Beware of Zombie Debt

Zombie Debt

Beware of Zombie Debt. It seems Zombies are everywhere now even in your old debt. So what exactly is zombie debt? Just like real zombies that keep coming back from the dead, That is exactly what zombie debt is and how it got it's funny name. It's just basically debt that you thought was long forgotten and now it's come back from the dead like a zombie to haunt you again and again. It could really be anything from credit card debt to an old bill from that flip phone that you thought was the coolest thing ever that is still laying in a drawer somewhere. Whatever it is it's forgotten debt. You forgot it and heck the company maybe even forgot it. Unlikely but possible, How you might ask well maybe it was so small they didn't mess with it or it just fell through the cracks. Or perhaps it wasn't small you had thousands of dollars in credit card debt or you ran the bill on that flip phone up for a year and never paid it or whatever but the zombie debt you owe is huge. Whatever the case it could still be zombie debt. Basically you thought it was dead and here it is haunting you again.

Bill Collection Companies Bring Old Debt Back To Life

Bill collectors bring old debt back to life. They do this by buying old debt from that cell phone company or credit card company for pennies on the dollar. Say $1.00 for $1,000.00 owed. Not a bad deal right. Now all the bill collectors have to do is collect it. Pretty easy right. But this is debt that is long forgotten by you and the companies.

Statue of Limitations For Debt Collections

In California the Statute of Limitation for Debt Collections is four years. This is the time specified from the last payment you made. This is the time in which you can be sued for non payment. Now if you and the company you owe money too let this amount of time pass without making any payments then basically you are free and clear. However, what typically happens is the company you owe the debt too will sell the debt to a zombie debt collector. For pennies on the dollar and hope that you will pay something on the debt, anything really even one dollar because then the statute of limitations starts all over again. So then they have four years to come after you all over again.

How To Avoid Zombie Debt Problems and Zombie Debt Collectors

The best way to avoid zombie debt problems is to pay all your bills and not get the old debt in the first place. But, we will assume you are past that stage and have some old debt and some collection agency is calling you about some old debt. Now don't take their word that you owe the money because these debts are so old and have been sold so many times, typically several times that ownership of the debt is often in question. Not to mention the fact that if you are past the four year statute of limitation then you are really under no legal duty to pay the debt. Now if you were in a bad place a few years ago and say lost your job and marriage or house and now have all of those things back or at least some of them and can now pay the debt and it is legitimately yours, then you can pay it however you should only be doing it out of the goodness of your heart. Because this problem has all ready lowered your credit score and in fact your credit score is probably coming back. Not to mention the fact that you are under no legal obligation to pay it. So if you are considering paying it make sure you run your credit report and see that you do indeed owe them the money and it's not someone else they are talking about.