If you’re dealing with a lot of debt, it can be easy to lose track of it. When you get a phone call, email, text or letter from a collection agency, you might assume that you owe the money they say you do.
That’s not always the case. That’s why it’s important to know about something called “zombie debt.” There are actually several types of debt that are often described this way. They include debts that:
- Have been fully paid off or settled with the creditor for a lesser amount
- Are past the statute of limitations for collection, which is generally at least three years (also known as time-barred debts)
- Are an error (for example, something wrongly charged twice or not credited after a return)
Collection agencies often don’t realize that a debt they’re trying to collect on is a zombie debt. Sometimes debts are sold by one agency to another, and collectors may lose track of whether it was already paid off or is now a time-barred debt.
Others, unfortunately, may try to collect it even if they know someone no longer owes the money. They’re known as “debt scavengers.”
How to avoid bringing zombie debts back to life
It can be tempting to make a minimum payment on a debt just to get collectors off your back, at least temporarily. However, by making a payment on a debt that’s been settled, written off or otherwise no longer owed, you could “reanimate” it. That’s just one reason why it’s crucial to ensure that you know the status of your debts and can recognize a zombie debt.
Dealing with debt collectors – even those who follow the rules of the Fair Debt Collections Practices Act (FDCPA) — can be extremely stressful and confusing. Whether you believe you have zombie debts or not, it’s smart to begin looking at ways to get control of the debts you really do have. With experienced legal guidance, you can determine the best course of action for you.
