senate Bill S195

Requires a principal creditor to send a notice of delinquency to the debtor and co-signer of an account

download pdf

Sponsor

Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
view actions

actions

  • 05 / Jan / 2011
    • REFERRED TO CONSUMER PROTECTION
  • 04 / Jan / 2012
    • REFERRED TO CONSUMER PROTECTION
  • 30 / Apr / 2012
    • 1ST REPORT CAL.612
  • 01 / May / 2012
    • 2ND REPORT CAL.
  • 02 / May / 2012
    • ADVANCED TO THIRD READING
  • 21 / Jun / 2012
    • COMMITTED TO RULES

Summary

Requires a principal creditor to send a notice of delinquency to the debtor and co-signer of an account.

do you support this bill?

Bill Details

See Assembly Version of this Bill:
A7616
Versions:
S195
Legislative Cycle:
2011-2012
Current Committee:
Senate Rules
Law Section:
General Business Law
Laws Affected:
Amd §600, add §601-a, Gen Bus L
Versions Introduced in 2009-2010 Legislative Cycle:
S2538

Votes

9
0
9
Aye
0
Nay
1
aye with reservations
0
absent
0
excused
0
abstained
show Consumer Protection committee vote details

Sponsor Memo

BILL NUMBER:S195

TITLE OF BILL:
An act
to amend the general business law, in relation to notice of delinquency
requirements

PURPOSE:
To require a principal creditor to send a notice of delinquency to the
debtor and co-signer of an account.

SUMMARY OF PROVISIONS:
Section 1 amends section GOO of the general business law by adding new
subdivision 4. Subdivision 4 (i) defines the term co-signer and their
role in relation to the debtor. Subdivision 4 (ii) states that in the
case of a consumer credit account becomes obligated under the
agreement as a co-signer with respect either to all purchases and
loans, or a specified maximum dollar amount of purchases and loans
that will be obtained from time to time pursuant to the agreement
whether or not it is contemplated that the co-signer may receive any
of the property, services or money to be obtained. This does not
include a seller, holder or lender who becomes obligated to an
assignee of such party's rights or a joint applicant for credit who
is intended to be primarily liable under the agreement.

Section 2 amends the general business law by adding new section 601-a
which obligates every principal creditor shall send a notice to the
last known address of the debtor advising them of a delinquency on
his or her account. A copy of this same notice will also be sent to
the co-signer of such account.

Section 3 establishes an effective date of January first succeeding
the date on which it shall have become a law.

JUSTIFICATION:
Current law only requires that the debtor be notified in delinquency
situations and the co-signer is forced to later reap the
repercussions. This legislation would obligate all creditors to
notify the co-signer as well of any delinquency by the debtor so that
all parties involved would be informed and the co-signer can
understand what they may liable for if the debtor continues to
default on their payments. Since a co-signer would be held
accountable for any payments that the debtor has defaulted on, it is
believed that an immediate notification of delinquency would allow
them to work out any problems with the debtor prior to the co-signer
obtaining responsibility for the debt.

LEGISLATIVE HISTORY:
S.2538 of 2009/2010; Referred to consumer protection

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE:
This act shall take effect on the first of January next succeeding the
date on which it shall have become a law.


view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                   195

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 5, 2011
                               ___________

Introduced  by  Sen. MAZIARZ -- read twice and ordered printed, and when
  printed to be committed to the Committee on Consumer Protection

AN ACT to amend the general business  law,  in  relation  to  notice  of
  delinquency requirements

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 600 of the  general  business  law  is  amended  by
adding a new subdivision 4 to read as follows:
  4. "CO-SIGNER" MEANS A NATURAL PERSON WHO (I) IN THE CASE OF A CONSUM-
ER  CREDIT TRANSACTION BECOMES OBLIGATED ON THE TRANSACTION AS A CO-SIG-
NER, CO-MAKER, GUARANTOR, ENDORSER OR SURETY, BUT WHO DOES  NOT  RECEIVE
THE PROPERTY, SERVICES, OR MONEY THAT IS THE SUBJECT OF THE TRANSACTION.
THE  TERM  DOES NOT INCLUDE A SELLER, HOLDER OR LENDER WHO BECOMES OBLI-
GATED TO AN ASSIGNEE OF SUCH PARTY'S RIGHTS; OR (II) IN THE  CASE  OF  A
CONSUMER  CREDIT  ACCOUNT  BECOMES  OBLIGATED  UNDER  THE AGREEMENT AS A
CO-SIGNER, CO-MAKER, GUARANTOR, ENDORSER OR SURETY WITH  RESPECT  EITHER
TO  ALL  PURCHASES  AND  LOANS,  OR A SPECIFIED MAXIMUM DOLLAR AMOUNT OF
PURCHASES AND LOANS THAT WILL BE OBTAINED FROM TIME TO TIME PURSUANT  TO
THE  AGREEMENT  WHETHER OR NOT IT IS CONTEMPLATED THAT THE CO-SIGNER MAY
RECEIVE ANY OF THE PROPERTY, SERVICES OR MONEY TO BE OBTAINED. THE  TERM
DOES  NOT INCLUDE A SELLER, HOLDER OR LENDER WHO BECOMES OBLIGATED TO AN
ASSIGNEE OF SUCH PARTY'S RIGHTS OR A JOINT APPLICANT FOR CREDIT  WHO  IS
INTENDED TO BE PRIMARILY LIABLE UNDER THE AGREEMENT.
  S 2. The general business law is amended by adding a new section 601-a
to read as follows:
  S 601-A. NOTICE OF DELINQUENCY. EVERY PRINCIPAL CREDITOR OR HIS OR HER
AGENT SHALL SEND A NOTICE TO THE LAST KNOWN ADDRESS OF THE DEBTOR ADVIS-
ING  THE  DEBTOR  OF A DELINQUENCY ON HIS OR HER ACCOUNT. A COPY OF SUCH
NOTICE SHALL ALSO BE SENT TO THE CO-SIGNER OF SUCH ACCOUNT.
  S 3. This act shall take effect on the first of January next  succeed-
ing the date on which it shall have become a law.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01600-01-1

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.