January 20, 2015 — Report

Creditors increasingly sell charged-off debts to debt buyers rather than trying to collect on the accounts themselves. Debts may then be resold again and again between debt buyers with each owner potentially attempting to collect on the accounts. Over the course of these sales and collection attempts, the debts inevitably age. Consumers are routinely confronted with these “zombie debts” that reappear for collection years after the original transaction. This report outlines problems related to “zombie debts” and a set of solutions for the CFPB to adopt.