Colorado debt collection laws

How long can someone sue you over a debt in Colorado?

Six years for a debt of a fixed or calculable amount. Section 13-80-103.5 of the Colorado Revised Statutes covers “All actions to recover a liquidated debt or an unliquidated, determinable amount of money due to the person bringing the action”.

Three years for other contract claims. Section 13-80-101 covers “All contract actions, including personal contracts and actions under the ‘Uniform Commercial Code’, except as otherwise provided in section 13-80-103.5”. Which of the two applies to a particular account turns on whether the amount owed is fixed or can be worked out, and that is a question for a lawyer, not this page.

The clock starts when the debt falls due, and for an open account at the last item: “A cause of action for balance due on an open account for goods or services shall accrue at the time of the last item of goods or services proved in such account.” (Section 13-80-108).

A promise to pay only restarts the clock if it is written and signed. Section 13-80-113 says “No acknowledgment or promise shall be evidence of a new or continuing contract sufficient to take a case out of the operation of the statute of limitations, unless it is in writing signed by the party to be charged; but this section shall not alter the effect of a payment of principal or interest.” The section does not say what a payment does, and this page does not cover it. One joint debtor’s acknowledgment, promise or payment does not by itself take away another joint debtor’s protection under these time limits (Section 13-80-114).

A court judgment has its own time limits. A judgment of a Colorado court of record can generally be enforced “at any time within twenty years from the entry thereof, but not afterwards, unless revived as provided by law”, and county court judgments entered since July 1, 1981 for six years (Section 13-52-102).

Sources: Colorado Revised Statutes Sections 13-80-101, 13-80-103.5, 13-80-108, 13-80-113, 13-80-114 and 13-52-102 · quoted 5 November 2026

Do debt collectors have to be licensed in Colorado?

Yes. Section 5-16-118 of the Colorado Fair Debt Collection Practices Act says: “Any person acting as a collection agency must possess a valid license issued by the administrator in accordance with this article 16 and any rules adopted pursuant thereto.” The administrator is “the administrator of the ‘Uniform Consumer Credit Code’, articles 1 to 9 of this title 5, whose office is created in the department of law” (Section 5-16-103), so the license comes from the Colorado Department of Law.

One license covers the main office: “A collection agency must obtain a license for its principal place of business, but its branch offices, if any, need not obtain separate licenses.” Branches must be reported within thirty days of opening (Section 5-16-119). An applicant must be owned by, or employ as collections manager or an executive officer, someone with at least two years in a responsible position at an established collection agency (the administrator may accept comparable business experience instead), and must employ a collections manager responsible for the debt collectors in that office (Section 5-16-119). Renewal is by application in the form the administrator sets (Section 5-16-121); the Department’s page says every license runs to the following July 1 and must be renewed by July 1 each year, and lists a $500 investigation fee and $1,500 for a license and for each renewal.

Some changes of ownership need a new license application, among them a change of fifty percent or more of a company’s stock or ownership interest (Section 5-16-122), so a company can hold a new license number after a sale. It is unlawful to run a collection agency without a license, or under any name other than the licensed one (Section 5-16-115).

Sources: Colorado Revised Statutes Sections 5-16-103, 5-16-115, 5-16-118, 5-16-119, 5-16-121 and 5-16-122 · quoted 5 November 2026 · fees and deadline: Colorado Department of Law, Collection Agency Licensing, read 3 October 2026

Who is covered, and who is exempt?

A collection agency is a business whose main purpose is collecting debts, or anyone who “Regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another”, takes debts by assignment to collect them, or solicits debts to collect (Section 5-16-103). Collectors outside Colorado are covered when they collect from Colorado residents for a Colorado creditor, regularly collect from Colorado residents for a creditor elsewhere, or solicit debts from a Colorado creditor (Section 5-16-102).

Only consumer debts count: “‘Debt’ does not include a debt for business, investment, commercial, or agricultural purposes or a debt incurred by a business.”

Some collectors are not collection agencies at all, among them “Any officer or employee of a creditor while, in the name of the creditor, collecting debts for such creditor”, government staff on official duty, process servers, debt management providers that comply with, or are exempt from, the Uniform Debt-Management Services Act, fiduciaries and escrow agents, and anyone collecting a debt that was not in default when they obtained it. A creditor that collects its own debts under a name suggesting a third party is collecting them is a collection agency.

Two groups are collection agencies but exempt from the licensing rules only. Section 5-16-103 says such a person “shall be exempt from provisions of this article 16 that concern licensing and licensees” if it “Is an attorney-at-law and regularly engages in the collection or attempted collection of debts in this state”, or is an out-of-state collector collecting only debts not incurred in Colorado, by interstate communications such as mail, phone or fax, from a state that licenses collection agencies but does not require a license of Colorado agencies collecting there in the same limited way.

Sources: Colorado Revised Statutes Sections 5-16-102 and 5-16-103 · quoted 5 November 2026

Are debt buyers covered in Colorado?

Yes, expressly: “Debt buyers are collection agencies for the purposes of this article 16.” (Section 5-16-103). The rule reaches debts sold from 2018: “This article 16 applies to debt buyers with respect to consumer debts sold or resold on or after January 1, 2018.” (Section 5-16-134.5).

A collector suing on a debt that a debt buyer owns must attach the documents showing who owns it. Section 5-16-111 says that if the debt was assigned more than once, “each assignment or other writing evidencing transfer of ownership must be attached to establish an unbroken chain of ownership”, along with the original agreement or the substitutes the section lists.

Sources: Colorado Revised Statutes Sections 5-16-103, 5-16-111 and 5-16-134.5 · quoted 5 November 2026

Does a Colorado collection agency need a bond?

Yes, with the license, unless it is a debt buyer collecting only its own debts. Section 5-16-124 requires “a bond in the sum of twelve thousand dollars plus an additional two thousand dollars for each ten thousand dollars or part thereof by which the average monthly sums remitted or owed to all of its clients during the previous year exceed fifteen thousand dollars”, or a savings account, deposit or certificate of deposit of the same sum instead, and “The total amount of the bond shall not exceed twenty thousand dollars”. The bond is “in favor of the attorney general of the state of Colorado for use of the people of the state of Colorado and the administrator”.

If the surety cancels or reduces the bond and no new or increased bond is filed within thirty days after the administrator receives its notice (or a later date the surety’s notice gives), the license “shall automatically expire”. The state’s register records the license, not the bond, which is why this site describes Colorado agencies as licensed.

Source: Colorado Revised Statutes Section 5-16-124 · quoted 5 November 2026

What may a Colorado collector do?

When it may contact you. Unless it knows otherwise, “a debt collector or collection agency shall assume that the convenient time for communicating with a consumer is after 8 a.m. and before 9 p.m. local time at the consumer’s location”. If it knows you have a lawyer for the debt and can readily find the lawyer’s name and address, it must deal with the lawyer, unless the lawyer does not respond in a reasonable time or agrees to direct contact, and it may not contact you at work if it knows or has reason to know your employer forbids it (Section 5-16-105).

Asking it to stop. If you write refusing to pay or asking it to stop, “the debt collector or collection agency shall not communicate further with the consumer with respect to the debt, except to:” say it is ending its efforts, or give notice of a specific remedy. A collection agency’s first letter must tell you so: “A consumer has the right to request in writing that a debt collector or collection agency cease further communication with the consumer.” The same statement says a written request to stop does not prevent other action the law allows to collect the debt. The same letter must give the Attorney General’s web address in set wording (Section 5-16-105).

Fees and interest. A collector may not add “any amount, including any interest, fee, charge, or expense incidental to the principal obligation, unless the amount is expressly authorized by the agreement creating the debt or permitted by law” (Section 5-16-108). Without an agreement or another law setting a different rate, interest runs at eight percent a year, compounded annually (Section 5-12-101).

Credit reports, postcards and envelopes. A collector may not report a debt (other than a check, a negotiable instrument or a credit card draft) to a credit bureau earlier than thirty days after the first notice was mailed, unless your last known address is known to be invalid, may not write to you by postcard, and may put nothing on the envelope but its address, or a business name that does not show it collects debts (Section 5-16-108).

The validation notice. Within five days of first contact, unless the first contact already gave it or the debt is paid, the collector must send the amount, the creditor’s name and your right to dispute within thirty days. A written dispute sent within those thirty days stops collection of the debt, or the disputed part, until the collector mails verification or a copy of a judgment, and “The failure of a consumer to dispute the validity of a debt under this section shall not be construed by any court as an admission of liability by the consumer.” (Section 5-16-109).

Sources: Colorado Revised Statutes Sections 5-12-101, 5-16-105, 5-16-108 and 5-16-109 · quoted 5 November 2026

What are the rules on medical debt in Colorado?

On request, a medical debt collector must stop and itemize: “Upon written request by the consumer and without fee to the consumer, a debt collector or collection agency collecting on a medical debt shall cease collection until it can provide an itemized statement to the consumer after the request is received.” (Section 5-16-109).

A payment plan of four or more installments must be put in writing: the collector “shall provide a written copy of the payment plan to the consumer within seven days after entering into the payment plan”. While a health insurance appeal is pending, or was pending in the last 63 days, a collector that knows or should know of it may not report the debt, contact you to collect it unless you ask, sue, or “Sell the medical debt to a debt buyer.” (Section 5-16-109.5).

Interest is capped: “The maximum rate of interest on medical debt is three percent per annum.” (Section 5-12-102). And until July 1, 2028, credit bureaus may not report “Any adverse item of information that the consumer reporting agency knows or should know concerns medical debt”, except for very large credit transactions (Section 5-18-109). For hospital bills, Section 6-20-203 adds its own limits on extraordinary collection actions.

Sources: Colorado Revised Statutes Sections 5-12-102, 5-16-109, 5-16-109.5 and 5-18-109 · Section 6-20-203 · quoted 5 November 2026

When a collector sues you

In most cases a collector must sue where you signed the contract or where you live. Section 5-16-111 says it must bring the action “only in the judicial district or similar legal entity in which” “The consumer signed the contract sued upon” or “The consumer resides at the commencement of the action”, with separate rules for a suit over real property and for some child support actions. If the debt belongs to a debt buyer, the chain of ownership must be attached, as above.

If a court gives judgment, what can be taken from your pay and property is limited; the Colorado wage garnishment page quotes the limits and the exempt property. Trying to collect more than those laws allow is itself an unfair practice under Section 5-16-108.

Sources: Colorado Revised Statutes Sections 5-16-108 and 5-16-111 · quoted 5 November 2026

Complaints and penalties

The Department of Law must look into a written complaint: “Upon filing with the administrator by any interested person a written complaint charging any person with a violation of this article 16, any rule adopted pursuant to this article 16, or any lawful order of the administrator, the administrator shall conduct an investigation.” (Section 5-16-127). Complaints go through the Attorney General’s File a Complaint page, under Credit and Debt.

The administrator may issue letters of admonition, deny, suspend or revoke a license, place a licensee on probation, or “impose administrative fines in an amount up to one thousand five hundred dollars per violation” (Section 5-16-127). A consumer can also sue a collector that breaks the act, for actual damages and “additional damages as the court may allow, but not to exceed one thousand dollars” in an individual case, with costs and reasonable attorney fees if the case succeeds (Section 5-16-113). The suit must be filed within one year of the violation (Section 5-16-113).

The act itself has an end date: “This article 16 is repealed, effective September 1, 2028.” (Section 5-16-135), which also schedules a review of the act before that date.

Sources: Colorado Revised Statutes Sections 5-16-113, 5-16-127 and 5-16-135 · quoted 5 November 2026

How do you check a Colorado collector?

Search the Colorado Department of Law’s public license reports. Each record shows the license number, its status and its start date. Licenses that are no longer Active stay on the register, with the register’s own word for their status (Surrendered, Expired, Cancelled or Withdrawn). Look for a license recorded as Active; the Department says a license stays in force while a renewal that has been submitted is decided, so a license shown as Expired since the last July 1 is worth checking with the Department. A company can hold a newer number after a change of ownership. An attorney, or a business collecting only business debts, can be lawfully absent. Our step-by-step guide covers the traps, and this directory’s Colorado page lists agencies as they pass verification against the register.