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Texas Lawmakers Fighting “Zombie” Debt Collectors

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Texas lawmakers are fighting against what are being called “zombie” debt collectors. In 2019, lawmakers passed a bill that would protect consumers from being tricked into paying old debts, sometimes called “zombie debts”. Texas Governor Greg Abbott signed the bill into law and it is slated to take effect on September 1, 2020.

Zombie debt collectors

For consumers, zombie debts are like a nightmare that resurfaces years later. These are debts that are considered “dead” but can be revived by a creditor years later. Texas law allows four years from the date of the last payment for creditors to take action. That includes filing a lawsuit. After that four year statute of limitations, the debt is considered dead. It can, however, appear on the consumer’s credit report for up to seven years.

The debt being removed from the credit report does not mean that it is forgiven, or that the creditor will not attempt to collect. The creditor may sell the debt to a collection agency or write off the debt. Some creditors can even forgive the debt, which requires the consumer to pay taxes on the forgiven amount like income.

Fighting Back Against Zombie Debt Collectors

What the new law means for consumers is that they will have more protection from zombie debt collectors. Third party debt collectors will be unable to re-start the clock on certain debts after the statute of limitations has expired.

House Bill 996, or the Fair Consumer Debt Collection Act, offers protection for consumers with dead debts. These protections include:

  • Debt collectors cannot sue consumers after the statute of limitations expires.
  • Even if the consumer makes a payment (acknowledges the debt), the statute of limitations will not be revived.
  • Any paperwork given to debtors after the expiration of the statute of limitations must include the statement: “The law limits how long you can be sued on a debt. Because of the age of your debt, we will not sue you for it and we will not report it to any credit reporting agency. This notice is required by law.”
  • Any paperwork given to debtors before expiration of the statute of limitations must include the statement: “The law limits how long you can be sued on a debt. Because of the age of your debt, we will not sue you for it. If you do not pay the debt, (NAME OF DEBT BUYER) may continue to report it to the credit reporting agencies as unpaid for as long as the law permits this reporting. This notice is required by law.”

These protections are designed to protect consumers and provide more information about the debt being collected. Protections are also focused on consumers who may not realize they have a debt. Also, there are protections for those who may not be legitimately responsible for the debt.

Protect Yourself from Zombie Debt Collectors

Finding out years after-the-fact that you still have certain debts can be alarming. It can cause you to be anxious about your finances and the possibility of being sued. The good news is that there are laws designed to protect consumers from zombie debt collectors. To learn more about your rights, call Daic Law. Let our debt defense lawyer in Texas help you fight off old debt and ensure that your financial future is secure. Cal us at 877-893-6040, email us at, or schedule a consultation on our website. Daic Law serves clients in Houston, Dallas, Austin, and San Antonio, and surrounding areas.

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