When Debt Rises From The Grave

An increasing number of consumers are receiving collection notices about old debt. In most cases these debts are extremely old sometimes decades old and can even include debt that was paid off. So, what is prompting this increasing activity; the chance to make a buck.

There are several companies on the market today that specialize in the purchase of old debt. They are able to buy old debt from lenders for just pennies on the dollar which makes the potential for profit very high.

Consumers are surprised to receive notification that they are being demanded to pay on an old debt. Often times, these old debts are past the stature of limitations making them effectively dead. However, companies are still demanding payment.

The statute of limitations varies debt to debt and state to state but is on average, seven years. Now, there are some debt that do no have a statue of limitations or, if they do can be several years. Student loans are an example of this.

When companies demand payment on debts that have gone past the statue of limitation they are breaking the law. Yet, companies still participate in the unethical practice so it is important to recognize zombie debt claims and how to deal with it.

The first thing to do is to find out what your state says about the statue of limitations on debt. This way you will know if the collection agencies are trying to collect on a legitimate claim.

The statue of limitations usually starts 180 days after last account activity. This is important to keep in mind so you do not unintentionally restart the clock. You can do this in several ways including, acknowledging the debt, making a payment, or making a charge on the credit card with the debt.

When a company attempts to collect a debt especially a very old one, they tend to get quite tenacious in their tactics. Abusive practice among the debt collectors are well known with the Federal Trade Commissions receiving countless complaints about them each and every year.

Should you happen to receive notice of a debt that is over the statute of limitations you may be familiar with the several abusive practices these companies participate in.

Consumers are subjected to:

• Threats of legal action on dead debts or debts that have already been paid
• Harassing phone calls at all hours
• Re-aging debts. This practice is highly illegal
• Asking for a small payment. That small payment can restart the statute of limitations making you responsible for the debt

Many consumers already know what to do in the face of those seeking payment on zombie debts; they ignore it. In fact this just might be the best defense against such actions. You do not want to give the impression that you are responsible for the debt and if you are responsible for the debt you need to remember that the statute of limitations may be up or nearly up and acknowledging the debt is a way of restarting that clock.

If the companies become too abusive you may want to seek legal action or apply for free debt relief from tfgi.com

Recent articles:

• Some Tax Deductions People Miss
• The True Cost Of Medical Debt
• The Financial Benefits and Drawbacks of Marriage
• Foreclosure And Your Pets
• What To Do If You Fear Defaulting On Student Loans
• Taxes Could Go Up in the Future