zombie debt Tag

05 Mar Am I Responsible for the Debts of my Deceased Spouse or Other Relatives?

Losing a loved one can be very difficult, especially if your spouse or other loved one dies unexpectedly.  What happens to debts owed by the deceased after his or her death? Laws vary from State to State, but in many cases the departed's estate becomes responsible for outstanding debt.  However this does not necessarily mean that the deceased's next of kin will get nothing from the estate.  Many States have special provisions that allow the immediate next of kin to take money from the estate when that money is used for support and maintenance.  In Georgia, where I practice, this right is known as a "year's support" and can be a tremendous help to surviving relatives. If you are facing an unexpected financial crisis brought about by the death of a loved one, you should seek counsel before paying any debts owed by the deceased or his estate. What if your deceased relative has no assets to make up an estate?  In that case, a surviving spouse or child does not owe anything to creditors of the deceased. 
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29 Dec Debt Does Not Die When You Do, Part Two

Surprise, you're dead. Distinct from 'zombie debt' which should be dead, but refuses to die, your debt does not automatically die when you do. Your family or heirs could be forced to pay the bills that you didn't (or couldn't) pay before you moved on to another plane of existence. You might want to read Part One of this series.

So the widow said to me, "Don't you just write a letter to the credit card companies and make them stop sending bills?" It's not always that easy. If you have a debt that is only in your name and you die without any assets, then maybe those debts would die too. But that is a loaded statement. Let's break it down.

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04 Sep Zombie Debt, Being Sued by a Debt Buyer

You read the papers and a company you never heard of, say, Asset Acceptance, is suing you. They bought the bad debt from a credit card company. This is now a multi-billion dollar industry, big banks and credit card companies sell charged off debt, that is, debt they cannot carry as an asset on their books, to companies that buy bad debts for pennies on the dollar, then try to collect them. What did they get? The debt buying company gets a one page computer printout with your name, account number, and a balance. No contract between you and Capital One, or, whoever. No statements. Not even a breakdown of the principal, interest, late charges, an accounting of how the total balance was calculated.
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26 Jun Bankruptcy : Why Do I Need To Save My Papers?

You need your bankruptcy papers are a shield against future collection actions for discharged debt. The answer is asimple phrase: "zombie debt". Zombie debt is the phenomenon of old and discharged debt being revived by debt buyers and debt collectors long after the debt has been rendered uncollectible. Check out Zombie Debt Haunts the Discharged and Zombie Debt.

Another reason: refinances or purchases of real estate.

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28 Mar Can Settled Debt Hurt My Credit Rating?

The secret to settling debt with your creditors is assure finality. You want to make sure that the debt never comes back. (Read: Zombie Debt Haunts the Discharged and Zombie Debt.) Can debt be settled? Absolutely. However when you negotiate to settle your debt you must make sure that the creditor reports it properly on your credit report.

Will settled debt hurt your credit score?

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