Consumers generally not responsible for 'zombie' debts - CBS 5 - KPHO

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Consumers generally not responsible for 'zombie' debts

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Consumers need to beware of zombie attacks. Not the walking dead, but dead debt that comes back to life. Most times you don't owe a cent, even if the debt is real.

What do you do when a rogue debt collector sends you a letter demanding payment on a really old debt? It happened to Debi Rockey.

"This was an attempt to collect a debt and I owed Arrowhead Hospital $300," Rockey said.

Rockey remembers her brief hospital stay and says she paid that debt in full back in 2002. But now, it's come back to life, it's a 'zombie' debt, and the collection agency wants her to pay again.

"You've got to be kidding. This was like thirteen and a half years ago, how am I going to prove to them that I paid this," Rockey said.

Rockey called the collector asking who has records from 2001 laying around. She says the collector didn't care how long ago it was, it was her responsibility to prove that she paid it.

"I was talking to my dad and I said I think I'm going to contact Dave Cherry and see what he says about that," Rockey said.

Rockey doesn't have to prove anything. Arizona Revised Statute 12-548 sets a six-year limitation on debts. Meaning if a debt has not been collected within six years of first default, the consumer is under no obligation to pay, even if the debt is real.

But some people decide not to fight zombie debts. They figure the amount of money isn't worth the effort. That's a bad idea, know your rights instead.

"If it's over six years old, then you don' have to worry about it, it's just too old, they've wasted their opportunity," Rockey said.

Arizona Revised Statute 12-548 does not apply if a judgment or lawsuit was filed against you; in those cases the debt remains valid indefinitely.

But with contract debt, including credit cards, if creditors don't get you to pay within six years of when the debt first goes into default, they have the right to keep asking, but you are under no obligation to pay.

In this case, the collector cannot make a negative notation on your credit report; it is not legal. If they do anyway, file a dispute with the credit bureau and it should be removed right away.

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