Start My Answer
loading...

Debt Collection Laws in New York

Patrick Austin, J.D. | September 13, 2023

Patrick Austin
Attorney from George Mason
Patrick Austin, JD

Patrick Austin is a licensed attorney with a background in data privacy and information security law. Patrick received his law degree at George Mason University's Antonin Scalia Law School, where he served as the Editor-in-Chief for the National Security Law Journal.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: New York residents not only have legal protections under the federal Fair Debt Collection Practices Act, but the state-based Consumer Credit Fairness Act (CCFA). The CCFA strengthens the consumer protections of other laws and regulations governing debt collection practices and how debt collectors engage with consumers.

New York residents being hounded by debt collectors can seek refuge in an array of state and federal laws intended to protect consumers from being subjected to unfair, abusive, and deceptive debt collection practices.

Sued for debt? Resolve it through debt settlement.

Settle with SoloSettle

Make an Offer

Consumer Credit Fairness Act explained

In 2014, the New York State Assembly made significant modifications to the state’s debt collection regulations, notably with the passage of the Consumer Credit Fairness Act (CCFA). The CCFA is a state law enacted to strengthen the protections and rights afforded to consumers when dealing with overly-aggressive debt collectors.

The CCFA features a consumer-centric notice requirement that both original creditors and third party debt collectors must comply with when contacting New York consumers. The CCFA notice requirement includes:

  • The notice must be bilingual (e.g., in both English and Spanish);
  • The notice must include a statement about filing an answer as soon as possible;
  • The notice provide hyperlinks to the New York Law Help and/or NYCourts.gov; and
  • The notice must include a statement explaining the ramifications of not filing a response to the debt collection lawsuit.

The CCFA significantly impacts the statute of limitations on debt in New York

One of the most significant statutory modifications included in the CCFA is the change to the statute of limitations applicable to debt. For context, the statute of limitations establishes a legal time limit for a debt collector, or creditor, to pursue reimbursement of the unpaid debt via a lawsuit. If the statute of limitations expires and a creditor or debt collector sues you, it is possible to get the lawsuit dismissed on the grounds that the debt collection lawsuit is “time-barred.”

The CCFA reduced the statute of limitations from six years to three years for debt. This means more consumers will be able to raise the statute of limitations as an affirmative defense in debt collection lawsuits.

The table below further outlines the statute of limitations on different types of debt in New York:

Statute of Limitations on Debt in New York
Debt Type Deadline
Credit card 3 years
Medical 3 years
Student loan 3 year
Auto loan 3 years
Personal loan 3 years
Mortgage 6 years
Judgment 20 years
Source: N.Y. C.P.L.R. § 211, § 213, and § 214-I

Another significant change contained within the CCFA is formally addressing the issue of creditors and debt collectors effectively misleading consumers into restarting the statute of limitations through a partial payment or simply by acknowledging the existence of the debt. The CCFA tackles this issue by declaring that neither creditors nor debt collectors are allowed to restart the statute of limitations on a debt when a consumer agrees to make a payment.

Key Provisions and Regulations in New York's Debt Collection Practices Act

In addition to the CCFA, there is the Debt Collection Practices Act (DCL) in New York, which provides specific provisions and regulations that govern debt collection practices within the state. Here are some important provisions outlined in the DCL:

Harassment and Abuse

The DCL prohibits debt collectors from engaging in any form of harassment, oppression, or abuse when attempting to collect a debt. This includes using threats, obscenities, or any other offensive language, as well as making repeated or continuous phone calls with the intent to annoy or harass the debtor.

False or Misleading Representations

Debt collectors are prohibited from making false or misleading representations when communicating with debtors. This includes falsely claiming to be attorneys, misrepresenting the amount or legal status of the debt, or providing false information about the consequences of non-payment. Debt collectors are also barred from using deceptive practices such as falsely implying affiliation with a government agency or misrepresenting the character, extent, or amount of the debt.

Required Disclosures

The DCL requires debt collectors to provide certain disclosures to debtors during the debt collection process. These disclosures include informing debtors of their right to dispute the debt and request verification, stating that any information obtained will be used for the purpose of debt collection, and providing clear and accurate information about the debt, including the amount owed and the creditor's contact information.

Prohibition of Unfair Practices

The DCL prohibits debt collectors from engaging in any unfair practices that can cause harm, deception, or substantial inconvenience to debtors. This includes publishing or threatening to publish a debtor's name or personal information in connection with the debt, contacting debtors at unusual or inconvenient times, misrepresenting the legal status of the debt, or attempting to collect debts that are not owed.

You have rights as a debtor in New York

As a debtor in New York, it is crucial to understand your rights in order to protect yourself from unlawful debt collection practices. The New York Debt Collection Practices Act (DCL) provides specific provisions that outline your rights as a debtor. Here are specific legal rights that you should be aware of:

  • Right to Validation of Debt: Under the aforementioned DCL, you have the right to request validation of the debt from the debt collector. This means that you can ask the debt collector to provide proof that you owe the debt and that they have the right to collect it. The debt collector must provide this validation within five days of your request.

  • Right to Dispute the Debt: If you believe that the debt is not valid or that the amount is incorrect, you have the right to dispute the debt. You can send a written dispute letter to the debt collector, stating your reasons for disputing the debt and requesting that they stop collection activities until the matter is resolved. The debt collector is then required to investigate the dispute and provide you with a response.

  • Right to Cease and Desist Communications: If you do not wish to be contacted by the debt collector, you have the right to request that they cease and desist all communications with you. You can send a written cease and desist letter, asking the debt collector to stop contacting you in any form. After receiving this letter, the debt collector must comply with your request, except to inform you of any legal actions they may take.

  • Right to Protection from Harassment: The DCL prohibits debt collectors from engaging in any form of harassment, oppression, or abuse when attempting to collect a debt. This includes using threats, obscenities, or any other offensive language, as well as making repeated or continuous phone calls with the intent to annoy or harass you. If you believe that a debt collector is harassing you, it is important to document the incidents and report them to the appropriate authorities.

  • Right to Legal Action: If your rights under the DCL have been violated, you have the right to take legal action against the debt collector. You can file a complaint with the New York State Department of Financial Services or consult with an attorney who specializes in debt collection practices. Taking legal action can help you seek compensation for any damages you have suffered as a result of the debt collector's unlawful actions.

Now that we’ve discussed notable state laws impacting debt collection, let’s discuss federal regulations.

Fair Debt Collection Practices Act

On the federal level, consumers are afforded legal rights and protections under the Fair Debt Collection Practices Act (FDCPA), which is a federal law governing the practices of debt collectors, including those in New York. The FDCPA prohibits debt collectors from engaging in abusive, deceptive, or unfair practices when attempting to collect a debt. This includes actions such as harassment, false statements, or threats.

Key Takeaways

  • Residents of New York are afforded legal rights and protections under city, state, and federal law when it comes to engaging with debt collectors.
  • The CCFA and DCL are state laws that provide enhanced protections to NY residents.
  • The CCFA impacts the statute of limitations applicable to debts of New York residents.
  • If you are sued by a debt collector in New York, it is particularly important to respond to the complaint and consider raising an affirmative defense, or defenses to the allegations in the complaint.
  • If you have evidence that a debt collector violated the FDCPA, consider taking legal action to pursue both monetary compensation and injunctive relief in a court of law.

Settle your debt in New York

Debt collectors and creditors have the right to take legal action if you refuse to communicate with them about your debt. However, that doesn’t mean that all debt lawsuits have merit. Luckily, SoloSuit was created with this in mind.

SoloSuit can help you respond to a debt lawsuit in New York, stand up for your rights, and buy yourself time to work out a debt settlement plan. The surest way to get debt collectors off your back is by paying what you owe. And if you go about this wisely, you can usually settle your debt for less than you originally owed.

In a debt settlement, you offer your creditor a portion of the total amount due, usually at least 60% of the debt’s value. In exchange for a lump-sum payment, the creditor agrees to drop its legal claims against you and release you from the remaining balance.

If you decide to settle your obligation, you’ll want to ensure you get the terms of your agreement in writing and pay the creditor before your court date. If you’ve never tried debt settlement before, consider working with a professional organization that will guide you through the process.

To learn more about how to settle a debt in New York, check out this video:

SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with the collector. Once an agreement is reached, we’ll help you manage the settlement documentation and transfer your payment to the creditor or debt collector, helping you keep your financial information private and secure.

Read also: How to Settle a Debt in New York

What is Solo?

Solo makes it easy to resolve debt with debt collectors.

You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt. SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

SoloSettle can help you contact your debt collector or creditor and negotiate the debt to settle for less, all online. It simplifies and streamlines the process to settling your debt.

No matter where you find yourself in the debt collection process, Solo is here to help you resolve your debt.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)

How to Answer a Summons for debt collection in all 50 states

Here's a list of guides on how to respond to a debt collection lawsuit in each state:

The Ultimate 50 State Guide

Debt collector guides

Are you being contacted by a debt collector? We’re making guides on how to resolve debt with each one.

Arbitration

If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.

Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.

Bankruptcy

Bankruptcy is a great way to legally resolve debt, but it's usually best to consider it as a last resort. Here are some bankruptcy guides to help you decide which debt resolution option is best for you.

Check your case status

Don’t have time to go to your local courthouse to check the status of your case? We’ve created state guides on how to check the status of your case throughout the US, complete with online search tools and court directories.

Credit

Debt has a big impact on your credit. Below is a list of guides on how to repair and improve your credit, even while managing major debt, along with other credit-related resources.

Debt collection FAQs

Find answers to some of our the most commonly-asked questions about debt collection below.

Debt collection documents and templates

If you're dealing with debt, these documents and templates will help you respond, protect your rights, negotiate, and resolve your debts.

Debt relief

We’ve created a specialized guide on how to find debt relief in all 50 states, complete with steps to take to find relief, state-specific resources, and more.

Debt settlement

Debt settlement is one of the most effective ways to resolve a debt and save money. We’ve created state guides on debt settlement. Find out how to settle in your state with a simple click and explore other debt settlement resources below.

Eviction

Facing an eviction? The following guides will help you navigate your situation with confidence.

Federal debt collection laws

Knowing your rights makes it easier to stand up for your rights. Below, we’ve compiled all our articles on federal debt collection laws that protect you from unfair practices.

Legal aid

Helping people find access to justice is at the heart of Solo's misison. If you're dealing with a legal debt issue, the following guides will help you through it.

Medical debt

Having a health challenge is stressful, but dealing with medical debt on top of it is overwhelming. Here are some resources on how to manage medical debt.

Personal finance

Learn how to manage your finances and overcome crushing debt. Check out our personal finance guides below.

State debt collection laws

Debt collection laws vary by state, so we have compiled a guide to each state’s debt collection laws to make it easier for you to stand up for your rights—no matter where you live.

Statute of limitations on debt

Like all debt collection laws, the statute of limitations on debt varies by state. So, we wrote guides on each state’s statutes and more.

Stop collection calls

Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.

Wage garnishment

Forgot to respond to your debt lawsuit? The judge may have ordered a default judgment against you, and with a default judgment, debt collectors can garnish your wages. Here are our guides on how to stop wage garnishment in your state, plus other wage garnishment resources.

The Debt Hotline

Hosted by Team Solo, The Debt Hotline breaks down debt and personal finance topics with help from attorneys, financial experts, and industry pros. We respond to real questions to help you navigate debt with knowledge and courage.

Other debt resources


It only takes 15 minutes.

And 50% of our customers' cases have been dismissed in the past.


"Finding yourself on the wrong side of the law unexpectedly is kinda scary. I started researching on YouTube and found SoloSuit's channel. The videos were so helpful, easy to understand and encouraging. When I reached out to SoloSuit they were on it. Very professional, impeccably prompt. Thanks for the service!" - Heather



Get Started

Contents