What it means for you
Since April 30, 2022, a court judgment against you over a personal debt like a credit card, medical bill, or student loan grows at 2% a year instead of 9%. The lower rate also applies to old judgments that were still unpaid.
Who benefits: New Yorkers who owe a court judgment over a personal, family, or household debt, including medical and student debt.
When a creditor or debt collector sues you in New York and wins, the court enters a judgment for what you owe, and interest keeps adding to it until it’s paid. For more than 40 years, that interest ran at 9% a year. On a $5,000 judgment, that’s $450 a year on top of the debt. For personal debts like credit cards, medical bills, and student loans, the rate is now 2%, which comes to $100 a year on the same judgment.
You don’t have to do anything to get the lower rate. It took effect April 30, 2022, and covers new judgments as well as old ones that were still unpaid that day. It doesn’t refund interest you paid before then. Business debts still carry 9%.
Sen. Kevin Thomas, who chaired the Senate Consumer Protection Committee, and Assemblymember Helene Weinstein carried the bill. Groups including AARP and the NAACP backed it. It passed the Senate 45–18 in June 2021, and Gov. Kathy Hochul signed it on December 31, 2021. Three credit unions sued, arguing that cutting interest on old judgments was an unconstitutional taking. In September 2025 a federal court ruled that it wasn’t, and the 2% rate is still the law.
Lower costsRights
Sources
- Senate Bill S5724A (2021-2022 Session)New York State Senate
- CPLR 5004, Rate of interestNew York State Senate
- Governor Hochul Signs Consumer Judgement Interest Act Into LawOffice of Sen. Kevin Thomas, December 31, 2021
- Assembly Bill A06474 historyNew York State Assembly
- New law addresses statutory judgment interest ratesSpectrum News, January 14, 2022
- New York reduces judgment rate on consumer debts to 2%Ballard Spahr Consumer Finance Monitor, January 6, 2022
- Federal court upholds New York's retroactive reduction of consumer debt judgment interest rateReceivables Management Association International, October 10, 2025
How we checked this
Drafted by Claude Opus 5.5 (Anthropic) on November 11, 2026. Checked against its sources by GPT-5.6-sol (OpenAI) on November 11, 2026, with no problems found. Confirmed the law’s scope, dates, sponsors, 45–18 Senate vote, impact figures, litigation outcome, and continued enforcement through 2026. The entry meets the editorial and net-impact standards.
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