Household debt in New York has reached record highs, owing to increasing mortgages, vehicle loans, and credit card balances. The Fair Debt Collection Practices Act protects New York residents from creditor harassment by prohibiting debt collectors from pursuing repayment of an expired obligation beyond the statute of limitations. Creditors lose the authority to sue or contact you for the debt once the statute of limitations has expired. This information is useful for consumers who are saddled with several previous debts. Today, we’ll walk you through the New York statute of limitations and how it affects your debt. To learn more, you can reach out to a New York collection attorney.
What about the statute of limitations?
According to the Consumer Credit Fairness Act of 2021 (N.Y. Civ. Prac. L. & R. 214-i), the statute of limitations for most types of debt in New York is lowered to three years as of April 7, 2022. This means that actions stemming from consumer credit transactions must be filed within three years if a purchaser, borrower, or debtor is a defendant, and subsequent payments or affirmations on the debt do not resuscitate or prolong the limitations period.
In New York, the statute of limitations for suing someone for a debt they owe is currently three years, beginning with the date of the last payment on the account. The Consumer Credit Fairness Act also mandated that defendants receive sufficient notice when they are being sued, that they have a 30-day response period to raise questions about the debt’s expiration, and that plaintiffs present relevant documentation. In New York, however, the statute of limitations for mortgage debt remains six years.
If the statute of limitations has run out, creditors must notify you, but you are not required to acknowledge the debt. Different types of debt have different deadlines, such as credit card and medical bills, which have a three-year limit, and mortgages, which have a six-year limit. However, there may be exceptions if the cause of action arose in another state with a different statute of limitations.
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You have rights against intimidation if a creditor initiates a lawsuit against you in New York after the statute of limitations on a debt has expired. You can report the creditor to the New York State Attorney General’s Office or the Federal Trade Commission. To defend oneself in court, file an Answer outlining your reasons for opposing the debt, such as that the statute of limitations has expired.