Fighting the zombies

Several times a week, I find myself beset by zombies - of the dead bill variety. Sometimes they lurk in the mailbox. Other times, the phone rings, the caller ID tells me the number is an 800 number or the dreaded "Unknown Caller", and then I will hear a hollow "hello...hello..." on the answering machine.

When I was in college, I got myself in over my head with bills. I paid what I could, but some store charge cards had to be pushed to the wayside in favor of buying groceries or paying the gas bill. Some of the debt from these cards were "charged-off" by the credit card companies (meaning they claimed a loss on their tax returns) after unsuccessful attempts at collections. After some years passed, these bills essentially became "dead", which means that the legal statute of limitations for the period in which debt collections can occur on the bills in my state had expired.

Somewhere after that, though, these unresolved debts were resurrected by the companies that wrote off the debt (a sketchy practice at best) and sold - for pennies on the dollar - to companies whose sole purpose is debt collection. And so, these bills "rose" from the dead to lurk about my mailbox and answering machine.

Except, they didn't really. The statutes are still lapsed, and all of my credit reports verify that these debts don't exist, and may never have existed in the first place. The companies that perform the sleight of hand and a little voodoo try to make people like me - who once fell behind on their bills, caught up again, and value their current good standing - think their credit report's good standing will be ruined, or worse, they will be prosecuted for these old debts.

The companies especially take delight in resurrecting these dead bills when the individual in question is about to buy a house (they check your credit report for signs that you recently pre-qualified for a mortgage) or other large financial undertaking. These are the times when consumers feel most vulnerable about their credit score.

But, I know my rights. If the statute in your state is expired, you have no obligation to respond to the collection agency. If you do respond (even if you just say "I paid that!"), you risk the resurrection becoming legal and the bill once again collectible. The best recourse is to write a letter to the offending agency, and tell them that you don't know what they're talking about and to stop trying to contact you. They're required by law to cease and desist immediately upon receiving such a letter, unless they have proof the debt is still valid. Just make sure you have a return receipt accompany any such correspondence you send to debt collectors to prove they received it.

I don't in any way condone running away from your bills. And, just a warning to anyone who thinks that sounds like a good recourse, it can take many years for a bill to die. You risk being sued in the meantime by your creditors, so it's better to try to work something out with them if you can. In the event a bill dies a legal death, however, you need to know and enforce your rights. (For more information on "zombie debt" and how to handle it, check out this article.)

Don't let the zombies haunt you. Fight back!

Penn