When a debt buyer files a lawsuit against you, they pray for a court order for you to pay an old debt. Debt buyers are companies that buy charged-off consumer debt from original creditors. They buy these for almost nothing and then sue debtors to get the money back. However, a lawsuit is not an automatic win. You have legitimate legal defenses against debt buyer lawsuits if you raise them properly in your Reply or Answer.
In Arizona, you must respond to a lawsuit within a strict deadline. The reglementary period is 20 calendar days after you were served with the summons and complaint. If you ignore this, the court may enter a default judgment against you, allowing the collector to start garnishing your wages or bank accounts. Therefore, you must act quickly to prevent them from doing so. Here are some defenses that you can use in your case:
Statute of Limitations (Time-Barred Debt)
One of the most powerful defenses in Arizona is the statute of limitations.
According to Arizona Revised Statutes § 12-548(A), most written debt contracts (like credit cards, medical bills, personal loans) must be sued within six years after the debt became enforceable in court. If the creditor waits longer than six years, the case has prescribed and the court must dismiss the lawsuit. For open or oral accounts, the limit is three years (A.R.S. § 12-543).
For example, you stopped paying a credit card in January 2017 and never made a full payment after that date. If a debt buyer files a lawsuit in January 2025, that lawsuit could be dismissed due to prescription.
However, under Arizona law, only full payments reset the clock, and not partial or small payments. Note that the exact timing can depend on specific contracts. If the debt is older than six years and you raise prescription as defense, the court may likely dismiss the case.
Lack of Standing / Chain of Ownership
Debt buyers must prove they have the legal right to sue you as the new owner of the debt. This is called legal standing. They must show a clear chain of assignments from the original creditor to the current plaintiff. If the paperwork is incomplete or doesn’t specifically show that they own your debt, you can raise that they lack of standing and pray to the Court that the case be dismissed due to lack of merit.
In some Arizona cases, courts have thrown out debt buyer lawsuits because the debt buyer couldn’t prove a valid assignment from the original creditor.
For example, the debt buyer files a lawsuit claiming it owns your XYZ Bank credit card account. You then request production of the assignment documents. However, the only document they produce is a general assignment with thousands of accounts. It does not mention your specific account numbers. Further, it was not properly signed or notarized. Hence, you may argue in court that they do not own your account, so the lawsuit should be dismissed.
This defense is especially useful when debts have been resold many times, which is common in the debt-buyer business.
Improper or Insufficient Documentation
Even if the debt buyer technically bought the debt, they still must prove the debt exists and how much you owe. Many debt buyers rely on old, incomplete records.
You can challenge:
- Whether the documents truly belong to you,
- Whether they accurately reflect your payment history,
- Whether the contract itself was properly signed.
This often involves evidentiary objections. Basically, it tells the court that the documents are not admissible or don’t actually prove what they claim. For example, the only evidence they bring is a printout with no signatures, a cardholder agreement, or an original contract. You may argue that the court should not consider that evidence.
Identity Theft or Mistaken Identity
Sometimes debt buyers sue the wrong person. This happens when accounts are mixed up; maybe someone else’s debt uses a similar name, or some clerical error occurred.
If you truly never incurred the debt and it resulted from identity theft or a clerical error:
- You can raise a defense stating the debt is not yours;
- Provide clear and convincing evidence like police reports (in identity theft cases);
- Show proof of your identity or proof that you never had an account.
This defense puts the burden on the debt buyer to prove you really owe the debt.
You Already Paid the Debt or Bankruptcy Discharge
If you already paid the debt, or if the debt was discharged in a bankruptcy case, the debt buyer cannot legally collect it anymore.
For example, your debt was included and discharged in a Chapter 7 bankruptcy. Thus, any attempt to collect or sue on that debt is prohibited by federal law, and you can raise that defense in your Answer.
Likewise, if you have documentation showing the debt was fully paid, and the debt buyer still sues, you can raise that as a defense.
Violations of the Fair Debt Collection Practices Act (FDCPA)
Arizona debt buyers also must follow federal law: the Fair Debt Collection Practices Act (FDCPA). The FDCPA prohibits deceptive, unfair, or abusive practices in consumer debt collection.
Examples:
- Suing against time-barred debt
- Misrepresenting ownership
- Inflated balances
In Arizona debt buyer lawsuits, if the debt buyer violated the FDCPA, you may have both:
- A defense in your debt case, and
- A separate federal claim for damages (e.g., attorney’s fees or statutory damages) against the debt buyer.
Note: FDCPA violations must be proven in the right forum, in a federal or state court. The unfair or abusive practices of debt collectors can strengthen your defense.
Improper Service of the Lawsuit
If the debt buyer didn’t properly serve you, the court may not have personal jurisdiction over you. Service must follow specific procedures, and mistakes here can give you a defense.
Common issues:
- Service at an old address
- Service on someone not authorized
- Mail service without proper follow-up
Improper or late service can delay the lawsuit or even force the plaintiff to start over.
Do not ignore debt buyer lawsuits. Failing to answer the lawsuit generally results in a default judgment against you, even if the lawsuit should never have been filed in the first place.
State your defenses in your Answer to the claim, such as the statute of limitations, lack of standing, identity issues, or improper documentation. If you delay or fail to raise a defense in a timely manner, the court may consider the defense waived.