Calculate the deadline first
New York gives a defendant a different number of days to respond depending on whether they were served personally in state, served by another method, or served on an out-of-state basis. Count from the correct triggering event, not from the day the papers happened to reach you. If the deadline is close, a stipulation extending your time to answer is routine and usually granted between counsel.
What goes in the answer
Respond to every numbered paragraph: admit, deny, or deny knowledge or information sufficient to form a belief. Then plead your affirmative defenses — payment, release, statute of limitations, lack of personal jurisdiction, failure to state a claim, arbitration agreement, unconscionability, improper venue, and any others the facts support. Defenses omitted from the answer can be lost permanently.
Counterclaims and third-party claims
If the plaintiff owes you money or damaged you in the same transaction, plead a counterclaim rather than starting a separate suit. If someone else is responsible for the plaintiff's loss, consider a third-party claim. Both change the settlement dynamic significantly, because the plaintiff can no longer walk away by simply discontinuing.
Answer or move to dismiss?
A pre-answer motion to dismiss can end a defective case early, but it also delays discovery and telegraphs your theory. Reserve it for real defects — no personal jurisdiction, documentary evidence that flatly defeats the claim, an expired limitations period, or a complaint that fails to state a cause of action. Otherwise answer, preserve everything, and fight with the facts.