What is Zombie Student Loan Debt?

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Kristen Kuchar

By Kristen Kuchar

May 9, 2020

Zombie student loans are old student loans that come back to life. A zombie student loan is a student loan that someone is trying to collect from you that has either been paid off, discharged or forgiven, or wasn’t borrowed by you.

Why Does Zombie Student Loan Debt Happen?

There are several reasons you could encounter zombie student loans.

  • Loan records could be incomplete, and not have documented that the loan was paid or cancelled.
  • If a lender sold your debt to another creditor, it may not have been documented that it was paid or cancelled.
  • You may have been a victim of identity theft, and someone has borrowed a loan in your name.

The lack of a statute of limitations on federal student loans contributes to the existence of zombie student loans. Private student loans are still subject to a statute of limitations.

How to Prevent Zombie Student Loan Debt 

  • Keep a copy of all records of payment and note when your student loans are paid in full. Most lenders will provide you with a paid-in-full statement showing your loan balance is zero and a copy of the loan promissory note marked as paid-in-full. Keep these forever.
  • If you are cosigning a student loan, be aware of the risks and that you are legally responsible to pay the loan. For cosigners, keep tabs on payments being made and when the loan is paid in full.
  • Some zombie student loan debt is caused by identity theft. To prevent this, keep your information secure. Only give out your social security, birthday, and full name when you absolutely need to and can confirm it’s legitimate. Consider freezing your credit.
  • Check your credit reports for free every year, at annualcreditreport.com, looking for new loans and resurrected zombie student loans.

How to Deal with Zombie Student Loan Debt

  • Don’t make a payment if this debt isn’t yours. Any payment made can reset the clock on time-barred debt and make it more difficult to prove that the debt isn’t yours. Do not make a “good faith” payment or otherwise acknowledge that the debt is yours.
  • Send a certified letter to whoever is trying to collect this debt. Ask for proof that the debt is owing, the amount of debt and any mandatory information, including the original lender.
  • Dispute the debt with the credit bureaus. The lender must verify the debt within 30 days or it will be removed from your credit reports.
  • Gather any proof you can that this debt was paid off or it is not yours, including loan statements, receipts and payment confirmations.
  • If you are sued, show up in court, preferably with an attorney. If you don’t show up in court, the lender will get a court judgment against you, even if you don’t actually owe the debt or the debt is time-barred. 

A good place to start:

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