What is the difference between loan default and charge-off?

Default and charge-off are sequential states. Default happens first, usually at 90 days past due though the trigger varies by contract. Default unlocks the lender's remedies under the loan agreement: accelerating the full balance due, suing for the debt, and reporting the default to bureaus.

Charge-off follows at 180 days under federal banking regulation for most consumer loans. The lender removes the receivable from its balance sheet (an accounting move) and either continues internal collection, places it with a third-party collection agency, or sells the debt to a debt buyer. The status changes from "default" to "charged off" on the credit report.

Neither step extinguishes the debt. You still owe it, and statute of limitations on collection lawsuits varies by state (3 to 10 years). A charge-off mark on the credit report stays seven years from the original date of delinquency, regardless of subsequent payment.