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How to Get Debt Relief in New York

George Simons | August 24, 2023

George Simons
Co-Founder of SoloSuit
George Simons, JD/MBA

George Simons is the co-founder and CEO of SoloSuit. He has helped Americans protect over $1 billion from predatory debt lawsuits. George graduated from BYU Law school in 2020 with a JD-MBA. In his spare time, George likes to cook, because he likes to eat.

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 state programs can help you find relief from debt. There are also effective strategies, like the snowball and avalanche methods, to help you manage and pay off your debts. Knowing your legal rights when it comes to debt is one of the most effective ways to battle it, and SoloSuit is here to show you these rights and help you resolve your debt in any state.

The Coronavirus pandemic hit New Yorkers especially hard since it basically decimated some key sectors of the Big Apple's economy (e.g., finance, real estate, tourism, etc.). This is largely why millions of people in New York continue to struggle with financial challenges. For example, the average New York resident is carrying more than $5,400 in credit card debt (the 14th-most in the entire country). In addition to credit card debt, the average New York resident is carrying an average mortgage debt of $240,795, which ranks as the 10th-largest amount in the United States.

If you live in the New York area and are encountering difficulties making timely debt service payments (e.g., credit card payments, student loan payments, auto loan payments, etc.), then you should research strategies on how to get debt relief in New York.

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See if you qualify for the New York debt relief programs

New Yorkers struggling with debt may qualify for financial assistance through a variety of federal and/or state programs. As a New York resident, check out these New York debt relief programs to see if you qualify:

  • Supplemental Nutrition Assistance Program (SNAP): This service offers financial benefits that can be utilized to purchase groceries. Though, SNAP is generally only available to low-income working New York residents, senior citizens, and people with recognized disabilities. Qualifying for SNAP is usually assessed based on your income, household size, and other key factors.
  • Family Assistance (FA): Operated under Temporary Assistance for Needy Families (TANF), this program offers cash assistance to eligible individuals for up to 60 months.
  • Safety Net Assistance (SNA): Also run by TANF, this program is available for single adults, childless married couples, children living apart from relatives, individuals struggling with drug addictions, and aliens who are ineligible for federal reimbursement. If you qualify, the TANF program provides financial benefits for up to two years.
  • Home Energy Assistance Program (HEAP): Offers assistance to low-income New York residents in covering utility expenses (e.g., heating and cooling bills, water bills, electric bills, etc.).
  • Low Income Household Water Assistance Program (LIHWAP): Helps low income households pay the cost of water and sewer services. The program can assist households who have past due bills (arrears) for water and/or sewer services.
  • New York State Supplement Program (SSP): Provides state-funded financial assistance to aged, blind and disabled individuals and is part of the monthly benefit paid to most Supplemental Security Income (SSI) recipients.
  • Private Student Loan Relief: Provides a network of financial counselors who link troubled families with trustworthy agencies for financial assistance with private student loans.

Pay Off Your Debt Using the “Snowball” Strategy

With the debt snowball strategy, you pay your smallest debt first and continue to make minimum payments on other debts to ensure you do not go into default. After you pay off the smallest balance, you then take that payment and roll it into the amount being applied toward your next balance. Once that balance is paid, you roll both payment amounts to the next highest balance and so on.

Pay Off Your Debt Using the “Avalanche” Strategy

With the debt avalanche strategy, you begin by paying off the balance with the highest interest rate while continuing to pay the minimum payments on all of your other debts. When that balance is paid, you redirect that same payment towards another balance with the second highest interest rate, and so on.

Apply for a debt consolidation loan

In addition to the debt paydown methods described above, you may want to consider applying for a debt consolidation loan. This can be an effective strategy for managing and paying down your debt load. Why should you consider a consolidation loan? Well, this type of loan affords you the opportunity to combine your debt from different creditors so you only have to worry about making one payment toward one loan. For many people, this is preferred over paying multiple creditors each charging separate fees and interest rates on revolving balances.

In addition to simplifying your monthly debt payments, a consolidation loan could save you money on interest and fees. For example, if you are carrying balances on multiple high-interest credit cards charging anywhere between 18%-25% you may be able to get a loan at a much lower interest rate (ranging between 10%-15%). If you can lock in a reduced interest rate, it can result in significant savings in the amount you shell out to service the debt and a lower monthly payment.

Consider the pros and cons of debt management programs

If you need assistance implementing one or more of the debt relief strategies listed above, it may make sense to consider a debt management program administered by a professional nonprofit credit counseling company.

Debt management programs can be extremely effective, but they're not for everyone. For example, someone who was fairly adept at managing their finances, but suddenly got saddled with thousands of dollars in medical debt, may not need a debt management program. However, you may want to choose a debt management program if:

  • You are struggling to manage a significant amount of credit card debt
  • Your credit score does not qualify you for a balance transfer credit card
  • Your credit score does not qualify you for a personal loan
  • You are looking for a clear, detailed plan to help you avoid accruing more debt in the future

New York debt collection laws may protect you

As a New Yorkers, it's important for you to know the state's debt collection laws so you can be aware of your rights and better protect yourself from unfair debt collection practices. Along with the Federal Debt Collection Practices Act (FDCPA), New York has debt collection laws in place to stop abusive debt collectors in their tracks.

One of the most important New York debt collections laws is the statute of limitations on debt. This is the time period that a debt collector has to take someone to court over a debt they supposedly owe. Here are New York's statutes of limitations on different types of debts:

Statute of Limitations on Debt in New York

Debt Type Deadline
Credit card 3 years
Medical 3 years
Oral contract 3 year
Written contract 3 years
Mortgage 6 years
Judgment 20 years

In other words, if you haven't taken responsibility for a debt or made payments on it for over six years (20 years for judgments), debt collectors and creditors cannot sue you for that debt. If they try, you can bring this information before the court and get your case dismissed.

Summary of how to get debt relief in New York

If you reside in New York and are struggling with a significant amount of debt (whether that be credit card debt, student loan debt, medical debt, etc.), don't give up.. There are options available to help you get the debt relief you need.. Those options may include:

  • Accessing specific New York debt relief programs and resources
  • Using the snowball or avalanche avalanche strategies to pay off your debt
  • Taking out a debt consolidation loan
  • Participating in a debt management program

No matter the option you choose, SoloSuit is here to help. And if you've been sued for a debt you owe, you can use SoloSuit's free Answer form to respond and win in court. Plus, The Debt Lawyer specializes in offering comprehensive wage garnishment and bankruptcy solutions for residents of New Jersey and New York with a team of seasoned team of legal professionals dedicated to providing personalized guidance every step of the way. Whether you're considering filing for bankruptcy or just seeking clarity about your financial situation, you have resources.

To learn more about how to respond to a debt lawsuit, check out this video:

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