Jim, A Company That I Owe Money To Has Gone Out Of Business. Do I Still Owe The Money?

The answer is yes, but the real question to be asked is what organization do you owe the money to now?

It is not uncommon for mortgage companies, credit card issuers, and various other lenders to close their doors.  When they cease operations, what do you do and what happens to your debt?  Legally, the debt is an asset of the defunct corporation and will survive.  Think of it like this; if you were to die would bonds or stocks that you owned no longer be collectible by your heirs?  Certainly they would.  In the same manner, a defunct creditor’s assets are sold to pay their final expenses. 

You should be hearing shortly from the organization that has purchased your debt.  I would not stop sending payments as this may end up damaging your credit in the process.  As long as you have not been notified to send your payment to a new address, I would keep sending them as normal.  Of course, with a company going out of business there is a higher chance than ever that they may not be keeping accurate records.  For this reason, you should be sure to keep copies of your checks to be able to prove you have been making your payments (something you should always do anyway).

On the subject of what to do if your mortgage company goes under, here is an interesting article  What To Do If Your Mortgage Company Goes Bankrupt

Agree or disagree, click on comments below.

My main website is www.ChristianMoney.com

James L. Paris