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zombie debt collection

You can stop Zombie Debt Collectors debt collector calls and letters, you have rights under Fair Debt Collection Laws!

Tags: Debt Collection, Debt Collectors, Debt Collection Practices, Collection Laws

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Fair debt collection practices act explained with FREE collection dispute letters and instructions to stop bill collector's illegal harassment! Learn to fight back against.

Help for debt collector problems, research your consumer rights under fair debt collection practices laws and fight back again illegal collection tactics.

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Preventing Zombie Debt from Rising Again

Buying old debt is a multi billion dollar industry, putting millions of customers at risk for “Zombie Debt” collection efforts. When old debt is sold, the debt buyer typically only pays pennies on the dollar for these charged off accounts. These companies then engage in collection actions against consumers to try and get them to pay the full amount of the debt owed or as much as possible in the form of a settlement.

Consumer protection against these tactics comes from knowing your rights and knowing how to address collections.

Zombie debt comes in many forms. It can be debt that is old and has passed the statute of limitations for legal collection, debt that has been previously paid or settled, or a debt that is legitimately not owed. Zombie debt can be a result of bad information being provided to a debt purchaser by the seller, incomplete account information or just a general mistake due to the similarity of the account owner’s name and/or poor research on the part of the collector. Either way, it is important to know your rights whenever you are dealing with debt collectors and to be sure to make note of all conversations, payments and settlements with written documentation. Be sure you also retain these records indefinitely, so that you can prove the debt has already been paid or settled should it show up on your credit report in the future as a collection account.

What to Do When Settling Debt?

Get Everything In Writing. All correspondence needs to be in writing BEFORE you send any money, with no exceptions. When the terms have been met, you should also receive a final statement showing the debt is no longer owed. Maintain this paperwork to prove the debt has been paid, discharged or settled in a safe place, indefinitely.

Search for Your Account on The Global Debt Registry. This registry is a national database of debts and can be found at Not every company registers debts because the collector must pay to list the debt on the site. The database will maintain the status of debts indefinitely and can assist in proving a debt is no longer owed and protect you from future collections should you find your debt listed on this website.

Check Your Credit Report. Check your credit report 30 to 60 days after the debt has been satisfied. Verify the report has been updated and the debt is showing a zero balance. Keep a copy with other paperwork. If the account has not been updated, file a dispute with each of the three major credit reporting agencies and include documentation showing the debt has been satisfied.

What to Do If a Collection Agency Calls About Old Debt

Do not acknowledge or discuss payments until the debt is verified. The collection company is required by law to verify the debt with the full chain of title within 5 days of your request. You have 30 days to request verification and this should be done in writing via certified mail with return receipt.

Check the Global Debt Registry. The database is free for consumers and lists old debts and their status for companies that report their accounts to the site. There are also forms available that enable you to dispute the debt, request validation and obtain an account extinguishment report, which can prove the debt is no longer owed.

Regularly monitor your credit file to ensure the old debt is not listed. If an old debt shows up, dispute it by sending proof of payoff, settlement or discharge.

Always respond to legal documents regarding debt. One strategy unethical debt buyer’s use is lawsuits for expired debt. If this occurs, and you do not show up to court, a judgment can be placed against you making you legally obligated to pay the expired debt.

Settling, paying off or having debt discharged does not necessarily mean the end of collection efforts. To protect yourself, get all agreements in writing, keep relevant paperwork in a file you can locate, and monitor your credit at least annually.

The Global Debt Registry is a valuable tool helping consumers ward off unscrupulous collection companies from collecting on debt that is no longer owed.

zombie debt collection

“Zombie Debt” is debt that you cannot be sued for because the statute of limitations has run. It’s called Zombie Debt because it should be dead, but unscrupulous debt buyers keep bringing it back to life.

How does this happen? Often, a “debt buyer” purchases debts from another company and then works to collect it using phone calls and letters. Often, these debts are purchased, sold, and resold many times. The lack of information that these debt buyers and collectors have about these debts is alarming. In a 2009 study, the FTC showed concern that debt collectors, including debt buyers, may have insufficient or inaccurate information when they are working to collect on debts. This can result in debt collectors trying to recover from the wrong person, or recover the wrong amount, and/or filing a lawsuit past the statute of limitations.

What happens? The less reputable debt buyers and collectors use intimidation, harassment, deception, or other abusive tactics to get their victims to pay or make payments on the debt. Because the debt buyers have literally bought the debt for pennies on the dollar, any collection on the debt generally amounts to a huge windfall for the debt buyer. Worse yet, some of these debt collectors will receive large payments on a debt from an individual, then sell the same debt to another debt buyer, resulting in a new round of collection tactics by another company for the same debt amount or higher. In the worst cases, some debt buyers will file lawsuits because they realize many people do not know there are consumer protections against zombie debt collection. When a lawsuit is filed, the court only has the information supplied by the debt buyer filing the lawsuit. If the individual being sued does not respond to the lawsuit, or does not respond with a recognized defense, then the debt buyer will seek a default judgement and garnish wages.

What are my rights? Consumer protections provided by the West Virginia Consumer Credit & Protection Act and the Fair Debt Collection Practices Act make it unlawful for debt buyers to file lawsuits for Zombie Debt. Additionally, in West Virginia, every debt collector is required to provide notice if they are trying to collect a zombie debt. Unfortunately, some debt buyers still try to collect zombie debts because they don’t follow the rules. These debt buyers won’t provide the required notices either because they don’t do their homework on the history of an old debt, or because they are willingly breaking the rules because they believe the person they’re going after will not seek legal assistance.

At Skinner Law Firm, we represent clients who have been unlawfully contacted by debt collectors. If you believe you have been subjected to unlawful collection tactics, then contact us for a no cost consultation. We can stop a lawsuit in its tracks and even obtain money for our client when the debt collector has broken the rules.

Stephen Skinner is the lead attorney for Zombie Debt cases.

Zombie debt collection

Since 1969, Skinner Law Firm has been dedicated to helping people with wrongful death, injuries, insurance issues and consumer fraud.

zombie debt collection

***Update: See the 4/2/12 post on recent Court of Appeals cases related to the statute of limitations for debt collection in Oregon***

We’ve been getting a run of questions from people who want to know the statute of limitations on their consumer debts, but the length of this blog post got away from me once I realized how interesting (and relevant!) this subject is in these tumultuous days of “lendor industry meltdown,” though the little guy, once again, may be getting short shrift.

If you are contacted about a debt (paid or unpaid), our recommendations:

1) Take it seriously, very seriously, and prepare to do some research

2) Research the Oregon laws to find the statute of limitations and debt collection laws

3) Read LASO and OSB materials on debt and related consumer law issues

4) Visit your library and read self-help books on debt and debt collection

(Coincidentally, this past Sunday’s Parade Magazine also had an article about these same debt and statutes of limitation issues:

Excerpt: “… Don’t pay money you don’t owe: Because debt collectors often are working with old data that have been through many hands, their records are sometimes wrong. If you don’t believe you owe the money or if the amount claimed by the debt collector is incorrect, dispute the claim in writing. The collector is obligated to show you some proof that you owe the money—at least a statement from the original creditor attesting that the information is correct. If the collector is calling about a debt you incurred long ago, be aware of the statute of limitations. Like a gallon of milk with a “sell by” date, debt can become too old to be useful to collectors. The statute of limitations differs from state to state but typically runs three to six years. After that, a debt collector can’t sue to collect a debt. If a collection agency states or implies that you have to pay a debt whose age exceeds the statute of limitations, it has broken the law. Always check the date of your debt: Paying even a small portion of an expired debt may reaffirm the debt and trigger the obligation to repay it in full. …” (read full article).)

“Zombie debt gets its name because the debts in question are supposed to be dead and buried since:

1) They’ve been settled in bankruptcy proceedings.

2) They’re the result of mistaken identity or identity theft, so they were never your responsibility to begin with.

3) Their statute of limitations has expired.

These debts are reanimated by collection agencies hoping to make some extra profits.

You know the guy in the B movie who seals his own doom by panicking and getting himself cornered by the relentless zombie army? Zombie debt collectors expect you to be that guy. They make their profits from consumers who don’t know their rights, don’t know how to protect themselves, and panic….” (link to full article)

Read more about “Zombie” Debt:

2) And another article here, and here, and here. The Zombies Really ARE Here!

3) And a longer report from the FTC: on Collecting Consumer Debts: The Challenges of Change, by the National Consumer Law Center, on behalf of its Low Income Clients and the National Association of Consumer Advocates, June 6, 2007