Beware of Zombie Debt

Zombie debts can come back years later to haunt you.

With all this talk of zombies in the news, here's another type of zombie you may not have known about.

No, it's not flesh eating zombies, but zombie debt.
Zombie debt is a term that has been applied to debts that were (or so you thought) settled and done. Because debts can be sold from one collection agency to another there is a great opportunity for making money in the reanimation (this is where the Zombie moniker comes in) of a debt you thought was resolved. Knowing about Zombie debt is important because even debt that has been resolved through bankruptcy or resulted from identity theft can come back to haunt you. Some consumers have even been threatened or sued over zombie debt, both practices that could be considered illegal if the debt is fraudulent.

If its illegal why is it happening?
Each state has its own statute of limitations on how long a debt can go unpaid before you are no longer responsible for paying it. However, collection agencies can purchase these debts from the original creditor for just pennies on the dollar allowing them to make a huge profit if you pay on it. Paying on the debt or even admitting that it is yours can reopen the statute of limitations.

So do you really owe on this debt and if not, how do you kill something you thought was dead?
First, find out if the debt is yours and was not paid. Many zombie debts are the result of identity theft, are fraudulent debts or are past the statute of limitations and you are not responsible for paying them. If you are unsure of the debt, do not discuss it with the collector over the phone. Ask for the mailing address of the company and dispute it in writing. If the debt is legitimate and you do not respond to the collection agency, they can take you to court. If you receive notice that you are being taken to court, contact a lawyer and dispute the debt in court with legal representation.

Don't let zombie debt get your credit score, contact Attorney Erwin F. Meiers, III today to discuss your debt.

http://www.investopedia.com/terms/z/zombie-debt.asp#axzz1yuKcpBqV
http://money.howstuffworks.com/personal-finance/debt-management/zombie-debt.htm
http://www.forbes.com/2008/10/31/debt-creditors-default-pf-education-in_af_1031investopedia_inl.html

Automatic Stays and your bankruptcy

What is an automatic stay? An 'Automatic Stay' is put in place once a bankruptcy claim is made. An automatic stay puts a hold on pesky phone calls from collection and repossession agencies.

According to the senate report relating to Automatic Stays: "The automatic stay is one of the fundamental debtor protections provided by the bankruptcy laws. It gives the debtor a breathing spell from his creditors, stopping all collection efforts, all harassment, and all foreclosure actions. It permits the debtor to attempt a repayment or reorganization plan, or simply to be relieved of the financial pressures that drove him into bankruptcy. Notes of Committee on the Judiciary, Senate Report No. 95-989"

While the automatic stay is temporary it may give you the relief you need to get through the bankruptcy process. As with any legal matter you should discuss all of your options with your attorney and make a fully informed decision.

If you are struggling with bankruptcy or harassing collection calls, contact the offices of Attorney Erwin F. Meiers today.

Experiencing increasing calls from debt collectors?

Are incessant phone calls from debt collectors and credit counseling companies driving you nuts? Are you stuck in a rut and the bills are piling up?

Have you considered bankruptcy?
Bankruptcy is a debt solution available to help you start back on the track to financial freedom.

What is bankruptcy?
Bankruptcy is an option available to consumers who cannot afford to repay debts owed. The most common type of bankruptcy filings are Chapter 7 and Chapter 13. Chapter 7 is a form of bankruptcy in which the debtor must liquidate their assets. Whereas, Chapter 13 allows the debtor to retain their assets while making scheduled payments on the debt.

How will it affect my credit score?
While filing for bankruptcy will appear on your credit report, it doesn't mean your credit has been compromised entirely. With good payment history after bankruptcy you may be eligible to apply for lines of credit after only a few years.

As with any legal matter make sure you obtain professional advice prior to making a decision. You have questions, we have answers. Contact us to discuss your bankruptcy options.