Zombie Debt

Zombie debt is a term used to describe debt that is still being collected on, even though the borrower is either deceased or in default. This can happen when a borrower dies and their estate is unable to pay off their debts, or when a borrower simply stops making payments and the lender continues to collect on the debt.

Zombie debt can be a problem for both borrowers and lenders. For borrowers, it can lead to negative credit reports and collection actions, even if they are no longer able to repay the debt. For lenders, it can be difficult to collect on zombie debt, and they may end up writing off the debt as a loss.

There are a number of ways to deal with zombie debt. For borrowers, it is important to try to resolve the debt as soon as possible. This may involve contacting the lender and working out a payment plan, or filing for bankruptcy. For lenders, there are a number of collection agencies that specialize in collecting on zombie debt.

Zombie debt is a complex issue, and there is no easy solution. However, by understanding what it is and how it can affect you, you can take steps to protect yourself from it.

Here are some additional details about zombie debt:

• Zombie debt can be a significant problem for consumers. In 2018, the Federal Trade Commission (FTC) received over 2.5 million complaints about zombie debt.
• The average amount of zombie debt per consumer is $1,000.
• Zombie debt can be collected on for many years after the borrower has died or defaulted.
• There are a number of laws that protect consumers from zombie debt. These laws include the Fair Debt Collection Practices Act (FDCPA) and the Consumer Financial Protection Act (CFPA).
• If you are being harassed by a debt collector, you should know your rights under the FDCPA. You can also file a complaint with the FTC.

If you are concerned about zombie debt, you should contact a qualified debt relief professional.