What signifies that a debt is classified as Closed Out?

A debt is classified as Closed Out when collection activity has stopped completely. This designation indicates that the debt has reached a point where all efforts to collect the amount owed have been exhausted, and no further actions will be undertaken to recover the funds. In this context, a Closed Out classification typically means that the debt is no longer considered collectible by the organization, and efforts to secure payment have concluded.

The other options do not align with the definition of a debt being Closed Out. If a debt is actively being pursued for collection, it clearly does not fall under the Closed Out category. Similarly, if collection activity is ongoing or reassessment of the debt occurs regularly, the debt remains active rather than being classified as Closed Out. Lastly, if a debt still qualifies for cross-servicing, it indicates that the debt is still subject to collection efforts by other agencies, further confirming that it cannot be considered Closed Out.