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Bankruptcy FAQ

What is ‘zombie debt?’

On Behalf of | Sep 2, 2019 | Personal Bankruptcy

No, “zombie debt” does not refer to the credit card balances owed by characters on The Walking Dead. It’s debt that is, like zombies, dead. It’s no longer owed. That may be because the statute of limitations for collecting it has passed, it’s been discharged in bankruptcy or it’s already been paid off.

Unfortunately, if you have any zombie debt, you may still be receiving calls or other notifications for collectors trying to get you to pay it. That’s because debt-buying companies sometimes purchase debt that can no longer be legally collected and contact the debtor in an effort to get payment.

These companies may hope that the people who once owed the debt won’t remember that it was paid or will be so frightened by the collection attempts that they’ll pay it when they don’t have to. If a person ignores the collection attempts, the company can sue them for the debt and collect a default judgment that’s legally enforceable. Often courts are too overwhelmed to research the debt and determine that it’s already been discharged or paid.

If you’ve been overwhelmed by debt for some time, you may not realize that some of your debts are too old to be collected. If you’ve filed for bankruptcy in the past, you may not have records readily available of what debts were discharged.

Even if you have debt that you still owe, there are laws regarding what methods can be used to collect them. Unfortunately, some debt collectors disregard these laws in an effort to get as much money as possible, by whatever means necessary.

If you’re receiving collection calls or notices for debt that you believe you no longer owe or you aren’t certain which collection efforts are legitimate and which aren’t, it may be helpful to contact an attorney. Once you have a clear picture of just how much money you owe, you can better determine whether bankruptcy or another debt relief option is right for you.

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