Statute of Limitations on Debt in New York: 3-Year Rule

New York household debt has hit record highs. Mortgages, auto loans, and credit cards drive this growth.

The Fair Debt Collection Practices Act protects you from creditor harassment. Debt collectors often pursue old debts after the statute of limitations expires. The statute of limitations sets a deadline for lawsuits and collection efforts.

After the statute expires, creditors cannot sue you. They cannot legally contact you about the debt. Understanding New York’s statute of limitations helps you fight back against time-barred debt.

Our partner Solo can help you respond to debt collection lawsuits in New York.

New York’s Statute of Limitations on Debt Is Three Years

The New York statute of limitations on debt is three years. Creditors have three years from your last payment to sue you.

Until 2022, the statute was six years. In January 2021, the New York Senate passed the Consumer Credit Fairness Act of 2021. The law reduced the statute to three years. The bill took effect on April 7, 2022.

N.Y. Civ. Prac. L. & R. §214-i states consumer credit transaction lawsuits must start within three years. After the limitations period expires, no payment or acknowledgment revives the debt.

The law requires several protections for defendants:

• Courts must mail official notice to defendants being sued
• You get 30 days to respond to the lawsuit
• You can explain the debt expired during this period
• Collectors must provide affidavits proving the debt and assignment chain

Mortgage Debt Has a Six-Year Statute

The New York statute of limitations on mortgage debt is six years. N.Y. Civ. Prac. L. & R. §213(4) covers actions on bonds, notes, and mortgages secured by real property.

Some creditors sue after the statute expires. You can use the expired statute as a legal defense. Courts cannot force you to pay time-barred debt.

Here’s how the statute works in practice:

An expired debt means creditors cannot sue you. But they can still contact you about it. You may receive calls or emails until you take action.

Send a Debt Validation Letter to stop collectors. The letter forces them to validate the debt. If they cannot, they must stop collection efforts.

Debt validation stops many creditors and collectors in their tracks. Many give up once you request validation.

Key Facts About New York’s Statute of Limitations

Creditors must know whether the statute has expired. If the statute of limitations has run out, creditors must:

• Inform you the statute has expired
• Tell you that you don’t have to acknowledge the debt
• Provide proof of prior settlement if you paid
• Warn you the statute may restart if you acknowledge or pay

Creditors rarely inform you of these requirements. They want their money back. Many consumers mistakenly acknowledge the debt or make a payment. These actions restart the clock on the statute.

Statute of Limitations for Different Debt Types in NY

The debt type affects the statute of limitations. Here are the deadlines for common debts in New York:

Statute of Limitations by Debt Type

Sometimes New York’s statute doesn’t apply to debt lawsuits. If the debt originated in another state, that state’s statute applies instead.

Use the Expired Statute as a Legal Defense

New York laws protect you from creditor intimidation. If the statute has expired, you can file a complaint. Report creditors to the Office of the New York State Attorney General or the Federal Trade Commission.

Here’s what to do if creditors sue after the statute expires.

Filing an Answer is your first step to winning. An Answer tells the court your defenses. You explain why the creditor shouldn’t win. A common defense is the expired statute of limitations.

Filing an Answer preserves your rights in the lawsuit. You avoid a default judgment. You can file in person at the courthouse. You can mail it to the court clerk. Some courts allow electronic filing.

Our partner Solo can file your Answer in all 50 states.

New York has strict deadlines to respond. The New York law sets these deadlines:

• 10 days if served in person in a city court outside NYC
• 20 days if served in person in all other courts
• 30 days if served by mail, left with someone at your home, or left on your door

Defend Yourself Against Time-Barred Debt

After confirming the debt is time-barred, don’t acknowledge it. Don’t agree to pay any amount. The statute begins when the cause of action arises. Partial payment might restart the statute for the creditor.

Don’t engage creditors directly. File an Answer stating the debt has passed the statute of limitations. The court will dismiss the case once they confirm the timeline.

For debts that haven’t expired, you have other options. You can negotiate a settlement. You can set up a payment plan. Our partner Cambridge Credit Counseling can help you create a debt management plan.

What Happens If You Ignore a Lawsuit

Ignoring a lawsuit guarantees you lose. The court issues a default judgment against you. The creditor can then garnish your wages. They can freeze your bank account. They can place liens on your property.

You must respond even if the debt is time-barred. Your Answer is your defense. Without it, the court sides with the creditor automatically.

How Solo Helps You Respond to Debt Collectors

Solo makes it easy to resolve debt with collectors. You can respond to lawsuits and send validation letters. You can even settle debts for less.

Solo’s Answer service guides you step-by-step. It asks the necessary questions to complete your Answer. An attorney reviews your document. Solo files it for you with the court.

Solo’s settlement service helps you negotiate with collectors. You can settle your debt for less than you owe. The entire process happens online. No phone calls with aggressive collectors.

No matter where you are in the debt collection process, Solo helps you resolve it.