In our society, some types of debt can be good. Having a high credit score depends on having a responsible credit record that includes a normal amount of debt for your income level. This is called your debt-to-income ratio. 

44% of Americans rely on a car loan when buying a vehicle. 63% have a home mortgage. Paying these types of bills monthly and on time raises your credit score.

However, when you have debt that you can’t pay and the company that you owe stops contacting you, the debt can go on your credit report as “bad debt”. This kind of debt can drag your credit score down.

Bad Debt is often sold to debt collection agencies who get aggressive and abusive in their tactics to collect from you. They buy your debt from the original company for next to nothing and they stand to profit outrageously if you pay up.

What is Zombie Debt?

There are many types of Bad Debt that can cause dramatic drops in your credit score. However, zombie debt does not affect your credit score when you don’t pay.  Zombie Debt is old debt that can no longer affect your credit score.

Some examples of Zombie Debt include:

  • Debts you do owe but forgot about for years
  • Debts you already settled with a creditor
  • Fraudulent charges from identity theft
  • Debts wiped out in bankruptcy
  • Debts beyond the statute of limitations for when you can be sued for payment (1)

Don’t Resurrect Zombie Debt

Know what kind of bad debt you are dealing with before paying up. Don’t let a debt collection agency trick you into thinking you should start making payments on a zombie debt.

One small payment is all it takes to resurrect your debt and cause you more trouble than you can imagine. Read on to find out why you should never pay zombie debt. 

The “Statute of Limitations”

Bad Debt can only stay on your credit report for so long. Eventually it falls off your report and no longer negatively affects your credit score. This “statute of limitations” is generally “between three and six years, but it can be as high as 10 or 15 years in some states.” (2)

Once your debt is past the statute of limitations for your state, you can no longer be sued for the amount you owe and it no longer affects your credit score! 

Reasons NOT to Pay

There is no reason to pay debt that is beyond the statute of limitations. In fact, paying any amount toward your debt can resurrect the zombie debt to again. If you make a payment toward bad debt that is now past the statute of limitations:

  • The statute of limitations starts over!! This means another 3-15 years of owing this debt! 
  • The debt goes back on your credit report. Your credit score goes down instead of up. 
  • The debt collection agency can now sue you in a court of law. In some states, if a judge declares you must pay and you don’t pay up, you can even go to jail.

The important thing is to never pay zombie debt because you can resurrect the debt to reappear on your credit report causing bad credit and the possibility of being sued!!

How to Deal

If you are harassed or verbally abused by a debt collection agency, know your rights. Because of the Fair Debt Collection Practices Act, debt collectors are restricted in:

  • The ways they can contact you
  • The time of day they can contact you
  • The number of times they can contact you

If you are contacted, ask for verification of the debt. Debt collection agencies often contact the wrong person or ask for the wrong amount when collecting debts. Don’t pay a debt you don’t owe or that is the wrong amount just because you are worried about the lies or manipulations of a debt collecting agency. Don’t ever pay a debt past the statute of limitations.

Instead, get the name and address of the company and send them a certified letter disputing the debt within 30 days of the phone call. If they continue to harass you, write them again and demand that they only speak with your lawyer. Contact one of the consumer protection attorneys at LawZebra and let us handle the situation according to the law.

Seek Help

If you are harassed by a debt collection agency about a zombie debt, follow the procedures above, but also ask for help if you need it. Often, a knowledgeable consumer rights attorney can walk you through the steps to take to be free of the harassment and abuse from debt collectors for good. Debt collection agencies will continue pushing until you show them that you are serious about your consumer rights. Make sure that they know that you will not be bullied into paying their bills with your hard earned money.


  1. https://www.nerdwallet.com/article/finance/arm-yourself-against-zombie-debt 
  2. https://www.thebalance.com/state-by-state-list-of-statute-of-limitations-on-debt-960881#:~:text=Each%20state%20has%20its%20own,of%20limitations%20for%20your%20state.
  3. https://www.investopedia.com/terms/z/zombie-debt.asp