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Law Offices of Carol M. Galloway, P.A. Jacksonville Bankruptcy Lawyer
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What is Zombie Debt?


Zombie debt is the colloquial term for debt that falls outside the statute of limitations. In Florida, as in all states, debts have a statute of limitations. Creditors have five years from the date at which the debt was incurred to file a lawsuit against you to recover that debt. Debt that falls outside the statute of limitations can never be the subject of a lawsuit. In this manner, an individual may be able to avoid debt repayment. The creditor can’t do anything to recover the debt from the debtor.

In most cases, creditors will sell expired debt for pennies on the dollar to collection agencies that will then attempt to recover the debt.

Reviving zombie debt

 Since the debt is expired, there are no legal means for the creditor to recover the debt. So, they sell the expired debt to a collections agency which then begins a campaign of harassment and calling you. They will say that you still owe the money and if you make even a 1 cent payment on the debt, it will be revived and the statute of limitations will begin ticking down again. You should never attempt to repay an expired debt. This can rehabilitate the expired debt and you could face a creditor lawsuit from the collections agency that tricked you into reviving the debt.

Types of zombie debt 

  • Settled debts – These are debts that have already been discharged in bankruptcy. Creditors sometimes attempt to scare you into repaying these debts. You can use your bankruptcy as proof that you no longer owe them.
  • Time-barred debts – These are debts like those mentioned above that have fallen outside the statute of limitations. Creditors have 5 years in Florida to attempt to collect a debt for written contracts and promissory notes. For credit cards, the statute of limitations is four years. Once those 4 or 5 years lapse, the creditor is no longer able to recover the debt by means of a lawsuit. However, the Florida statute of limitations for judgment collections is 20 years from the date of the judgment.
  • Debts that are no longer on your credit report – Debts fall off your credit report after 7 years. You should never pay on a supposed debt that does not appear on your credit report.
  • Debts that don’t belong to you – In some cases, creditors attempt to recover debts from individuals who never incurred them. This can be a mistake on their end, or you might be the victim of identity theft.

Collections agencies will use all manner of tactics in a bid to recover a debt. In these cases, they may threaten or lie to you about the debt still being active. They aren’t legally allowed to do this, but often, the individual facing harassing phone calls doesn’t know any better. They cannot threaten to sue you if they have no legal right to do so.

Talk to a Jacksonville Bankruptcy Attorney Today 

The Law Offices of Carol M. Galloway represent the interests of those who need to file for bankruptcy. Call our Jacksonville bankruptcy attorneys today to schedule a free consultation, and we can begin discussing your next moves immediately.

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