THE PURPOSE OF THE CONSUMER CREDIT FAIRNESS ACT
According to the Consumer Credit Fairness Act (CCFA), its statute of limitations, in general, starts to run once a borrower misses a payment. The statute of limitations is reset if the borrower makes another payment and then falls behind on their financial obligations again. This means that, in most cases, the statute of limitations for suing you for nonpayment begins when you miss a payment. If you make sporadic payments on your debt and then miss a payment period again, the statute of limitations period will reset.
Because of the safeguards provided by the CCFA, if you haven't been in compliance with your repayment obligations for three years or more in a row and a creditor hasn't yet filed a lawsuit against you for non-payment, you're probably safe from being forced to pay back that creditor. If a creditor attempts to collect on an unpaid debt for more than three years, consult with an attorney before paying. While you technically still owe the debt, the creditor is unlikely to be able to sue you for the unpaid balance.
AMENDMENTS IN THE NEW YORK CIVIL PRACTICE LAWS AND RULES
The rate of interest for consumer debt judgments is now capped at 2% instead of the previous cap of 9% under the NY Civil Practice Laws and Rules (CPLR) amendment. This means that while you are paying off your balance, a creditor who sues you and wins a judgment against you is only permitted to charge you two percent interest on the amount of the judgment. This is a significant improvement over the previous cap, which came dangerously close to allowing lenders to charge consumers a whopping 10% interest rate on judgment balances in debts with which they were already struggling.
To Find Out More, Speak With An Experienced Consumer Rights Attorney
If a creditor has sued you for a zombie debt or any other overdue financial obligation that the CCFA may have time-barred, contact our firm to learn more about your legal options. Our experienced team believes that legal safeguards are ineffective if borrowers are unaware of their rights and how to exercise them. As a result, we are pleased to provide a free initial case evaluation to anyone interested in learning more about their legal options.