Bill > S2559

This bill establishes the Debt Collection Fairness Act, which provides comprehensive protections for consumers in debt collection proceedings. The bill defines key terms like consumer debt, creditor, and debt collector, and introduces several significant consumer protections. These include limiting wage garnishment to ensure consumers retain at least 90% of their weekly earnings or a minimum amount based on federal and state minimum wage laws, allowing consumers to seek additional exemptions for financial hardship, and preventing employers from taking adverse employment actions due to garnishments. The bill also establishes a 5-year statute of limitations for debt collection actions, prohibiting lawsuits or legal proceedings on debts after this period, and prevents payments made after the limitations period from reviving the debt. Additionally, the bill caps interest rates on consumer debt judgments at 12% (or 3% for renewals), limits attorney's fees to 15% of the debt amount, and prohibits imprisonment for failure to pay consumer debts. The bill includes provisions to prevent creditors from waiving these protections and treats violations as unfair trade practices. The new law will take effect on January 1, 2026, with some transitional provisions for existing debts and contracts.

Budget and Finance

https://malegislature.gov/Bills/194/S2559