New York is home to 19.84 million people, making it the fourth most populous state in the country. Of those people, approximately 13% live below the federal poverty line, higher than the official poverty rate of 11.6%.
Although the average personal income for a New York resident is $70,460, many New Yorkers struggle to make ends meet. The average debt per capita is around $53,620 (excluding mortgage), a hefty sum considering the high cost of living.
If you’re a New York resident seeking debt relief, or if you need other financial help, here’s what you should know.
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New York debt statistics
Here are some recent credit and debt-related statistics in New York State:
- Average household debt: $51,280
- Average student loan debt: $37,678
- Average credit score: 722
- Median mortgage payment: $2,114
- Personal bankruptcies: 20,000+
- Personal income/Annual Mean Wage: $70,460
- Child poverty: 17.7%
- Unemployment: 4.3%
Debt collection laws in New York
Recently, the state of New York passed a new law banning debt collectors from filing lawsuits on old debts. Along with this, New York has many state-specific regulations about debt collection. For example:
- Debt collectors cannot call a consumer more than seven times within a seven-day period.
- Debt collectors may only communicate with consumers within certain other regulations. For example, they cannot call between 9 pm and 8 am.
- Once they’ve made contact, a debt collector cannot call again within a seven-day period.
- A debt collector may not contact an individual at work if asked not to.
Many of these state regulations also reflect the federal Fair Debt Collection Practices Act (FDCPA), which protects consumers from unfair, deceptive, or coercive debt collection practices.
The New York Attorney General’s recent press release goes into more detail about the New York Consumer Credit Fairness Act and changes in debt collection. Among other things, the statute of limitations on consumer debts has been reduced to three years.
Read more about the consumer credit fairness act and how it affects you as a New Yorker resident.
Debt relief options for New York residents
If you need debt relief in New York but don’t know where to start, here are your best options:
- Debt settlement: Debt settlement is the process of negotiating with creditors to try to reduce how much you owe on a particular debt. It’s possible to do debt settlement on your own, but most people go through a professional company.
- DIY plans: A DIY debt settlement plan is another way to lower the amount you owe, but it does require good negotiation skills. Even if you can’t settle your debts, you may be able to get a better repayment plan, waive late fees, or lower interest rates. This could also help if you’re being harassed by debt collectors.
- Debt management plan: Offered through credit counseling agencies, DMPs are three- to five-year plans that can help you pay off debts. With a DMP, you may be able to get better terms and rates, too.
- Debt consolidation loans: With a debt consolidation loan, you can merge several unsecured debts into one loan with a single monthly payment. This may be a good option if you have excellent credit as it could come with a lower interest rate and save you money.
- Bankruptcy: Personal bankruptcy — Chapter 7 or Chapter 13 — could be an option if you’re drowning in debt and nothing else works. Speak with a bankruptcy attorney about whether this option is right for you.
Want to learn more about negotiating your own debt settlement? Check out this video:
Debt settlement in New York
Debt settlement may be right for you if you’ve fallen behind on bills or are unable to make multiple monthly payments on your debts. It may also be a good option if you’re starting to use expensive forms of credit — ex. payday loans and credit cards — for daily expenses.
With a debt settlement, your creditor agrees to accept a payment that’s smaller than what you originally owed on your debt. This can reduce your overall debt amount, as well as cut down on how much you pay each month on your minimums.
Debt settlement may not help with secured debts, but it can help with many unsecured debts, including:
- Credit cards
- Personal loans
- Student loans in default
- Old judgments
- Department store cards
If you go through a professional debt settlement agency, the entire process can take between two and four years, on average.
Debt settlement is not a guarantee, and it’s not without its risk. For example, a debt settlement company may tell you to quit making payments to your creditors to increase the odds of success. This could lead to late payments and damage your credit score. Any settled debt could be considered taxable by the IRS, too.
If successful, you could get your debts settled by as much as 50% — sometimes more. This could make it easier to get back on track financially and repay any debts you still owe.
New York debt relief companies
If you’re looking for help with expensive debts, these top New York debt relief companies may be able to help:
- The Debt Relief Company: 99 Wall Street #725 New York, NY 10005; (844) 344-0214
- The Debt Management Group: 2653 Coney Island Ave Fl 2 Brooklyn, New York 11223 or 137 Kreischer Street Staten Island NY 10309; (800) 667-3328
- National Debt Relief LLC.: 180 Maiden Lane 30th Floor New York, NY 10038 or 11 Broadway #1732 New York, NY 10004; (888) 502-6611
- United Debt Settlement: 240 West 37th Street Suite 400 New York, NY 10018; (888) 574-5454
- Citizens Debt Relief: 697 3rd Ave, Suite 105 New York, NY 10017; (800) 560-3956
- Settle Bank Debt: 99 Wall St #189, New York, NY 10005, USA; (877) 492-7222
Debt settlement attorneys
For New Yorkers interested in debt settlement, here are a few attorneys to consider:
- Law Office of Simon Goldenberg: 258 Highlawn Ave 1st Floor, Brooklyn, NY 11223; (347) 640-4357
- Karra L. Kingston Esq: 160H Dinsmore St, Staten Island, NY 10314; (973) 979-9078
- Lakeview Law Group, PLLC: 463 7th Ave 9th floor, New York, NY 10018; (888) 525-3477
- Law Offices of Joseph I Harrison: 34 Gefen Drive Lakewood, NJ 08701; (203) 444-3551
Debt resources for New York residents facing hardship
The state of New York has many programs and resources for residents facing hardship. Some programs offer financial assistance for things like utility bills, rent, or mortgage payments. Others can help with childcare or healthcare costs.
About one in 10 New Yorkers — or 1,882,580 people — face hunger. Nearly 600,000 of that number is children. Fortunately, New York also has several food banks and pantries for those facing food insecurity or hunger.
Here are a few of the main food banks:
- Food Bank for New York City: 39 Broadway, 10th Floor New York, NY 10006; (212) 566-7855
- Food Bank of the Hudson Valley: 195 Hudson Street Cornwall-on-Hudson, NY 12520; (845) 534-5344
- Foodbank of the Southern Tier: 388 Upper Oakwood Ave. Elmira, New York 14903; (607) 796-6061
- Feeding Westchester: 200 Clearbrook Road, Elmsford, NY 10523; (914) 923-1100
- FeedMore WNY: 100 James E. Casey Dr. Buffalo, NY 14206; (716) 822-2002
Here’s a comprehensive list of New York State’s Food Pantries. Feeding America New York also has a directory of local food banks throughout the state.
Income and employment in New York
New York currently ranks 22nd in terms of job creation with 305,100 new jobs. With that said, the current unemployment rate is still 4.3%, which is bit higher than the national unemployment rate of 3.7%. It is a major improvement from what it was during the height of the pandemic — 16.5%.
The state of New York is not a right-to-work state, but it is an employment-at-will state. This means an employer can fire any employee with or without a reason (barring illegal ones).
How to apply for unemployment benefits in New York
There are two ways to apply for unemployment benefits in New York:
- Online: Create an NY.gov ID account online. Then, start the online application and follow the prompts until it’s done.
- Phone: Call (888) 209-8124 between 8:00 am and 5:00 pm EST Monday through Friday.
You’ll need your driver’s license or motor vehicle ID card, current mailing address, SSN, details about your previous employers, and a few other documents.
Most people who are eligible for benefits receive their first payment within two to three weeks from when their claim is completed and processed. After applying, you’ll also receive a Monetary Determination detailing your weekly benefit amount and other key details. You’ll need to recertify for benefits every week you’re unemployed.
Banking and taxes in New York
In New York, the personal income tax rate ranges from 4% to 10.9%. It’s based on your adjusted gross income as well as your filing status. Here are the current tax brackets for single filers:
- 4.00% for the first $0 to $8.500
- 4.50% for $8.501 to $11,700 (plus $340)
- 5.25% for $11,701 to $13,900 (plus $484)
- 5.90% for $13,901 to $21,400 (plus $600)
- 5.97% for $21,401 to $80,650 (plus $1,042)
- 6.33% for $80,651 to $215,400 (plus $4,579)
- 6.85% for $215,401 to $1,077,550 (plus $13,109)
- 9.65% for 1,077,550 to $5 million (plus $72,166)
- 10.30% for $5,000,001 to $25 million (plus $450,683)
- 10.90% for anything above $25 million (plus $2,510,683)
For married people who file jointly, the income tax roughly doubles for each tax bracket. If you live in New York City, you may also be subject to local income tax, which ranges from 3.078% to 3.876%.
The tax rate can vary based on certain factors, so be sure to check the current rates before filing.
One other thing to note is that 5.9% of New Yorkers are currently unbanked. This means they have neither a checking nor a savings account.
New York housing market
In New York, the homeownership rate is an estimated 54.2%. According to Zillow, the current average housing price in the state is $782,640, up 6.2% over the past year. This is more than double the national average.
The median mortgage payment is $2,156. In contrast, the median rent payment in New York City is $2,118 for a two-bedroom apartment.
The New York State Homeowner Assistance Fund was established to help homeowners with housing costs. The application period is now closed, but there is a waiting list for those who need assistance.
Retirement in New York
The average New Yorker needs about $1,277,315 set aside in order to live comfortably in retirement. However, the average retirement savings amount is closer to $382,027.
Average New York insurance premiums
The average homeowners’ insurance premium in New York is $1,289 annually for a $250,000 dwelling coverage. This is about average in the country.
A standard car insurance policy with full coverage is around $2,996 yearly. This is nearly $1,200 higher than the national average cost.
Payday lending status in New York: Prohibited
Payday loans are illegal in many states throughout the United States, including New York.
- Maximum loan amount: N/A
- Maximum Interest Rate (APR): N/A
- Minimum loan term: N/A
- Maximum loan term: N/A
Statute of limitations on debt in New York
The statute of limitations is what limits how long a creditor or debt collector has to sue a borrower for defaulting on an account. In New York, it’s three years:
- Medical debt: 3 years
- Credit card: 3 years
- Auto loan debt: 3 years
- State tax debt: 3 years
State hardship programs
New York has multiple state and federal programs to help people dealing with debt or expensive bills, including:
- Rental Housing Hardship Program: The New York City Housing Authority streamlined its rent hardship policy so residents negatively impacted by COVID-19 could apply for a potential rent reduction based on income. Apply via the self-service portal or phone at (718) 707-7771.
- Rental Assistance program: This resource connects residents with different rental assistance programs. For example, FHEPS offers a rent supplement to those who are homeless due to domestic violence or safety issues.
- COVID Rent Relief Program: This rent relief program has ended.
- Emergency Rental Assistance Program: This program offers relief to low- and moderate-income families and those facing homelessness.
- Single Family Housing Repair and Grants Program: The Section 504 Home Repair program helps low-income homeowners pay for repairs and modernize their home.
- Home Energy Assistance Program: This program helps with heating bills and keeps the power on. For this and many other benefits, create an account with myBenefits.
- Low Income Energy Assistance Program: LIHEAP is a federal program that helps with energy bills and weatherization. Apply here.
- Child Health Plus Program: This health insurance program helps eligible families with children under the age of 19 with their healthcare costs.
- Supplemental Nutrition Assistance Program: SNAP offers financial aid to low-income households who need help with food costs.
- Combined Application Project: Eligible homeowners or renters could receive energy efficiency incentives through the Assisted Home Performance with ENERGY STAR® or the EmPower program of New York.
- Women, Infants, and Children: WIC provides lifestyle tips, advice, and food nutrition to women and children.
- For Women: This comprehensive resource offers information about women’s health, pregnancy, and more.
- Refugee services: This resource connects refugees with program providers throughout the state to help with settling into the state.
- Immigration services: This resource offers health initiatives, emergency shelter, and other resources for immigrants.
Help for Veterans
In 2020, New York had 747,157 veterans. The New York Department of Veteran Affairs has many resources available to help those facing homelessness, unemployment, or other hardships.
Facilities in New York
Looking for a VA near you? Here’s a list of the main ones in the state:
- Buffalo VA Medical Center: 3495 Bailey Avenue Buffalo, NY 14215-1129; (716) 834-9200
- Margaret Cochran Corbin VA Campus: 423 East 23rd Street New York, NY 10010-5011; (212) 686-7500
- Samuel S. Stratton Department of Veterans Affairs Medical Center: 113 Holland Avenue Albany, NY 12208-3410; (518) 626-5000
- Brooklyn VA Medical Center: 800 Poly Place Brooklyn, NY 11209-7104; (718) 836-6600
- Northport VA Medical Center: 79 Middleville Road, Building 200 Northport, NY 11768-2200; (631) 261-4400
- Bronx Vet Center: 2471 Morris Avenue Suite 1A Bronx, NY 10468-5450; (718) 367-3500
- Brooklyn Vet Center: 25 Chapel Street Suite 604 Brooklyn, NY 11201-1954; (718) 630-2830
- New York Regional Office: 245 W. Houston St. New York, NY 10014; (800) 827-1000
- Buffalo Regional Office: 130 South Elmwood Ave. Buffalo, NY 14202; (800) 827-1000
- Cypress Hills National Cemetery: 625 Jamaica Avenue Brooklyn, NY 11208; (631) 454-4949
Employment resources for Veterans
For veterans seeking employment, here are some state and nationwide options:
- CareerOneStop for career advice, resources, and a job search portal
- MilitaryHire.com for veterans and spouses seeking employment in the civilian sector
- VeteranRecruiting.com for online career fairs and various employment resources
- Helmets to Hardhats for networking and transitioning into the construction industry
- Hiring Our Heroes for hiring opportunities and networking with potential employers
- My Next Move for employment opportunities that use military skills in civilian life
- Warriors to Work for connecting veterans with companies
The bottom line
If you’re struggling with the high cost of living or large amounts of debt, New York debt relief exists in many forms. This includes state and federally-funded programs and resources, as well as options like debt settlement, debt consolidation, and credit counseling. Don’t hesitate to get the help you need when you need it.
Creditors or debt collectors can file a lawsuit to try to collect on a debt for three years on most consumer debts. Prior to the Consumer Credit Fairness Act of 2021, it was six years.
The statute of limitations begins on the date of the last activity on the account.
This depends. New York is an equitable distribution state, meaning debts are divided based on what’s considered fair. This does not always mean it will be split equally.