NEW RULES ON DEFAULT JUDGMENTS IN CONSUMER DEBT

The new Consumer Credit Fairness Act (S.153/A.2382) is now fully in effect in New York.  The Consumer Credit Fairness Act (CCFA), which was signed by Gov. Kathy Hochul on November 8, 2021, strengthens consumer protections in debt collection proceedings.   One aspect of the law was made effective on May 6: when a third-party debt collector seeks a default judgment collecting upon a consumer debt, the application for default judgment must now include affidavits from 1) the original creditor; 2) any subsequent assignors or sellers of the debt; and 3) a witness who can verify the chain of title of the debt.  Additionally, all parties requesting the default judgment must also attach an affidavit stating the statute of limitations on collecting the debt has not expired.