" Some debts aren’t worth paying back. Ever heard of ‘zombie debt’? "
You have a responsibility to repay the money you borrow.
However, sometimes life interrupts — you unexpectedly get laid off or a medical crisis limits your ability to earn a living.
This disruption to your income makes it impossible to keep up with your debt payments.
Then the collection calls start. The chase for payments may start cordially, but eventually the threat of legal action accelerates. Here’s why.
Debt collectors have a limited number of years in which they can sue for repayment. After the time runs out, certain unpaid consumer debts, such as credit card charges, fall under a statute of limitations. Under the federal Fair Debt Collection Practices Act, once the legal deadline expires, the debt is “time-barred,” and the collector is prohibited from suing or threatening to sue.
The statute of limitations for time-barred debt dictates how long a creditor or debt collector has to sue you to collect payment, and this can vary by state and the type of debt.
This does not mean a debt collector will not pursue you for payment. Old debts can come back to life after a long period of inactivity. This “zombie debt,” as it’s called, can be revived by unscrupulous debt collection companies, which often try to scare or trick debtors into restarting the statute of limitations.
More Information at:
https://www.msn.com/en-ca/money/personalfinance/some-debts-aren-t-worth-paying-back-ever-heard-of-zombie-debt/ar-AA1K0oDy?cvid=5ca0c599e7b2441ca2555e6d39768d1d