No one likes to cope with problem debt. Individuals do not like to pay it and creditors and collectors don’t like to collect it. But debt is what makes our modern society work, as few people are able to pay with cash. It’s not a problem most of the time, as the vast majority of individuals pay on time. Sometimes, those debts go unpaid, and when that occurs, creditors notify the credit agencies and the delinquent debts are noted on the client’s credit rating. The notation will stay there until the debts are repaid, or until seven years go by, whichever comes first. After seven years, the debts, paid or not, vanish from the borrower’s credit rating.

Occasionally, though, those debts come back, like zombies in a horror movie. If your debts go unpaid for a long enough period of time, your loan company or creditor will ultimately write off the debt as a loss. They will then sell those debts to collection institutions, frequently for a fraction of their value. The collection corporations try their ideal to collect some of the unpaid funds. If they get anything at all, they come out ahead. Occasionally, those collection firms will report those debts to the credit reporting agencies as though those debts were new ones, rather than old, uncollected bills. Officially, doing so is known as “re-aging.” Unofficially, it is known by the weird name of “zombie debt.”

Zombie debt is illegal; debt is supposed to be reported to the credit bureaus simply once. After seven years or repayment, those debts are supposed to be gone forever. Collection agencies re-age the debt in order to put extra pressure on the consumer to pay back. In the end, having a new notation seem on your credit rating years after the fact will not make anyone happy. The bureaus hope that debtors will be sufficiently scared by the new notation on their credit score to offer to settle the debt. In return, the collection firm will report the bill as paid, thus eliminating the black mark.  In other words, creditors create zombie debt as a form of blackmail; threating their customers with a bad credit score if they don’t pay their bills.

What can a consumer do about zombie debt? If you have proof that the bill has been paid, that more than seven years have elapsed or that the debts were dismissed in bankruptcy court, you can submit proof to the credit agencies. That should be adequate to get them to remove the notation. If you neglect to do so, you will have to endure a different seven years of bad credit and unfavorable loan terms unless you pay off the debt.