Tweet
Nightmare of the Zombie Debts!
Oh noes!
All is not lost, however. Most states have a statute of limitations for suing over old debts. http://www.bankrate.com/brm/news/cc/20040116b1.asp. Also, the Feds don't allow posting of inavtive debts over seven years old to credit reporting agencies. This doesn't stop the zombie debt companies from trying to do so (and you are the one who has to stop them).
Know your rights!
A decade ago, most people who reneged on debts could rest easy after several years passed, since few creditors tried to collect on old bills, particularly for small amounts.
Today, however, collecting on old debts is a rapidly expanding industry. Aggressive companies can buy charged-off credit card accounts from the original lenders for pennies on the dollar. Then, they use credit scoring and other new technologies to identify which debtors are most likely to pay. The players in this “junk debt” market range from fly-by-night outfits to well-established companies funded by Wall Street investors.
It’s a business that barely existed 10 years ago. In the last three years, it’s been growing at a 30% annual rate, according to credit industry analyst Sean McVity of Keefe, Bruyette & Woods. Among the signs of the industry’s maturity:
Four debt-buying companies have gone public in recent years, including Asset Acceptance of Warren, Mich., which had its $150 million IPO in February.
Some buyers have attracted major funding from investment banks such as Bear Stearns and Goldman Sachs.
Last year, more than $75 billion in old debts were sold.
Today, however, collecting on old debts is a rapidly expanding industry. Aggressive companies can buy charged-off credit card accounts from the original lenders for pennies on the dollar. Then, they use credit scoring and other new technologies to identify which debtors are most likely to pay. The players in this “junk debt” market range from fly-by-night outfits to well-established companies funded by Wall Street investors.
It’s a business that barely existed 10 years ago. In the last three years, it’s been growing at a 30% annual rate, according to credit industry analyst Sean McVity of Keefe, Bruyette & Woods. Among the signs of the industry’s maturity:
Four debt-buying companies have gone public in recent years, including Asset Acceptance of Warren, Mich., which had its $150 million IPO in February.
Some buyers have attracted major funding from investment banks such as Bear Stearns and Goldman Sachs.
Last year, more than $75 billion in old debts were sold.
All is not lost, however. Most states have a statute of limitations for suing over old debts. http://www.bankrate.com/brm/news/cc/20040116b1.asp. Also, the Feds don't allow posting of inavtive debts over seven years old to credit reporting agencies. This doesn't stop the zombie debt companies from trying to do so (and you are the one who has to stop them).
Know your rights!
I saw one $10,000 car, which would cost $40,000 in payments once interest was figured in. 
Comment