NYC DCWP Adopts Major Amendments to Debt Collection Rules Effective September 1, 2026, 2-26-2026

The New York City Department of Consumer and Worker Protections (NYC DCWP) has issued a Notice of Adoption to amend rules relating to debt collectors, with an effective date of September 1, 2026. This notice of adoption cites the NYC DCWP’s purpose as “clarifying the intent and applicability of recently adopted amendments to” the rules relating to debt collectors.

As discussed in a previous article (NYC Department of Consumer and Worker Protection Enacts New Debt Collection Rules, by Richard J. Perr, Esq., Justin Russell, Esq., and Monica M. Littman, Esq., 9-12-24 – Kaufman Dolowich), the Notice of Adoption incorporates substantial amendments to rules relating to debt collectors operating within New York City, with additional updates incorporated following the April 2025 Amendments. Some highlights associated with the April 2025 Amendments are:

• Clarification of Definitions
  • The definition of “debt collector” was revised to explain that an original creditor is not a “debt collector” until after the initiation of “debt collection procedures.” “Debt Collection Procedures” is defined to mean “any attempt by any person including an original creditor” to collect a debt: 1) after the creditor has stopped sending statements; 2) after the creditor has stopped sending bills; or 3) after the creditor has accelerated the unpaid balance.
  • The term “excessive frequency” was clarified to mean contacting a consumer in connection with the collection of a debt within a seven day period either 1) more than three times total; or 2) any time after the consumer has responded to a prior communication within the seven day period.  
     
• Validation Notice Mandatory Language Updates
  • All validation notices must include the following mandatory language:

PLEASE READ: Information About Your Rights as a New York City Consumer

• There is no time limit for a New York City consumer to dispute the debt in collection under New York City Law. You can let collectors know you dispute the debt using any of the ways they contact you, including by phone.

• You must get a response to the disputed debt in 60 days. Once you dispute the debt, the collector must stop collection. Within 60 days after receiving your dispute, a debt collector must give you either 1) verification of the debt, or 2) a “Notice of Unverified Debt” stating it can’t verify the debt or continue collection. Be sure to keep a copy of all letters.
• Inform the debt collector if any charges arise from medical debt. If you have a low or limited income, you may be eligible to apply for help under a hospital’s “Financial Assistance Policy.” Medical debt cannot be reported on your credit report. Note: Medical debt does not include charges to a credit card unless the credit card is offered specifically for the payment of health care services, products, or devices.

• A “notice of time-barred debt must be included in the validation notice if the debt was time-barred at the time of the validation notice.”  The notice must be provided in the following format:

THE TIME TO SUE ON THIS DEBT HAS EXPIRED.
IF YOU ARE SUED ILLEGALLY:
It is a violation of federal law (the Fair Debt Collection Practices Act). o You may be able to stop the lawsuit by telling the court that the statute of limitations on this debt expired.

You are not required to admit that you owe this debt, promise to pay this debt, or waive the statute of limitations on this debt.

Note: If you make a payment on this debt, the creditors’ right to sue you and make you pay the entire debt may start again. Consult an attorney or a legal aid organization to learn more about your legal rights and options

• Notice must be provided to the consumer if the debt cannot be verified.  The “Notice of Unverified Debt” (for accounts where a validation notice is required to be sent on or after September 1, 2026, excluding those accounts purchased before September 1, 2026) must include the following information:

1. include a statement in such notice that despite having received a dispute or request for verification of the debt from the consumer, the debt collector is unable to verify the debt within the time allowed by New York City law and rules;
2. except for original creditors, disclose that it will cease any further collection on the debt, and note this information, clearly and conspicuously, in the consumer’s account records;
3. for original creditors, disclose that it will cease further collection on the disputed debt unless and until verification of the debt is provided to the consumer, and note this information, clearly and conspicuously, in the consumer’s account records;
4. if applicable, disclose that the debt collector previously furnished information about the debt to a consumer reporting agency and that it will provide the disputed debt information to such agency to the extent not already provided, and upon request, provide a copy of the Notice of Unverified Debt to such agency;
5. include a statement that the consumer should retain a copy of the Notice of Unverified Debt and that the consumer may provide such notice to any other debt collector that attempts to collect on such debt;
6. include a statement that under the laws of the City of New York, any other debt collector with the information on the Notice of Unverified Debt cannot resume collection activity in New York City unless and until the verification of the disputed debt is provided to the consumer.

• Language Accessibility
  • Debt collectors must provide flexibility for a consumer to communicate in a language other than English.
  • A debt collector must also include a statement in any validation notice “informing the consumer of any language access services available.”
  • A debt collector must keep a record of the consumer’s language preference.

For debt collectors collecting from consumers located within New York City, several action items are recommended to prepare for the upcoming September 1, 2026 effective date associated with the Notice of Adoption:

• Update validation notices: review your current templates to incorporate the mandatory language required pursuant to §5-77 of the Rules of the City of New York.
• Update disclosure templates: review your current templates to ensure that they comply with §5-77 of the Rules of the City of New York.  Examples include reviewing your disclosures related to time-barred debt and disclosures related to the ability to revoke consent to electronic communications.
• Update your record retention policies and procedures: ensure that your current systems are capable of maintaining records as required by §2-193 of the Rules of the City of New York.  Examples include the ability to capture a consumer’s preferred communication language and tracking disputes.
• Update your validation and dispute procedures: a New York City consumer may dispute a debt at any time, and may do so orally, in writing, or electronically. Debt Collectors must respond to the Consumer within the time constraints set forth in §5-77 of the Rules of the City of New York.

It is vital for debt collectors to start taking the necessary steps now to ensure that they are in compliance with these significant changes before September 1, 2026.

Author:
Shera Anderson
Of Counsel
 

Richard J. Perr
Co-Managing Partner of Philadelphia Office,
Co-Chair of Financial Services & Institutions Practice Group

Monica M. Littman
Partner

Graeme Hogan
Partner

Dominic Borelli
Attorney

Kristen Ruotolo
Attorney

Samuel Sjosten
Attorney