With over 100 million Americans in significant debt, and more and more each day falling into the debtor’s paradise of expiring debt, which under the statute of limitations states that they are no longer obligated to repay it, banks are looking for ways to collect on these disappearing dollars. Debt collectors, it seems, have discovered a way. Using agreements forged between debt collectors and banks, collectors are issuing new credit cards, even to individuals with rock bottom credit scores, if they agree to pay back a portion of their defunct debt balance. It sounds like many people are taking advantage of this dubious deal, and may be getting themselves into a whole new debt mess.

Individuals that have expired debt, debt they are no longer legally obligated to pay, are being targeted by debt collectors that are handing out credit card offers. These individuals, usually with abysmal credit scores (they were in oodles of debt for a long time, afterall), can accept these offers and get a credit card once more. However, the cards come with high interest rates and monthly payments, moderate balances, and the provision that they “reactivate” a portion of their previous expired debt. However, once reactivated in this way, the old debt becomes new debt, and they must legally pay it back. In other words, the life of that debt is reset, and is probably even more expensive.

According to the Consumerist, one of these collections companies say that they recouped $15 million of expired debt dollars in this fashion in a single month. The Wall Street Journal pointed out that these kinds of credit arrangements have actually been around for decades, but were not popularized until the economic crunch of 2008 suddely brought millions of Americans credit to bare.

The only real losers in this scenario is the customers. The banks issue the cards with the debt collectors like a kind of cosigner. If the customer fails to repay the principle, the debt collector foots the bill to the bank (which protects the banks) and then is able to go after the customer with the full weight of the law (because of the newly reactivated debt). In addition, the debt collectors make huge profits on the reactivated debt, which they purchase for pennies on the dollar. The credit cards have sky-high interest rates, lower than average balances, and tons of fees, which all make it more difficult for customers to pay it off quickly, and if they’ve learned nothing from their previous debt woes, they’ll have a whole new opportunity to learn.