New York Governor Kathy Hochul signed into law The Consumer Credit Fairness Act. The Act addresses predatory debt collection practices.
The Act requires that court actions concerning a consumer credit transaction be commenced within three years. The Act mandates that complaints on the basis of a consumer credit transaction must include, among other informational components, an attachment of the contract or agreement underpinning the complaint.
In addition, the Act requires that in pending actions on the basis of a consumer credit transaction, a creditor's legal representation will provide additional notice to the consumer that details, among other things, (i) the ramifications of not responding to the pending action, and (ii) defense resources. The Act prevents creditors from receiving a default judgment for filing in the event that the notice is undeliverable. The Act further provides (i) additional consumer protection provisions regarding consumer waiver of defense for improper service and (ii) restrictions concerning the confirmation of an arbitration award and default judgments.
With the exception of the three-year statute of limitations provision, which goes into effect immediately, the bill goes into effect 180 days after its enactment.
Primary Sources
- NYDFS Press Release: Governor Hochul Signs Consumer Protection Legislative Package
- NYS S.153/A.2382: The Consumer Credit Fairness Act
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