Although it sounds like the title from a bad movie, zombie debt is a real problem for modern consumers. It refers to a financial obligation that has been charged off or otherwise removed from a creditor’s books because the lender could not afford to pay it or could not be located.

The majority of creditors simply stop trying to collect once a debt is six years old because it has passed the statute of limitations and the party who owes it is no longer legally required to pay. Collection agencies that specialize in “junk” or zombie debt purchase these accounts for a fraction of their face value and proceed to try collecting it, even if the statute of limitations has passed.

Zombie debt buyers pay so little to acquire the accounts that settling them for even a minor percentage of the amount originally owed represents an attractive profit. Money Crashers estimated that these companies purchase junk debts for approximately 3% of the original value, so if the debt was $3,000, a collector will typically pay $90 for it. If that company can get the original debtor to settle it for half the amount owed, then they realize $1,410 in pure profit.

What to do if a zombie debt collector contacts you

Although a debt will remain valid for years, you are not legally required to pay it after the statute of limitations has passed. The statute begins on the last day that the debt experienced activity (usually the last payment). The Fair Debt Collection Practices Act, or FDCPA, states that no one can sue you to collect the debt after six years have passed, and after seven years, the debt must be removed from your credit report.

If a zombie debt collector calls you, then do not acknowledge ownership of the debt. Politely but firmly ask for the company’s address and send them a certified letter that disputes the debt and requests proof that you owe it. Until you receive this debt validation or proof that a judgment has been issued against you, do not contact or speak to the collection agency at all.

If the collection agency actually sends you the requested information, then review it carefully. Zombie debt has been known to result from a genuine error or a deliberate case of identity theft. Unfortunately, it can also be part of a collection scam in which fake collectors try to get you to pay debts that don’t exist.

Zombie debt collectors have been known to use deception, harassment, and intimidation to get their targets to the debt. Some will even file lawsuits because they bank on the fact that many consumers are unaware of their rights where zombie debt is concerned. If you ignore the suit, then they could seek a default judgment and garnish your wages.

If you are being hounded by zombie debt collectors, then contact a New York attorney with experience in FDCPA matters. When collection agencies cross the line, your attorney can help you stand up for your rights and take the company to court, where it could be ordered to pay you $1,000 per FDCPA violation. Jayson Lutzky is a Bronx, New York lawyer who handles personal bankruptcy cases. If you are looking for a fresh financial start, then contact his office at 718-514-6619 to set up a free in-person initial consultation. Visit to learn about Mr. Lutzky’s 33+ years of experience.