GRAND RAPIDS, Mich. (WOOD) — This isn’t the retirement Eli and Deb Yoder had envisioned.

“The last couple years, his health has just gone right down the tube,” Deb Yoder said. “He has always been so strong and a very, very hard worker.”

But at 72, Eli Yoder’s heart is failing. He’s now dependent on his wife of five decades, who also cares for her 90-year-old mom.

“And then, I get this in the mail,” Deb Yoder explained, motioning to some papers. “I started crying. I thought, ‘Oh my God, here we go again, another huge medical bill we weren’t expecting.’”

The Yoders, who rely on Social Security, already took out a second mortgage on their home in Hastings to cover Eli’s medical expenses. Then Deb Yoder found a sudden, new expense in the mailbox: a surprise bill for $2,995.

“We don’t have an extra $3,000,” she exclaimed.

“That’s a lot of money,” she continued. “I think I would know if I owed that.”


After seeking additional documentation from the Wisconsin-based collection firm, she figured out the bill’s origin.

“I recognized the doctor’s name and thought, ‘Oh, that’s when I had that surgery on my leg, from over five years ago,’” Deb Yoder recalled.

In March 2018, she underwent minor surgery to relieve severe foot pain. The surprise bill wasn’t for the operation itself — it was for a leg compression device the hospital sent home with her.

“I was dumbfounded,” Deb Yoder recalled. “I was just like, sucker-punched… Who pays attention to where their medical supplies come from when you’re in the hospital?”

She said she called her insurance company and was told the provider had denied payment to the Oklahoma medical device supplier, declaring it “out of network.”

“I couldn’t dispute (the denial) because I didn’t know about it,” she said. “So my time is up for fighting it… I was so upset. I couldn’t think straight. Why would they wait so long to notify me that I owe this money?”

The answer lay within the documents she received from the debt collector. In May, the Oklahoma medical device supplier sold its old debt in bulk, more than 27,000 accounts worth, to a debt purchasing company. Among the haul was Deb Yoder’s $2,995 bill.

It’s big business: the buying, selling and collecting of delinquent debt on the secondary market. When an original creditor gives up on collecting a debt, it can turn around and sell it to big companies, in bulk, for pennies on the dollar.

It’s sometimes referred to as “zombie debt,” and for good reason. The accounts, once considered dead, are resurrected by third-party collectors who go after borrowers again and, in many cases, take them to court.


It’s a debt collection system Target 8 first exposed in 2019. Since then, a commission launched by Michigan’s Supreme Court has declared the judiciary’s process for handling debt collection cases “outdated” and “inconsistent.”

In November 2022, the Justice for All Commission released a 75-page report revealing the system’s shortcomings and making recommendations for change.

According to the report, more than half of all unpaid debt lawsuits in Michigan were filed by “five large national companies that purchase credit card, medical, and utility debts for pennies on the dollar from original creditors.”

The report also revealed that consumers rarely have legal representation and that most cases, 68%, result in a “default judgment” or “automatic win” for the debt collector. In three of every four cases that reach judgment, courts order the seizure of the defendants’ “assets, wages, and even tax returns,” according to the commission’s research.

The third-party debt collector seeking payment from Deb Yoder has not filed suit against her — at least not yet.

“Is there a statute of limitations or anything on when they can collect on a bill?” she wondered.

There is.

Under Michigan law, if your debt is more than six years old, you no longer have to pay it. Consumer attorney Mike Nelson told Target 8 the statute of limitations is even less, four years, on debt accrued from the sale of goods. Nelson thinks Deb Yoder’s bill falls under the four-year statute.

“This looks to me like a sale of goods,” Nelson said from his office in Grand Rapids. “This company in Oklahoma didn’t perform any service (for Deb Yoder). They allegedly sold her a good, a medical device. So I think they’re a pretty good argument that this is all barred by the statute of limitations, which is four years.”

That’s good news for Deb Yoder, who unknowingly accrued her leg compression debt 5 and a half years ago.

“If she had a lawyer write to (the collecting agency) and say, ‘I think this is barred (by the statute of limitations),’ that may just solve this problem,” Nelson advised.

Deb Yoder plans to follow that advice.


Fortunately, she had not yet made a payment on the debt. Nelson cautioned that doing so, making even one payment, restarts the clock on the statute of limitations, meaning you’re on the hook for another four to six years.

That being said, he urged consumers not to ignore bills or lawsuits even if they don’t think they can pay.

“A lot of people don’t know how to respond, don’t think they can respond, can’t afford a lawyer,” Nelson explained. “And there’s no check (by the court) to see whether the claim is valid before there’s a default judgment.”

Nelson said consumers who do respond may learn the debt has expired or isn’t even theirs.

“(Consumers) should try to respond,” Nelson said. “Quite often, I see people who get sued for something that is not their debt at all because, a lot of times, these debt-buyers won’t have a whole lot of information about the debt that they bought. This happens quite a bit.”

If a consumer fails to respond to a debt collection suit or never received notice of it in the first place, the court can still enter a judgment in favor of the creditor and seize the consumer’s assets.

If you need legal help, but can’t afford it, there are some resources available. A program through the Grand Rapids Bar Association allows you to pay a $25 administrative fee upfront to schedule a 30-minute consultation with an attorney. The consultation itself is free.

Legal Aid of Western Michigan may also be a resource, though the agency is limited in what it can offer.

“Please note that Legal Aid of Western Michigan can, in limited circumstances, help low-income clients with consumer debt problems that threaten basic living needs like housing and having money for food,” Steve Grumm, the agency’s director of community engagement, wrote in an email exchange with Target 8.

Meanwhile, the Justice for all Commission is recommending multiple changes and Michigan’s Supreme Court is considering them.

“Half of all debt collection lawsuits in Michigan are brought against people living in low-income and majority Black neighborhoods,” the commission reported. “Of particular note, consumers in debt collection cases rarely have representation while creditors are almost always represented.”

Recommendations from The Justice for All Commission include modernizing process-serving rules to ensure consumers receive notice of litigation, creating court forms consumers can easily access and use, increasing the information debt collectors must include in filings to ensure there’s evidence to support default judgments and developing pilot projects to find alternatives to litigation.

A nonprofit trade organization that represents those who purchase, sell or collect debt requires its members to undergo a certification process and adhere to a code of ethics. Receivables Management Association International represents more than 600 companies that handle debt on the secondary market.

“RMAI really believes in the professional and ethical collection of legitimate debt,” spokesperson Jan Steiger said. “Our standards go beyond state and federal law and, specific to older debt, we prohibit the restarting of the statute of limitations. Once a debt is past the statute, it is always out of statute.”

Steiger went on to note that the world is based on a credit ecosystem and RMAI recognizes people — with the exception of scammers — do not go into debt intentionally.

“Something happens that prohibits them from doing something they intended to do in good faith,” Steiger explained, referring to people who fall behind on paying debt. “There’s a medical emergency. There’s a divorce. They’re in a situation where they need help. And our industry is well-poised to work with that consumer and help rehabilitate them financially to allow them to once again be an active participant in the credit world.”