Zombie Debt: Run, Hide or Stand Your Ground?

Have you received a call or letter demanding you pay an old debt that either you forgot about, paid off, or is simply not yours? AHH! You may be a victim of “zombie debt collection”.

Zombie debts typically show up for various reasons:

1.      Sometimes they are debts that are either very old and/or no longer owed – past the statute of limitations (SOL) for legal action in your state, which is usually between three and six years. 

2.     You may have forgotten about the debt or had previously settled on the debt with either the original creditor or another collection agency.

3.     The debt is a result of identity theft.

4.     You filed the debt with a bankruptcy filing and it was discharged.

The biggest issue with these zombie debts is that individuals are pressured into paying the debt, which they may not even need to pay! The first step is not to acknowledge the debt, but request verification that the debt is in fact yours, and that you may be required to pay. Let the collector know that you would like to “validate” the debt prior to discussing it any further; obtain their name and address…then hang up the phone and end the conversation.

o       Send a debt validation letter, certified return receipt requested (this way you know they received it). The collection agency will have to give you proof of the debt, such as the original creditor with account number, the original balance when it was sent to collections, any interest or fees that have been charged, along with any payments applied to the debt since being sent to collections. They must also provide you information on how you can continue to dispute the debt, if necessary.

BEWARE! Be advised that if you acknowledge that you owe a debt, or agree to make a payment for any amount, then it could reset the statute of limitation and you could be legally responsible for this bill, even if it’s not yours. 

Keep your zombie debts in their grave this year!

Consumer Credit Counseling Service Will Help Excluded Workers in WNY; Selected to Help Administer New York’s Excluded Workers Fund


Call 716-712-2060 or visit www.consumercreditbuffalo.org


Consumer Credit Counseling Service (CCCS) announced today that it is working to secure workers’ benefits for those who have been excluded from the federal stimulus efforts.

CCCS is one of only three Western New York organizations selected by New York State to help individuals access financial help through the all new Excluded Workers Fund — the first of its kind in the nation.

The Excluded Workers Fund (EWF) provides financial assistance to New Yorkers who lost income during the COVID-19 pandemic and were left out of various federal relief programs, including unemployment and pandemic benefits, according to the New York Department of Labor https://dol.ny.gov/EWF

Those who were unable to access unemployment and/or any other pandemic benefits include undocumented adults and those with nontraditional jobs.

The EWF officially began as of August 1st after its approval in the New York State budget this spring. It is a fund of approximately $2.1 billion and can provide benefits of as much as $15,600 per worker.

Applications for the EWF are available in 13 different languages and applicants are strongly encouraged to apply online. Applications will not be accepted by mail. CCCS encourages all those who believe they may be eligible to visit https://dol.ny.gov/EWFApply and to contact CCCS at 712-2060 for any help that is needed.

To be eligible to receive benefits from the EWF program, applicants must show they:

  1. Lived in New York State before March 27, 2020, and continue to live in New York State;
  2. Are not eligible for and did not receive unemployment insurance or any other COVID-19 income relief or other specified benefits from the state or federal government;
  3. Earned less than $26,208 in the 12 months prior to April 2021; and
  4. Lost at least 50{0c9682ed421d1a35ec2634820749f3f5f3c1b2afa912a968052e88034851fe41} of weekly work-related earnings or household income at any point in time between February 23, 2020, and April 1, 2021 due to total or partial unemployment, or inability or unavailability to work due to the COVID-19 pandemic or, became responsible for a majority of their household income due to death or disability of the head of household.

CCCS also offers credit counseling services and urges WNY residents to  contact them with their financial concerns at 712-2060 or www.consumercreditbuffalo.org. CCCS will assist individuals to attain financial stability and security.

About CCCS

CCCS is a non-profit, full-service credit counseling agency, providing confidential financial guidance, financial education, counseling and credit repayment assistance to consumers since 1965.  CCCS of Buffalo helps consumers trim expenses, develop a spending plan and repay debts.  Counseling is available at our Main Office in West Seneca, in one of our Satellite Offices, by telephone and via Internet.  Visit www.consumercreditbuffalo.org for more information.


COVID-19 Mortgage Relief Policies: Foreclosure and Forbearance

It has been a financial challenging year for many Americans, and with that a lot of effort has been expended trying to keep people in their homes by halting foreclosures and evictions. This is the latest update regarding COVID-19 mortgage relief:

·        If your home was in foreclosure prior to the onset of the COVID-19 pandemic, there has been a moratorium that keeps the foreclosure process from continuing. Currently there is a foreclosure moratorium on federally guaranteed mortgages through June 30, 2021 meaning homeowners are protected from the initiation or continuation of foreclosure proceedings. These mortgages make up about two-thirds of resident mortgage loans across the nation.

·        If the house you are living in foreclosed before the Pandemic and became a Bank owned property (REO), you cannot be evicted until after June 30, 2021.

·        The mortgage payment forbearance enrollment window was also extended through June 30, 2021. Payment forbearance allows homeowners to pause or reduce their mortgage payments for a certain period of time. Borrowers who enter into forbearance on or before June 30, 2021 will receive up to six months of mortgage payment forbearance.

·        For mortgages backed by Fannie Mae and Freddie Mac; you may be eligible for an additional three months of forbearance. This could allow up to 18 months of forbearance time in total. To qualify for the extension, you must have been in a forbearance as of February 28, 2021. Other limits may apply. The COVID-19 Payment Deferral allows borrowers to repay the missed payments at the time the house is sold, refinanced, or the when the loan matures.

 What to do if you are having difficulty managing your mortgage?  

Continue to communicate with your lender and check your Lender/Servicer’s website for updates and information. Most sites contain content explaining options if you are struggling with mortgage payments at this time. If you still have questions or concerns, Schedule a counseling session with CCCS of Buffalo or your local HUD-Certified Housing Counselor to help you navigate during this difficult time. 

For up-to-date information visit: https://www.consumerfinance.gov/coronavirus/mortgage-and-housing-assistance/

Student Loans: Their Current State & What to do Next

Student Loans: Their Current State & What to do Next

At the onset of the pandemic, in anticipation of economic challenges and concerns looming for nearly 43 million loan borrowers, student loan assistance came when legislation passed within the CARES Act, providing a student loan payment pause and interest waiver through September 30, 2020 on federal education loans held by the U.S Department of Education. Fast forward over one year, three extensions later, and federal student loans are at a standstill. We want to recap the current relief that is available on student loans, as well share some strategies you can take now, and going forward as the relief expires.

Current Relief Available:

  • Interest and monthly payments on federally held loans are suspended through September 30, 2021.
  • You do not need to contact your student loan servicer or take any action on your federally held student loans.
  • Make sure your servicer has up-to-date contact information and check your mail or email so you can receive any updates or information about your loans.
  • Suspended payments through September 30, 2021 will count towards any student loan forgiveness program, as long as all other requirements of the loan forgiveness program are met.
  • The Department of Education has stopped the collection of defaulted federal student loans.
  • Private student loans are not covered by the COVID-19 emergency relief assistance

What strategies can you take at this time?

·         During this continued period of 0% interest until September 30, 2021, you can make payments which will be fully applied to the principal balance. If you are in the financial position to do so, this is encouraged, as it is always a good thing to pay down on 0% interest loan! (Albeit temporary)

·         If you are concerned about more pressing household expenses such as your mortgage, rent, insurances, medical, utilities and groceries; you may want to consider taking advantage of the student loan payment suspension to ensure that you are able to cover your basic needs during this time of uncertainty.

·         Another reason to take advantage of the student loan payment suspension is if you currently lack sufficient savings. Have some savings can be the catalyst in protecting you in the event of financial emergency, avoiding debt, as well as reducing your financial stress.

Preparing for Repayment to Resume:

·         When the payment suspension ends, you’ll receive your billing statement or other notice at least 21 days before your payment is due.

·         Check out the new tool, Loan Simulator on https://studentaid.gov/loan-simulator/ to find a repayment plan that meets your needs and goals, or to decide whether to consolidate your loans. Loan Simulator can help you estimate payments under a variety of repayment plans, including income-driven repayment (IDR) plans.

·         How can you find out how much your payments will be when payments restart? To find out what your payment amount will be, you will want to contact your loan servicer, as they are your official source for up-to-date information about your loan and repayment.

·         Are you concerned that your student loan payment will be too high when payments resume? You may be eligible to lower your monthly student loan payment by enrolling in an income-driven repayment plan. Under an IDR plan, payments may be as low as $0 per month.

 The best thing you can do at this time is review your student loans and ensure that you have a game plan for when the current student loan relief expires. Contact us for a Student Loan Counseling session if you need help managing your student loans! (716) 712-2060