What is Zombie Debt?

15 AUGUST 2023

Zombie debt is either debt that has previously been settled, is no longer collectable, or actually belongs to someone else.Man using calculator with receipt in handZombie debt is debt that has either returned to haunt you after being paid off, is too old to be collected, or belongs to someone else entirely. In essence, debt collectors are attempting to recover funds without having the legal authority to do so. Also, be aware that if you fall for the scam and pay even a single cent toward your zombie debt, you're essentially allowing the debt collectors to pursue collection! At this point, you're probably thinking, "There is no way I would pay back a loan that isn't mine", but you'd be shocked at how frequently this strategy actually works. Otherwise, why would they even try?

So is Zombie Debt as scary as its name? Unfortunately, yes it is! This is a type of debt that quite literally returns from the debt grave. It is debt that has disappeared from your credit record but is still being pursued for collection for a variety of reasons. Zombie debt might emerge if a debt collector tries to collect on it once more.

How Do Zombie Debt Collectors Operate?

You shouldn't be shocked by some of the methods used by zombie debt collectors. They only have one task, which is to find debtors and demand payment. In order to ensure they succeed, they will take extraordinary measures and be quite intimidating. It's also not always legal for debt collectors to use certain methods. Here are some of their known tactics:

They will try to get information out of you

No matter how many times they ask, you are under no obligation to answer. Avoid sharing if a caller requests your ID number, current residential or work address, or any such personal information. A legit lender already has the information they require if you are in fact obligated to pay a loan.

They could flat out lie to you

They may not hesitate to embellish the truth. They could misrepresent facts to recover your money. They particularly like to tell you that you owe more money than you actually do, pose as someone they're not, warn you that you're going to jail, and other things.

They may threaten and harass you

Zombie debt collectors may threaten to sue you, harass your family members or friends, or, in extreme cases, even threaten you physically.

How can you protect yourself?

Debtors have rights under The Debt Collectors Act, No, 114 of 1998

The "DCA” governs debt collection processes in our country by providing for the establishment of the Council for Debt Collectors, mechanisms for the regulation of the debt collections sector, and all other matters related to the collection of debt.

This particular regulation governs the conduct and activities of third-party debt collectors, as well as the ways and means by which they may contact debtors, the hours of the day during which contact may be made, and the frequency of such contacts.

The most crucial thing is to avoid talking on the phone for too long with the zombie debt collector. Ask for their address and send them a signed letter. Ask them to show you the debt validation letter in order to refute your obligation to pay it. If the debt collection company continues to approach you, send them another letter stating that you will only communicate with them in writing or in the event that they file a lawsuit against you. When a debt is prescribed, they will likely leave you alone.

If you're getting calls demanding payment, you could be a victim of identity theft. That implies that someone else might be incurring debt in your name. Check your credit profile regularly to make sure all the debt in your name is legitimate. The best way to combat zombie debt collectors is to know exactly how much money you owe (and to whom). If they call, you'll be able to tell if they're trying to collect on a debt you've already paid off, or worse, a debt that was never yours. Keep contracts, settlement statements, and payment records in a safe place for when this happens.