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AG James, Cuomo renew suspension of state debt collection in response to coronavirus, protecting New Yorkers' wallets

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Fri, Apr 17th 2020 05:15 pm

New Yorkers with student, medical and other state debt referred to AG’s office have payments frozen for an additional 30 days

New York Attorney General Letitia James and New York Gov. Andrew M. Cuomo announced the state has renewed a previous order from March 17 that halted the collection of medical and student debt owed to the state of New York and that was specifically referred to the office of the attorney general (OAG) for collection for an additional 30-day period, in response to growing financial impairments resulting from the spread of coronavirus disease 2019 (COVID-19).

The new order will run until May 17. After this 30-day period, the OAG will reassess the needs of state residents for another possible extension. Additionally, the OAG will accept applications for suspension of all other types of debt owed to the state of New York and referred to the OAG for collection.

“We renewed this order to suspend the collection of debt owed to my office, because this crisis is wreaking havoc on our state’s working people and I will do everything in my power to protect their wallets,” James said. “New Yorkers need to hold on to every dollar they have and focus on keeping their families safe and healthy. Millions across the country, including more than a million right here in New York, have filed for unemployment and are struggling to get by. While we battle this public health crisis, the last thing my office will do is add undue stress or saddle our neighbors with unnecessary financial burden. I will continue to do everything in my power to help pick up our fellow New Yorkers and support our state’s economy.”

Cuomo said, "As we continue our work to flatten the curve and stop the spread of the virus, we recognize that New Yorkers are still struggling with both emotional pain and economic hardship as a result of this crisis. By renewing the suspension on the collection of student and medical debt that is referred to the attorney general’s office for an additional 30 days, we are helping to lessen the burden faced by so many individuals, families, and businesses whose livelihoods have been affected by the pandemic. I’m grateful to the attorney general for her partnership.”

Millions of New Yorkers, like Americans across the nation, have been impacted – directly or indirectly – by the spread of COVID-19, forcing them to forgo income and business. In the five-week period ending April 11, over 22 million residents across the nation lost their jobs and filed for unemployment, including more than 1.2 million in New York alone.

The OAG collects certain debts owed to New York via settlements and lawsuits brought on behalf of the state and state agencies. A total of more than 165,000 matters currently fit the criteria for a suspension of state debt collection, including, but not limited to:

•Patients who owe medical debt due to the five state hospitals and the five state veterans’ homes;

•Students who owe student debt due to State University of New York (SUNY) campuses; and

•Individual debtors, sole-proprietors, small business owners, and certain homeowners that owe debt relating to oil spill cleanup and removal costs, property damage, and breach of contract, as well as other fees owed to state agencies.

The temporary policy has also automatically suspended the accrual of interest and the collection of fees on all outstanding state medical and student debt referred to the OAG for collection, so New Yorkers are not penalized for taking advantage of this program.

New Yorkers with non-medical or non-student debt owed to the state of New York and referred to the OAG may also apply to temporarily halt the collection of state debt. Individuals seeking to apply for this temporary relief can fill out an application online or visit the OAG’s coronavirus website to learn more about the suspension of payments. If an individual is unable to fill out the online form, they can also call the OAG hotline at 1-800-771-7755 to learn more.

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