not debt, financial or credit advice. When the issuer charges the account off and whether a settlement reduces it are the issuer’s call, not this page’s.
  • Debt collection and credit reporting background, including how long a charged-off account stays on a report: US Consumer Financial Protection Bureau guidance and the Fair Credit Reporting Act.

Last reviewed 2026-09-28. An estimate, not financial advice; your lender's Loan Estimate overrides it. Read the full disclaimer.

Where a figure on this page comes from an official agency — HUD, IRS, FICO or a state body — the site keeps a dated snapshot of the source page in its sources library, and a scheduled job re-checks that snapshot, so the number can be traced back to the document it came from.

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