New York suspends debt collection for medical, student loans
New York has suspended debt collection across the state.
New Yorkers who owe money to the state, effective immediately, will no longer have to pay their student debt, medical debt, and other forms of state-referred debt, for at least 30 days.
In other words, these outstanding debts will be “frozen,” according to a tweet by New York Governor Andrew Cuomo.
A medical professional wearing a protective face mask walks past a line of ambulances outside the NYU Langone Hospital Emergency room entrance, Monday, March 16, 2020, in New York. (AP Photo/John Minchillo)
This measure was taken in response to the spread of the coronavirus, or COVID-19.
“Countless New Yorkers have been impacted — directly or indirectly — by the spread of COVID-19, forcing them to forgo income and business,” a press release from the Attorney General’s office stated. “In an effort to support these workers and families and ease their financial burdens, the OAG will halt the collection of medical and student debt owed to the State of New York …”
“We’re doing all we can to support those suffering financially due to #COVID19,” Cuomo wrote in a tweet.
NEW: Effective immediately, @NewYorkStateAG & I are suspending state debt collection.
NYers with student debt, medical debt & other state-referred debt will have payments frozen for at least 30 days.
We’re doing all we can to support those suffering financially due to #COVID19.
— Andrew Cuomo (@NYGovCuomo) March 17, 2020
More than 165,000 debts are affected by the decision, Attorney General Letitia James said on Tuesday.
“In this time of crisis, my office will not add undue stress of saddle New Yorkers with unnecessary financial burden,” she said.
This includes patients that owe medical debt to the five hospitals, and the five veterans’ homes, student debt owed by borrowers to the State University of New York, and other debtors.
The suspension also pauses accrual of interest and collection of fees on all outstanding debt.
To be clear, the suspension of debt collection helps borrowers with private loans, rather than those with federal loans, Natalia Abrams, Executive Director of Student Debt Crisis, told Yahoo Finance.
Follow the news here.
—
Aarthi is a writer for Yahoo Finance. She can be reached at [email protected]. Follow her on Twitter @aarthiswami.
Read more:
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, SmartNews, LinkedIn, YouTube, and reddit.