New York Judgment Interest 2026: 9% General or 2% Consumer Rate

9% or 2%: Which New York Judgment Interest Rate Applies to Your Case?

New York now has two post-judgment interest rates under CPLR § 5004(a), and which one applies depends entirely on the nature of the underlying debt and who the defendant is.

The General Rate — 9% Per Year: The 9% rate is the default and applies to the vast majority of civil judgments in New York. This includes commercial contract disputes, business-to-business claims, tort cases such as personal injury and property damage, landlord-tenant disputes in commercial settings, and any other judgment where the defendant is a business entity or where the debt does not qualify as consumer debt under the Fair Consumer Judgment Interest Act.

The Consumer Rate — 2% Per Year: Since April 30, 2022, the 2% rate applies when two conditions are both met. First, the judgment must arise from consumer debt — meaning debt incurred primarily for personal, family, or household purposes. Second, the defendant must be a natural person, not a corporation, LLC, or other business entity. When both conditions are satisfied, the 2% rate applies regardless of the dollar amount of the judgment.

Why This Matters in Practice: Many creditors, collection attorneys, and even clerks default to applying 9% across the board. For consumer debt judgments against individuals, this is legally incorrect since the 2022 reform. A judgment debtor who is being charged 9% on a credit card judgment entered after April 30, 2022 is being overcharged by 7 percentage points per year.

The rate determination is made at the time the judgment is entered and does not change based on subsequent assignments of the judgment or transfers between creditors.

The 2022 Reform: How the FCJIA Changed Consumer Debt Judgments

The Fair Consumer Judgment Interest Act (FCJIA) was signed into law and took effect on April 30, 2022. It amended CPLR § 5004 to add the 2% rate for consumer debt judgments against natural persons — a significant departure from New York's longstanding 9% flat rate.

What Changed: Before April 30, 2022, all New York civil judgments accrued interest at 9% regardless of the type of debt or the nature of the parties. The FCJIA created a bifurcated system: 9% remains the general rate, but 2% applies specifically when the judgment debt is consumer debt and the defendant is a natural person.

The Retroactivity Provision: The FCJIA includes a retroactivity provision that affects judgments entered before April 30, 2022. For any portion of a pre-2022 consumer debt judgment that remained unpaid as of the effective date, interest on that unpaid balance converts to the 2% rate going forward from April 30, 2022. The statute specifically provides for interest upon a judgment pursuant to CPLR § 5003 from the date of entry of judgment on any part of a judgment entered before the effective date that is unpaid as of such effective date.

What This Means for Old Judgments: If a consumer debt judgment was entered in 2018 and the debtor still owed money on April 30, 2022, the unpaid balance began accruing at 2% — not 9% — from that date forward. Creditors who continued applying 9% to pre-2022 judgments after April 30, 2022 were overcharging.

Definition of Consumer Debt Under the FCJIA: Consumer debt means debt or any obligation or alleged obligation arising out of a consumer transaction — in other words, a transaction where money, property, insurance, or services are the subject of the transaction and these are acquired primarily for personal, family, or household purposes.

Definition of Natural Person: A natural person is a human being, as opposed to a corporation, LLC, partnership, or other business entity. A sole proprietor operating as an individual may qualify as a natural person, but this depends on how the transaction was structured.

When Does the 9% Rate Still Apply?

The 9% rate remains the standard for a broad range of New York civil judgments and has not been affected by the FCJIA in these categories.

Commercial Contract Disputes: Any judgment arising from a contract between two business entities accrues interest at 9%. This covers trade disputes, vendor-customer claims, breach of commercial leases, and business loan defaults where the borrower is an entity rather than an individual.

Tort Cases: Personal injury judgments, property damage claims, negligence cases, and other tort-based judgments all accrue at 9%. The nature of the underlying claim — not the financial status of the defendant — determines the rate for these cases. Tort judgments are not consumer debt regardless of who the defendant is.

Landlord-Tenant (Commercial): Judgments arising from commercial lease disputes, including unpaid rent in commercial settings, accrue at 9%. Only residential rent arrears owed by an individual qualify as consumer debt under the FCJIA analysis.

Judgments Against Business Entities: Any judgment where the defendant is a corporation, LLC, partnership, or other non-natural person entity accrues at 9%, even if the underlying debt would otherwise qualify as consumer debt. For example, if an LLC took out a credit card in the business name and defaulted, the resulting judgment would carry 9% regardless of how the card was used.

Statutory Claims: Judgments under New York Labor Law, Lien Law, or other statutory schemes generally carry the 9% rate unless the specific statute provides otherwise.

Practical Tip for Creditors: When preparing default judgment papers in New York, the application must state the applicable interest rate. Using 9% on a consumer debt judgment against an individual entered after April 30, 2022 creates legal exposure — the debtor can challenge the interest calculation, and courts have begun scrutinizing this.

When the 2% Rate Applies: Consumer Debt Against Natural Persons

The 2% rate applies when both prongs of the FCJIA test are satisfied simultaneously.

Prong 1 — Consumer Debt: The underlying obligation must be consumer debt. This includes credit card debt incurred for personal use, medical bills for personal or family healthcare, private student loans used for personal education expenses, residential rent arrears owed by a tenant, personal auto loans, and retail installment contracts for household goods or personal vehicles.

Prong 2 — Natural Person Defendant: The judgment must be against a natural person. If a joint debt is owed by both an individual and a business, the analysis may differ depending on how the judgment is structured.

Common Examples of 2% Judgments After April 30, 2022: - Credit card judgment: A collection agency sues a consumer for $8,000 in unpaid credit card debt. The resulting judgment carries 2% annual interest. - Medical debt judgment: A hospital system obtains a $15,000 judgment against an individual patient. Interest accrues at 2%. - Private student loan judgment: A private lender obtains judgment on a defaulted student loan against the borrower individually. Rate is 2%. - Residential landlord-tenant: A landlord obtains a money judgment for $6,000 in unpaid residential rent against a tenant who is a natural person. Rate is 2%.

Important Caveat — Self-Help Is Not Enough: The court entering the judgment does not automatically apply the correct rate. The party seeking judgment must identify the applicable rate in the papers. If a creditor requests 9% on a consumer debt judgment, the clerk may enter it at 9%. The debtor's remedy is to move the court to correct the rate or raise it in a satisfaction of judgment proceeding.

Step-by-Step: Calculating NY Judgment Interest

New York post-judgment interest is simple interest, calculated from the date the clerk enters the judgment.

Formula: Interest = Principal × Rate × Years

Or expressed daily: Daily interest = Principal × Rate ÷ 365

Commercial Example — $100,000 at 9%, 3 Years: - Principal: $100,000 - Rate: 9% per year - Duration: 3 years - Annual interest: $100,000 × 0.09 = $9,000 - Total interest: $9,000 × 3 = $27,000 - Total owed: $127,000

Consumer Debt Example — $100,000 at 2%, 3 Years: - Principal: $100,000 - Rate: 2% per year - Duration: 3 years - Annual interest: $100,000 × 0.02 = $2,000 - Total interest: $2,000 × 3 = $6,000 - Total owed: $106,000 - Difference from 9%: $21,000 saved over 3 years

Daily Rate — Commercial Judgment of $50,000 at 9%: - Daily interest: $50,000 × 0.09 ÷ 365 = $12.33/day - Monthly: approximately $370/month

Daily Rate — Consumer Debt Judgment of $50,000 at 2%: - Daily interest: $50,000 × 0.02 ÷ 365 = $2.74/day - Monthly: approximately $82/month

Accrual Start Date: Interest begins accruing the day the clerk enters the judgment in the court's records. This is the docketing date, which may differ from the date of the judge's order or decision by days or weeks. When calculating a payoff amount, obtain the exact docket entry date from the court.

Partial Payments: When partial payments are made, courts typically apply the payment first to accrued interest and then to principal. This means the remaining principal continues to generate interest at the applicable rate.

Use the calculator above to estimate total interest based on the judgment amount, the applicable rate (9% or 2%), and the number of days or years since judgment entry.

Pre-Judgment Interest Under CPLR § 5001

In addition to post-judgment interest under CPLR § 5004, New York also provides for pre-judgment interest under CPLR § 5001. This is interest that accrues before the judgment is entered, running from a date determined by the statute to the date of judgment.

When Pre-Judgment Interest Applies: CPLR § 5001 allows recovery of pre-judgment interest in actions involving breach of contract, conversion, and other specific claims. Courts have discretion in some cases, but for contract claims the award of pre-judgment interest is mandatory.

Start Date for Pre-Judgment Interest: CPLR § 5001(b) provides that interest shall be computed from the earliest ascertainable date the cause of action existed. In practice this is often the date of the breach, the date damages were incurred, or the date a demand was made — depending on the nature of the claim.

Rate for Pre-Judgment Interest: Pre-judgment interest in New York accrues at 9% per year under CPLR § 5004, applied to the principal amount of the claim from the statutory start date to the date of judgment entry.

How Pre- and Post-Judgment Interest Connect: On the date judgment is entered, pre-judgment interest calculation ends and post-judgment interest begins. The total amount of the judgment — including any awarded pre-judgment interest — then becomes the new principal for post-judgment interest purposes.

Example — Contract Claim with Pre-Judgment Interest: - Breach date: January 1, 2024 - Judgment entered: January 1, 2026 - Judgment amount (excluding interest): $40,000 - Pre-judgment interest (9% for 2 years): $40,000 × 9% × 2 = $7,200 - Total judgment entered: $47,200 - Post-judgment interest then accrues on $47,200 at the applicable rate

For consumer debt cases after April 30, 2022, there is ongoing debate about whether the 2% rate also applies to pre-judgment interest. Courts are still working through this question; consulting a New York attorney is advisable for consumer debt cases with significant pre-judgment interest claims.

Federal Court Judgments: Why 28 U.S.C. § 1961 Applies Instead

One of the most common points of confusion for New York litigants is the difference between state court and federal court judgment interest.

When a case is litigated in a New York state court — Supreme Court, Civil Court, Family Court — the resulting judgment carries interest under CPLR § 5004: either 9% (general) or 2% (consumer debt under the FCJIA, since April 2022).

When a case is litigated in a federal district court sitting in New York — the Southern District of New York (SDNY), the Eastern District of New York (EDNY), or the Northern or Western Districts — the resulting judgment carries interest under 28 U.S.C. § 1961, the federal judgment interest statute.

How the Federal Rate Is Calculated: Under 28 U.S.C. § 1961, post-judgment interest accrues at the weekly average 1-year constant maturity Treasury yield for the calendar week preceding the judgment. This rate is published weekly by the Federal Reserve Board and fluctuates with market conditions.

Why the Federal Rate Is Generally Much Lower: Because the federal rate is tied to Treasury yields rather than set by statute at a fixed percentage, it is typically far below 9%. In 2024 and 2025, the federal rate has ranged between approximately 4% and 5%, compared to New York's 9% commercial rate. For a large judgment, choosing state court over federal court can substantially increase post-judgment interest recovery for plaintiffs.

The FCJIA Does Not Apply to Federal Court Judgments: The Fair Consumer Judgment Interest Act is a New York state statute. Federal courts sitting in diversity apply 28 U.S.C. § 1961 regardless of the nature of the debt. A federal court judgment for consumer debt in New York does not carry 2% under the FCJIA — it carries the federal Treasury-based rate.

Practical Implication: Creditors who obtain federal judgments against New York debtors and then attempt to domesticate those judgments in New York state court for enforcement purposes must use the federal interest rate for the period the judgment was a federal judgment, switching to the CPLR rate only after domestication if applicable.

New York vs California vs Maryland: How JI Rates Compare

New York's dual-rate system makes direct comparisons to other states more complex than a single number, but the broad picture is informative.

New York (CPLR § 5004): - General rate: 9% per year (fixed by statute) - Consumer debt vs natural persons: 2% per year (since April 30, 2022) - Type: Simple interest - Start: Judgment entry date (CPLR § 5003)

California (CCP § 685.010): - Rate: 10% per year (fixed by statute) - Applies uniformly — no consumer/commercial split - Type: Simple interest - California's Constitution caps prejudgment interest; the post-judgment rate is set by statute

Maryland (Md. Code, Courts & Judicial Proceedings § 11-107): - Rate: 10% per year (fixed by statute) - Applies uniformly to most civil judgments - Type: Simple interest

Virginia (Va. Code § 6.2-302): - Rate: Adjustable — set by the State Corporation Commission - Typically ranges from 6% to 8%

Illinois (735 ILCS 5/2-1303): - Rate: 9% per year on most judgments - Similar to New York's general rate, but no consumer debt split

Washington (RCW 4.56.110): - Rate: Adjustable — tied to a formula based on the Federal Reserve discount rate plus 2%

Comparison on $50,000 Judgment, 2 Years:

New York (commercial, 9%): $9,000 interest, $59,000 total New York (consumer, 2%): $2,000 interest, $52,000 total California (10%): $10,000 interest, $60,000 total Maryland (10%): $10,000 interest, $60,000 total Illinois (9%): $9,000 interest, $59,000 total

Key Takeaway: New York's 9% commercial rate is competitive with other major states. But New York is unusual in having a two-tier system — the 2% consumer rate is among the lowest fixed post-judgment rates in the country and represents a substantial protection for individual debtors facing collection judgments.

Sources: CPLR § 5004 (legislature.ny.gov) | Fair Consumer Judgment Interest Act (nyleg.gov)