With third-party debt buyers taking advantage of the courts and consumers to extract hundreds of millions of dollars a year from the lowest income New Yorkers, State Senator Jose Peralta introduced legislation to prevent debt buyers from exploiting gaps in state laws.
Consumer debt buyers have filed hundreds of thousands of debt collection lawsuits over the past few years in New York State. They buy consumer debts for pennies on the dollar and aggressively pursue payment through the courts—often suing the wrong people or consumers who paid back their debt years before. Even in cases where a consumer may owe money, debt buyers often sue for grossly inflated amounts, padding the debts with unauthorized fees and interest.
“We’ve all heard the horror story about someone hounded relentlessly for years by debt collectors for bills that were paid off long ago, or for payments that were never owed, or for wildly high fees that would make a loan shark proud,” said Senator Peralta. “The thuggish tactics described are so abusive, it’s hard to imagine that sort of harassment is allowed to happen in the United States.
