Amendment ID: S2409-1

Amendment 1

Collection Action Consumer Protections

Mr. Tarr moves to amend the bill by striking out all after the enacting clause and inserting in place thereof the following text:-

"SECTION 1. Section 24 of chapter 93, as appearing in the 2012 Official Edition, is hereby amended to insert the following definition:

"Collection action" means a lawsuit or arbitration proceeding initiated to collect a debt from a consumer.

SECTION 2. Chapter 93, as so appearing, is hereby amended by inserting after section 24K the following section 24L:

Section 24L. Collection Action

(a) A debt collector may not enter into a payment schedule or settlement agreement with a consumer regarding a debt without the payment schedule or settlement agreement being documented in open court, approved by the court and included in a court order, or otherwise reduced to writing. If a payment schedule or settlement agreement is not included in a court order, the debt collector shall provide a written copy of the payment schedule or settlement agreement to the consumer within 10 business days of entering into the payment schedule or agreement. A consumer is not required to make a payment on a payment schedule or settlement agreement until the written copy has been provided in accordance with this subsection.

(b) A debt collector may not initiate a collection action when the debt collector knows or reasonably should know that the collection action is barred by the limitations period as set forth in section 2 of chapter 260.

(c)  A debt collector may not commence a collection action more than six years after the date of the consumer’s last activity on the debt. This limitations period applies notwithstanding any other applicable statute of limitations, unless a shorter limitations period is provided under the laws of the Commonwealth.  Notwithstanding any other provision of law, when the applicable limitations period expires, any subsequent payment toward, written or oral affirmation of or other activity on, such debt does not revive or extend the limitations period.

SECTION 3. This Act shall take effect on January 1, 2017."