Zombie Debt

Zombie debt summary:

• Zombie debt can't be legally collected, but debt collectors will still try to revive it.

• You could accidentally bring zombie debt back to life (restart the clock) if you take ownership or agree to make payments.

• Regularly check your credit reports for signs of zombie debt and immediately dispute any errors you find.

Zombie Debt Definition and Meaning

A zombie debt is an old debt that you thought was dead. It’s typically old debt past the statute of limitations, also called time-barred debt, that’s revived by debt collectors. It comes back to life when a debt collector suddenly tries to collect that debt. The debt collector can't legally sue you for zombie debt but can still try to collect it by harassing you into submission. 

The debt collectors that revive zombie debt are often called debt scavengers. 

Types of Zombie Debts

Any kind of debt could become a zombie debt if it’s suddenly brought back to life after being ignored or resolved for some time. Zombie debt can include debt that:

• You already repaid or settled

• Was discharged in a previous bankruptcy

• Isn't yours, such as debt from identity theft

• You forgot about or that has fallen off your credit reports

• Is past the statute of limitations (also called time-barred debt)

Time-barred debt is one of the most common types of zombie debt. A creditor doesn’t have legal standing to collect time-barred debt, but debt collectors could still try. Old debts are often sold to debt collectors for pennies on the dollar. So any amount the debt collector can get from you is likely a win and makes harassing you worthwhile.

If a creditor or debt collector tries to sue you for zombie debt, you could ask the judge to throw out the lawsuit.

How to Kill Zombie Debt

Knowledge is power when it comes to fighting zombie debt. It's important to check your free credit reports each year to spot any problems or suspicious accounts. Report any errors to the credit bureau as soon as you find them.

You can fight zombie debts that have been purchased by a debt collector. Here are some tips:

• Verify the debt is real and belongs to you. The debt collector or debt could be fraudulent or the debt may be a result of identity theft. You may have already repaid the debt. The debt collector must send you a written confirmation that shows the debt and who owns it so you can check the details.

• Don't reset the clock on your debt. Time-barred zombie debt can be revived completely if you make any sort of payment or agreement to pay. Don't even admit to owing the debt at all or you could accidentally reset the clock on the statute of limitations.

• Don't ignore the debt. Zombie debt can be killed, but ignoring it could make matters worse. You could tell the debt collector to stop contacting you about the debt. If they sue you, you could ask the judge to throw out the case. 

Zombie debt doesn't have to be a nightmare. You can fight zombie debt with the right weapons.