Senator Lewis and State Senate Act to Protect Consumers and Make Debt Collections Fairer

BOSTON—State Senator Jason Lewis joined his colleagues in the Massachusetts Senate to unanimously pass legislation to protect consumers and help keep people from being pushed into financial ruin if they are sued for financial debt. The new law would make debt collection practices fairer, protect wages, and make clear that no person can go to prison for their debt.

The Debt Collection Fairness Act would protect thousands of families across the state, including many in communities of color, by reducing the interest rate from 12% to 3% on judgments on consumer debt, which is often old debt that has been bought by debt collection companies for pennies on the dollar.

It would also protect at least $975 in wages per week from a person subject to wage garnishment because of a debt and ensure that no one in the Commonwealth is imprisoned for failure to pay a consumer debt. Currently only $750 per week in wages is protected from garnishment. The bill would also reduce, from 6 years to 5 years, the time in which a company can bring suit to collect a consumer debt.

“Exploitative debt collection practices have been used for too long to harm low- and middle-income families, especially people of color,” said State Senator Jason Lewis. “The Debt Collection Fairness Act creates much-needed safeguards to protect working families from exorbitant charges by debt collection companies and open paths to recovery for those in financial distress.”

The bill now heads to the Massachusetts House of Representatives for their consideration.