Does the state of New York have real estate laws regulating debt collectors and/or debt buyers?
Yes. In fact, as of March 2015, New York state has some of the strongest protections for consumers in the country against debt collection and debt buyer abuses. These regulations help combat the collection of “zombie debts,” provide consumers with more information about the debts being collected and allow consumers to consent to email communications as opposed to phone calls.
What are “zombie debts?”
Simply put, “zombie debts” are previously uncollected debts that have been sold for a small percentage of their original face value to other debt collection companies, even if the statute of limitations on whether or not the debt can be collected has passed. Because the zombie debt collection company pays so little for the debts they acquire, getting paid on even a fraction of the loans makes for a profitable business model. Most companies that buy previously uncollected debts pay about 2 percent of the face value of the loan. In other words, if the original debt was $1,000, the new creditor will pay about $20 for it.
What sort of information is the debt collector required to provide to the debtor?
The collector must provide the debtor with the identity of the original creditor and an itemized accounting of the debt, including the amount of debt when the original creditor charged it off and sent it to collection, any interest that has accrued, any other fees and charges and the payments the debtor has made since charge-off.
Since many debts (especially “zombie debts”) are extremely old, consumers often have no idea what the original debt was for. This new requirement will give them information about the debt in question.
I’m selling my home - what do I need to know?
Under New York real estate law, you could be found liable to a buyer for having failed to disclose certain property conditions, or defects, in the course of the sale. Keep in mind that this is a change from prior New York law, often referred to as “caveat emptor” or “let the buyer beware.” In the past a seller could remain silent about home defects without risking liability. New York’s Property Condition Disclosure Act (PCDA) requires homeowners to complete a standardized disclosure statement and deliver it to the buyer prior to them signing the final purchase contract.
What must I include in the disclosure statement?
Your disclosure statement must include the age, ownership and utility surcharges of the property, as well as whether the property is located within a flood plain, wetlands, agricultural district or near a landfill; whether the property contains asbestos, lead pipes, or fuel storage tanks; whether a radon test has been performed on the property and whether petroleum products or hazardous or toxic substances are known to have been spilled, leaked, or otherwise released on or from the property.
The disclosure statement must also include any structural damage and the current status of all mechanical systems and services, including utilities, water source and quality, and a record of any drainage issues and/or flooding.
What happens if I don’t include the disclosure statement?
If you fail to submit the disclosure statement in a timely manner, you will owe the buyer a $500 credit toward the purchase price at closing. However, paying the $500 statutory remedy does not protect you from all liability, therefore we recommend consulting an experienced real estate attorney before making the decision to not complete the form or otherwise fail to disclose a material defect in the property.
I’m a tenant currently living in an apartment - what are my rights?
New York state law prohibits landlords from retaliating against tenants who have exercised their legal rights, such as complaining about unsafe or illegal living conditions, complaining to a government agency about unsafe or illegal living conditions, joining or organizing a tenant union and/or exercising a legal right allowed by local law, such as withholding the rent for an uninhabitable unit.
I think I need to file for bankruptcy - where should I begin?
Before you file for Chapter 7 or Chapter 13 bankruptcy, you must complete a credit counseling course from an agency approved by the U.S. Trustee in New York. You must file for bankruptcy within six months (180 days) of completing the course, or your certificate of completion will expire and you’ll need to repeat the course. After you file your bankruptcy, you must complete a debtor education course before a bankruptcy discharge is issued. You can complete these courses online, over the phone or in person.
What if I’d prefer to file a Chapter 11 bankruptcy?
Under New York state law, a Chapter 11 bankruptcy is also available as an option for individuals who owe too much money under the Bankruptcy Code to qualify for a Chapter 13 bankruptcy. For example, a homeowner with multiple properties and a sizable number of mortgages may benefit from a Chapter 11 bankruptcy, as they would retain control of their assets and possessions while undergoing debt restructuring.
Are there any bankruptcy exemptions in New York?
Yes. In fact, there are many exemptions available in New York, including those regarding your homestead, personal property, pension and/or public benefits and wages. However, because New York updates its exemptions every three years (the most recent update having occurred in April 2015), it is best to consult an experienced bankruptcy attorney for legal guidance.
