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AG James renews suspension of state debt collection for 7th time as coronavirus continues to impact New Yorkers' wallets


Mon, Oct 5th 2020 10:40 am

New Yorkers with student and medical debt referred to AG’s office; will have payments automatically frozen through Nov. 3

New York Attorney General Letitia James announced the state has renewed – for the seventh time – an order to halt the collection of medical and student debt owed to the state of New York that has been specifically referred to the Office of the Attorney General (OAG) for collection for an additional 30-day period. In response to continuing financial impairments resulting from the spread of the coronavirus disease 2019 (COVID-19), the OAG again renewed orders, now through Tuesday, Nov. 3. After this 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.

“Coronavirus is not gone, and neither are the financial hardships New Yorkers are facing as a result of it,” James said. “It is my hope that, by again renewing the suspension of state student and medical debt referred to my office, we can reduce the burden faced by individuals and families during these difficult times. I will continue to do everything in my power to support our state’s economy so that New Yorkers can support themselves.”

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. Since COVID-19 began to spread rapidly across the country in mid-March, tens of millions of residents across the nation have filed for unemployment, including more than 3.8 million in New York state alone.

In an effort to support New Yorkers economically impacted during this difficult time, James renewed the order – first made in March and renewed in April, in May, in June, in July, in August and in September – to ease the financial burdens for workers and families by halting the collection of medical and student debt owed to the state of New York and referred to the OAG for collection.

The OAG collects certain debts owed to the state via settlements and lawsuits brought on behalf of New York 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 who 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 800-771-7755 to learn more.

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