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NY proposes new court rules for debt collectors

ALBANY, N.Y. (AP) -- New York's chief judge has proposed reforming consumer debt cases in state courts with new filing requirements for collectors of so-called "zombie" debts.

Judge Jonathan Lippman says many debtors discover they've been sued only when their bank accounts are frozen or their wages garnished.

While most have no lawyer, many are confused about old, often resold, debts. He says many never appear in court while others are never even served with notice of the lawsuits.

Lippman says more than 100,000 consumer credit suits are filed in state courts annually, most from third-party buyers of delinquent credit card debt that's often years old.

The rules starting June 15 would eliminate "robosigning," requiring detailed proof for default judgments and an affirmation time hasn't run out and the consumer was notified of the suit.
 
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