Massachusetts Debt Collection Laws: Your Rights

You have strong protections under Massachusetts debt collection laws. The state prohibits unfair and deceptive collection practices. Debt collectors must follow strict rules or face legal consequences.

Understanding these laws helps you defend yourself against aggressive collectors. You can use violations as legal defenses in court.

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How Debt Collection Works in Massachusetts

Four types of entities can legally collect debt from you:

Creditor

Your original lender who gave you credit. Banks and credit unions fall into this category. Creditors don’t need licenses but must follow Attorney General regulations.

Debt Collector

Third-party agents who collect on behalf of creditors. They must obtain licenses through the Division of Banks. Each employee needs proper registration to collect in Massachusetts.

Attorney

Lawyers collecting debt for creditors. They already have professional licenses to practice. Attorneys must follow Supreme Judicial Court Rules, Attorney General regulations, and the Fair Debt Collection Practices Act.

Debt Buyer

Companies that purchase delinquent debts from original creditors. They own the debt outright, so no license is required. However, they must still follow all federal and state collection laws.

Key Massachusetts Debt Collection Laws

Several state laws protect you from unfair treatment. These regulations apply to all collectors, including original creditors.

Collectors Must Have Valid Licenses

Massachusetts law requires debt collectors to obtain licenses before collecting. The Division of Banks issues these licenses after thorough review. Collection agencies pay thousands in fees and bonding requirements.

Third-party loan servicers must also register with the state. Banks and original creditors are exempt from this requirement.

Unlicensed collection is illegal in Massachusetts. You can challenge collection attempts from unlicensed agencies.

Prohibited Collection Practices

Massachusetts law bans unfair, deceptive, and unreasonable collection tactics. Here’s what collectors cannot do:

Discuss your debt with anyone except you or your attorney
Contact you after learning you have legal representation
Call before 8 a.m. or after 9 p.m.
Contact you more than twice per week about a debt
Call your workplace more than twice in 30 days
Use threatening or offensive language
Threaten actions they cannot legally take
Pretend to be government officials or law enforcement
Send documents that look like court papers

If a collector violates these rules, you have grounds for a legal complaint. Report violations to the Consumer Financial Protection Bureau or Massachusetts Attorney General.

When dealing with debt collection lawsuits, our partner Solo can help you respond properly and protect your rights.

Property Exempt From Collection

Massachusetts protects certain property from seizure. Collectors cannot take these items to satisfy debts:

Necessary clothing and bedding
Household furniture up to $15,000 in value
One computer and one television
Work tools up to $5,000 in value
One vehicle needed for work, up to $7,500 wholesale value
Home utilities like stoves, refrigerators, and heaters
Books up to $500 in value
Food and provisions up to $600 for your family
Burial plots and tombstones
Cash or savings up to $2,500
Jewelry for personal use up to $1,225
Personal property up to $1,000, plus unused exemption amounts

These exemptions protect your basic necessities. You cannot lose your essential possessions to debt collection.

Wage Garnishment Limits

Collectors can garnish wages only after obtaining a court judgment. Even then, Massachusetts law limits how much they can take.

Garnishment is capped at the lesser of:

15% of your gross wages before deductions
Disposable income minus 50 times the hourly minimum wage

Put simply, collectors must leave you with 85% of your wages. Alternatively, they must leave you with 50 times minimum wage per week.

You can object to garnishment by filing a claim of exemption. Request a court hearing to challenge the wage attachment.

Additional Attorney General Regulations

The Massachusetts Attorney General has established additional standards. These rules define what counts as harassment or deception.

Collectors violate regulations when they:

Call without identifying themselves properly
Contact you directly after you hire an attorney
Continue calling your workplace after you request they stop
Call outside normal hours without your consent
Threaten arrest, imprisonment, or other impossible actions
Visit your home repeatedly at inappropriate times

Written requests to stop workplace calls remain valid indefinitely. Oral requests expire after ten days. Always put your requests in writing.

Massachusetts Statute of Limitations on Debt

Collectors have limited time to sue you for unpaid debt. The statute of limitations sets this deadline.

In Massachusetts, the limit is six years for most consumer debts. This includes credit cards, personal loans, and written contracts.

The clock starts when you miss your first payment. After six years of no payments, collectors cannot sue you.

However, judgments last 20 years in Massachusetts. Once a collector wins a judgment, they have two decades to collect. The debt also accrues 12% annual interest during this period.

Never ignore a lawsuit just because the debt is old. You must still respond if sued within the six-year window.

Consequences of Ignoring Collectors

Ignoring debt collectors leads to serious problems. Collectors can and will sue you for unpaid debts.

You have 20 days to respond after receiving a summons. This includes weekends and holidays. If the 20th day falls on a weekend, you get until the next business day.

Missing this deadline results in a default judgment. The collector automatically wins without you presenting any defense.

After winning judgment, collectors can:

Garnish up to 25% of your wages
Place liens on your property
Seize and sell non-exempt assets

Many collectors make mistakes when filing liens. They often lack proper documentation to prove debt ownership. You can challenge these errors, but only if you respond to the lawsuit.

How to Respond to a Debt Lawsuit

Responding to a lawsuit protects your rights and assets. You need to file a written Answer with the court.

Your Answer must accomplish three things:

Respond to each claim in the complaint
Assert your affirmative defenses
Get filed with the court and served on the plaintiff

You don’t need a lawyer to file an Answer. The process is straightforward with the right guidance.

In your Answer, you can raise defenses like:

Statute of limitations has expired
Debt amount is incorrect
You already paid the debt
The collector lacks proper documentation
The collector violated Massachusetts collection laws

File your Answer before the 20-day deadline. Missing this deadline costs you the case automatically.

Our partner Solo provides a simple web application to draft your Answer. The service asks you questions and generates your legal response. An attorney reviews your document before filing.

Settling Your Debt

You can often settle debt for less than the full amount. Collectors buy old debts for pennies on the dollar. They’re willing to accept reduced payments.

Settlement negotiations work best when you:

Respond to the lawsuit first
Know your rights under Massachusetts law
Have documentation of the original debt
Can make a lump sum payment

Never admit the debt is valid during negotiations. Always request validation of the debt amount first. Many collectors cannot prove they own your debt.

Get any settlement agreement in writing before paying. The agreement should state the debt will be satisfied in full.

Your Rights Are Enforceable

Massachusetts gives you powerful tools against abusive collectors. These aren’t just suggestions for collectors to follow. They’re enforceable laws with real consequences.

You can sue collectors who violate these laws. Successful lawsuits can result in damages and attorney fees. Violations also provide strong defenses in collection lawsuits.

Document every interaction with debt collectors. Save letters, record call dates and times, and note what was said. This evidence becomes crucial if you need to prove violations.

Don’t let unlicensed or abusive collectors intimidate you. Stand up for your rights under Massachusetts law.

Frequently Asked Questions

What is the statute of limitations on debt in Massachusetts?

The statute of limitations is six years for most consumer debts in Massachusetts, including credit cards and personal loans. After six years of no payments, collectors cannot sue you. However, if a collector already has a judgment, they have 20 years to collect.

How do I respond to a debt collection lawsuit in Massachusetts?

You must file a written Answer within 20 days of receiving the summons. Your Answer should respond to each claim, assert your defenses, and be filed with the court. You can draft and file an Answer without hiring a lawyer using online tools.

Can debt collectors garnish my wages in Massachusetts?

Collectors can garnish wages only after winning a court judgment. Massachusetts limits garnishment to the lesser of 15% of gross wages or disposable income minus 50 times the minimum wage. You can object by filing a claim of exemption and requesting a hearing.

What property is protected from debt collectors in Massachusetts?

Massachusetts exempts essential property including household furniture up to $15,000, one vehicle up to $7,500 for work, necessary clothing, home utilities, work tools up to $5,000, and cash or savings up to $2,500. Collectors cannot seize these items.

Can debt collectors call me at work in Massachusetts?

Debt collectors can call your workplace, but they cannot contact you more than twice in 30 days at work. If you request in writing that they stop calling your workplace, they must honor your request. Written requests remain valid indefinitely.

Massachusetts Debt Collection Laws: Know Your Rights