2021 Policy Platform
NYRL’s 2021 policy platform addresses the economic challenges and injustices that New Yorkers face in light of the economic impact of the COVID-19 crisis, which disproportionately affects communities of color, and it reflects NYRL members’ experiences working in communities across New York State.
- Pass the Consumer and Small Business Protection Act (CSPA): NYRL strongly supports A2495 to amend New York’s primary consumer protection statute (GBL § 349) to conform with the majority of state consumer protection laws that broadly prohibit unfair business practices. Reform is needed now more than ever, in the wake of the COVID-19 crisis and the emergence of bad actors seeking to exploit vulnerable New Yorkers with unfair products and practices. The bill enhances access to justice for consumers and small businesses harmed in financing, mortgages and housing, insurance, student loans, and other transactions. The bill also simplifies pleading requirements and updates the outdated damages cap set 40 years ago.
NYRL’s Workgroup Priorities Also Include:
- Protect Consumers Facing Debt Collection, Including Abusive Collection Lawsuits: the COVID-19 crisis has caused widespread financial distress leaving millions of New Yorkers, particularly in communities of color, unable to pay bills (including increased medical debts). This distress will result in a spike of debt collection lawsuits against New Yorkers who are least able to defend themselves or afford prohibitively high judgments. NYRL supports three actions to help consumers impacted by COVID-19:
- Judgment Interest Rate Reduction – set a market rate for judgments by tying the interest rate on consumer debt to the one-year U.S. Treasury bill rate that applies to federal court judgments, replacing the current statutory rate of 9% (2020: A.10479/S7946B);
- Patient Medical Debt Protection Act – protect hospital patients from surprise fees and other unfair billing practices (2020: A8639/S6757); and
- Consumer Credit Fairness Act (A2382/S153) – address the longstanding epidemic of abusive debt collection lawsuits brought by debt buyers lacking sufficient evidence and collecting on “zombie debt” beyond the statute of limitations.
- Curb Predatory Auto Lending: NYRL supports legislation to address predatory subprime auto lending, impose caps on interest-rate markups, and require clear disclosure of all fees and add-ons. NYRL also supports A819, which restores the interest rate cap for auto lending that applies to most other consumer transactions in NYS.
- Keep Payday Loans and Other Predatory and Usurious Financial Products Out of NYS and Encourage Safe Alternatives: the COVID-19 crisis is not an excuse to permit harmful financial products to enter the NY market. These products lead to an inescapable debt trap that strip assets from lower-income consumers. NYRL strongly opposes any effort to evade NY’s strong usury laws, including attempts to expand check casher services, permit access to high-cost credit, or introduce novel, high-cost loan products in previously unregulated contexts such as pension advances, litigation funding, or employer wage advances.
- NYRL opposes efforts to allow employers to effectively make payday loans above our 25% interest cap. Essential workers like lower-wage retail and food service workers would be targeted and most harmed (2020: A10309/S8206).
- NYRL opposes lending on future lawsuits with interest rates over our state cap (as high as 36%), poking a giant hole in NY’s protections (2020: A6764/S4555).
- NYRL supports funding NY’s CDFI Fund and expanding the lending capacity of CDFIs and CDCUs by allowing municipal and state governments to place deposits with them, bringing capital to underserved communities, and making meaningful investment in safe alternatives to predatory lending.
- Prohibit the Use of Credit Report Data and Other Socioeconomic Factors in Insurance Rating and Underwriting: NYRL supports A3082, which bans the use of credit reports and other socioeconomic factors in the underwriting and pricing of home and automobile insurance. Insurers’ use of this data often has a disparate impact on communities of color and disproportionately burdens lower-income New Yorkers with higher insurance costs. The NYS Department of Financial Services (DFS) recently banned the use of education and occupation as ratings factors for auto insurance pricing, but the use of credit report data continues to have serious discriminatory impacts.
- Homeowners’ Insurance Data Disclosure: NYRL supports requiring residential property insurers to disclose data regarding the geographic locations of policies written, premiums collected, and losses incurred (2020: A2348). Transparency regarding where insurers are writing homeowners’ policies will help ensure fair access to affordable, quality insurance for homeowners in low-income communities and communities of color.
- HOPP Funding: NYRL seeks to ensure that $20 million is included in the budget for continuation of the Homeowner Protection Program (HOPP), the statewide network of 88 non-profit housing counseling and legal services providers assisting delinquent homeowners in every county of the state. Almost four times as many NY homeowners are delinquent today on their mortgages than at the height of the Great Recession in 2009. As moratoriums and forbearance programs end, NY could see its worst foreclosure crisis. HOPP is a crucial part of the safety net for homeowners to avoid homelessness, to stabilize neighborhoods and to sustain NY’s economic well-being.
- Making DFS Mortgage Servicing Regulations Enforceable: NYRL supports A2428/S2143 to amend Banking Law 12-D and establish a private right of action for violations of the NYS Department of Financial Services strong mortgage servicing regulations (Part 419). With the high number of delinquent homeowners, servicing abuses will proliferate. DFS mortgage servicing regulations, which govern a wide array of mortgage servicing abuses and mandate consumer protections in the loss mitigation process, are of the greatest importance now.
- Protections for New York Student Loan Borrowers: The COVID-19 crisis is exacerbating what was already a national student loan debt crisis. Student loan borrowers need much stronger consumer protections, including:
- Continued suspension of the collection of debt owed to the State;
- Ban the withholding of college transcripts as a debt collection practice. A withheld transcript prevents a student from going to any school until the entire tuition debt is paid off. This has a disproportionate impact on brown and black students who often lack a parent or sibling who can write a $6,000 check (the typical amount owed when a transcript is withheld);
- Mandate that student loan collection cases be brought in the home county of the borrower instead of Albany, depriving borrowers of access to justice, especially during the COVID-19 crisis;
- Reduce the interest rate on civil judgments from 9% to a rate based on the one-year US Treasury bill rate (2020: A.10479/S7946B).
- Support Funding for the Education Debt Consumer Assistance Program (EDCAP): NYRL supports increased funding for EDCAP to provide unbiased, one-on-one student loan debt consumer assistance to New Yorkers.
- Greater Accountability of For-Profit Higher Education Institutions: NYRL supports greater accountability of for-profit institutions including A3308/S299, which enhances disclosure and transparency regarding fees, costs, average student debt loads, performance, and profits. Nearly half of the state’s student loan defaults emanate from for-profit schools because these schools often leave students with degrees that can’t get them get good jobs.
- Protections for Borrowers of Private Student Loans: NYRL supports legislation that protects co-signers of student loans, who are primarily older consumers, by requiring enhanced disclosures, providing a simpler process for cosigners to be released, and prohibiting acceleration of a loan based on a co-signer’s death or bankruptcy. NYRL also supports legislation prohibiting robo-signing documents in collection lawsuits and requiring providing basic information when collecting on a loan.