New York governor Andrew Quomo recently announced New York's new debt
collection regulations. The regulations, issued under a provision of the
New York Financial Services law, seek to provide consumers with additional
protections that they did not previously have. The new regulations take
effect March 3, 2015.
The new regulations require:
1. Improved disclosures. Under the new regulations, debt collectors must provide the amount of
the debt owed when it was "charged off" by the original creditor.
Collectors must also itemize interest and fees accrued after the charge off date.
2. Time-barred debts. The new regulations require debt collectors to inform consumers if a debt
is past the applicable statute of limitations. They must also inform the
consumer that the time-barred nature of the debt would be a defense to
being sued on the debt. The hope is that, when consumers know their rights,
they will be more likely to defend debt collection cases.
3. Substantiation of debt. The FDCPA provides a process for verifying a debt, but it is limited to
a 30 day period. The new regulations allow consumers to request substantiation
of the debt at any time during the collections process--a major change
when compared to the FDCPA. Once a consumer makes such a request, the
regulations require the collections to stop and the collector must provide
the requested information within 60 days.
4. Written confirmations. When consumers enter into a settlement agreement, it must now be confirmed
in writing. Also, when consumers pay off a debt obligation, it must be
confirmed in writing.
5. Email. Consumers now have the option of communicating with collectors via email.
This will allow them to avoid harassing phone calls.
Hopefully more states will follow suit and expand on the protections already
provided under the FDCPA.
The full text of the new regulations is