urban legend

noun
1.
a modern story of obscure origin and with little or no supporting evidence that spreads spontaneously in varying forms and often has elements of humor, moralizing, or horror:
Are there alligators living in the New York City sewer system, or is that just an urban legend?
Also called urban myth.
Origin
1970-75
British Dictionary definitions for urban myth

urban myth

noun
1.
a story, esp one with a shocking or amusing ending, related as having actually happened, usu. to someone vaguely connected with the teller
Contemporary definitions for urban myth
noun

a folkloric and often sensational tale about modern life that is repeated in the media and by other means, making it more believable to some; also called urban legend

Word Origin

from the book book The Vanishing Hitchhiker: American Urban Legends & Their Meanings