Beware Of Zombie Debt Collectors
Amy Fontinelle, Investopedia
Have you ever received a letter or phone call asking you to pay a debt that you're not sure you owe? If so, you may be the target of zombie debt collectors. What is zombie debt? How does it rise from the dead? What you can do if zombie debt starts its relentless lurch toward you?
It has become increasingly common for companies to sell their old, uncollected debts for pennies on the dollar to third-party debt collection agencies. Credit card companies, telecommunications companies, gyms and health care facilities want to get these bad debts off their books, so after a period of several months of nonpayment, they will turn your bills over to a debt collection agency. Sometimes the debt is sold to the collector, which gets to keep every penny it collects, and sometimes the collected debt is returned to the original creditor with the collection agency retaining a fee or a percentage of the collected debt as compensation.
Read the full article here http://www.forbes.com/2008/10/31/debt-creditors-default-pf-education-in_af_1031investopedia_inl.html