Alert

August 14, 2017

Oregon Passes Law Regulating Debt Buyers

On August 2, 2017, Oregon Governor Kate Brown signed into law House Bill 2356, a comprehensive piece of legislation that will, for the first time, regulate debt buyers in Oregon. Oregon already regulates "debt collectors" under Or. Rev. Stat. ยง 646.639, but HB 2356 imposes certain additional requirements on debt collectors as well. Specifically, HB 2356 imposes the following requirements on debt buyers and debt collectors:

  • A debt buyer must include specific information relating to the debt in collection lawsuit pleadings, and a court may not enter a judgment for the debt buyer if it does not include the required information;
  • A debt buyer or a debt collector may not file a lawsuit against a debtor if the debt buyer knows, or has reason to know, that the applicable statute of limitations has expired;
  • A debt buyer or a debt collector may not attempt to collect a debt from a debtor unless it has certain business records that establish the nature and amount of the debt;
  • A debt buyer or a debt collector must provide certain information and documentation to a debtor upon request, and cannot collect the debt until it does so; and
  • A debt buyer must obtain a license from the Oregon Department of Consumer and Business Services to engage in debt buying.

HB 2356 defines "debt buyer" as a person that regularly engages in the business of purchasing "charged-off debt" (debt that a creditor treats as a loss or expense and not as an asset) for the purpose of collecting the charged-off debt, or hiring another person to collect or bring legal action to collect the charged-off debt. "Debt buyer" does not include a person that acquires charged-off debt as an incidental part of acquiring a portfolio of debt that is predominantly not charged-off debt.

HB 2356 also revises the definition of "debt collector" in ORS 646.639 to clarify that it includes any person collecting debt owed to a creditor (which includes a person that, in the ordinary course of her business, engages in consumer transactions that result in a consumer owing debt to the person) or a debt buyer.

The law becomes effective October 6, 2017.

  HB 2356