7 On Your Side: Zombie debts aren't easy to get rid of

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7 On Your Side takes a look at a number of those subscriptions that bill you automatically and are really difficult to get rid of. (KGO-TV)

How many subscriptions do you have tied to your credit card? One or two? A re you sure? 7 On Your Side looks at a horror story of zombie contracts.

Just like in the movies, these are zombies -- credit card debits that just won't die.

Robert Wong signed up for a gym and associated services and wanted to stop, but the payments kept coming out of his credit card account.

"A lady answers my phone [call] and I told her my purpose. She said, 'Nobody can answer your phone [call], however I can take your name and phone number down. Somebody will call you later.' They never did," Wong said.

Wong sent two registered letters to the company to cancel the payments, but the money kept coming out of his account until 7 On Your Side started asking questions.

"By far gyms are the hardest," Thomas Smyth, CEO of Trim, said.
Trim is a service that scours your credit card statements looking for subscriptions and cancels the ones you don't want.

"We actually send certified mail on behalf of folks who want to cancel their gyms, if you can believe it. And the gym will not cancel with a phone call, with email... you actually have to send them a letter," Smyth said.

Susie Fu is from San Francisco and used Trim. It saved her a small fortune.

Fu: "Everything is times 12 if you're thinking about it from the annual spend perspective."
Finney: "How much were you spending?"
Fu: "It is embarrassing to say, but from gym memberships to clothing subscriptions, jewelry... all sorts of lifestyle subscriptions, I was probably spending anywhere from $100-200 a month."

Consumer Action's Joe Ridout has a name for these types of subscriptions - zombie contracts.

Ridout explained, "It makes it more convenient, but it also results in consumers having these zombie contracts they have forgotten completely about and wind up paying for month after month, or year after year, for a service they're not even using."

Ridout says it should be against the law for trial subscriptions to morph into automatic payments.

And back at Trim, Smyth says it's a moral issue. He said, "What is fair is for consumers to be able to cancel a subscription just as easily as they can sign up for one."
If you want, Trim will go through your credit card accounts, find zombies and then cancel them -- all for free. Click here to find out more.
Related Topics:
finance7 On Your Sidepersonal financemoneysave moneycredit cardsgymbillsconsumerconsumer concernsSan FranciscoPalo AltoOaklandNovatoSan Mateo
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