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by: JRRooney
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Like the phoenix that rises from the ashes, so does so-called zombie debt. A consumer may think it's dead, but it keeps coming back to haunt.

"Zombie debt is a phrase to describe all debt that a consumer had forgotten about or never even owed that comes back to haunt them," said John Monderine, of Rapid Recovery Solution, Inc.

Joan Baker has been tormented for years as collection agencies hassled her about debt that was not even hers to begin with. More than a decade ago Baker was the victim of identity theft and since then debt collectors have not let her rest.

"It is a nightmare. It won't go away," Baker said. "I had knots in my stomach. I was on the phone for hours."

Baker reported a fraudulent $5,000 charge and still the bill collectors were relentless. When she refused to pay, they went after her credit rating. Each time she cleared her name with one agency, the cycle started up again because her debt had been sold to a different bill collector.

Baker finally reluctantly sued the aggressive collection agency for fraud five years ago. Baker was awarded $40,000.

Baker is not the only one this has happened to.

When Larry Randazzo missed a Verizon bill for 11 cents, it mushroomed into $4,000 seven years later.

Randazzo said the collector backed off when he made it clear that he knew his rights.

"If they are going after me, someone who has the resources to fight them, what are they doing to people who don't understand their rights?" he said.

"I think what I did was make them aware that I was aware," Randazzo said.

Most banks sell debt. For example, an institution might sell a credit-card debt worth $10,000 to a collection company for only $100. Then, the agency turns around and aggressively tries to collect and whatever it receives is mostly profit.

This year more than $100 billion of "junk debt" is expected to be bought and sold on the open market, according to a report by debt collection advisory Kaulkin Ginsberg. A debt collection trade association said it polices its members.

"Once we determine that the complaint is against a member of ACA International, what we do is seek to work with the consumer and the debt collection agency to identify a solution," said Rozanne Andersen, executive vice president of the Association of Credit and Collection Professionals.

How to Protect Yourself

First, ask for something in writing.

Consumers should recognize a statute of limitations exists and varies from state to state. Many allot about seven years where you cannot be sued or have your credit rating destroyed.

"If a consumer knows the debt is past the statute of limitations, they should not pay it," said Mauro.

Also, you should never let a collector debit your account because the money can often be difficult to get back.

About the Author

JR Rooney is an expert in the Collection Agency industry. If you need a free quote from a Collection Company try Rapid Recovery Solution, Inc. Get a totally unique version of this article from our article submission service

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