New York Significantly Changes Debt Collection Lawsuits

New York recently enacted Senate Bill (SB) 153, the Consumer Credit Fairness Act, significantly impacting debt collection lawsuits filed by creditors or debt collectors.  A few of the key amendments include:

• Most collection lawsuits arising out of a consumer credit transaction will now have a 3-year statute of limitations rather than 6 years.
• Extensions and revivals of statutes of limitations based on subsequent payment, written or oral affirmation, and other activity on the debt will now be prohibited.
• A specified “additional notice of lawsuit” must be filed by the plaintiff for the court to mail to the consumer when a collection against a consumer arising out of a consumer credit transaction is filed.
• Third party debt collectors must submit supporting affidavits from the original creditor and any prior assignors, with a witness to verify the debt’s chain of title.
• Complaints must include the name of the original creditor, the date and amount of last payment and the last four digits of the account number.

SB 153 goes into effect on May 7, 2022, other than the exception of the prohibition on revival or extension of statute of limitations, which goes into effect on April 7, 2022.