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Debt collection terms, defined by state law

By Kai Greenspan, Founding Editor

The same word means different things in different states. A "debt collector" in Texas is any person who engages in debt collection, directly or indirectly; in New York the statute defines it as an individual. A debt buyer is inside the definition of "collection agency" in Illinois, inside "debt collector" in California, and in a section of its own in Texas. This page gives 29 statutory definitions of 18 terms across 5 states, each one the statute's own words, with the section number and a link to the official text. Nothing here is paraphrased.

This page is educational information, quoted from public statutes with sources and dates. It is not legal advice; how a definition applies to a specific debt or company depends on its facts, and a consumer attorney or legal aid service is the right place for advice.

Third-party debt collector

Texas Tex. Fin. Code s. 392.001
"Third-party debt collector" means a debt collector, as defined by 15 U.S.C. Section 1692a(6), but does not include an attorney collecting a debt as an attorney on behalf of and in the name of a client unless the attorney has nonattorney employees who: (A) are regularly engaged to solicit debts for collection; or (B) regularly make contact with debtors for the purpose of collection or adjustment of debts.

Act Texas Finance Code Chapter 392 · Read at source the statute · Confirmed against the live statute · Texas agencies

Debt collector defined differently by state

Texas, Florida, California and New York each define this term, and the texts differ. California defines it twice, once under the Rosenthal Act and once under the Licensing Act. All five texts are below in full, so the difference is visible rather than summarized.

Texas Tex. Fin. Code s. 392.001
"Debt collector" means a person who directly or indirectly engages in debt collection and includes a person who sells or offers to sell forms represented to be a collection system, device, or scheme intended to be used to collect consumer debts.

Act Texas Finance Code Chapter 392 · Read at source the statute · Confirmed against the live statute · Texas agencies

Florida Fla. Stat. s. 559.55
“Debt collector” means any person who uses any instrumentality of commerce within this state, whether initiated from within or outside this state, in any business the principal purpose of which is the collection of debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another. The term “debt collector” includes any creditor who, in the process of collecting her or his own debts, uses any name other than her or his own which would indicate that a third person is collecting or attempting to collect such debts. The term does not include: (a) Any officer or employee of a creditor while, in the name of the creditor, collecting debts for such creditor; (b) Any person while acting as a debt collector for another person, both of whom are related by common ownership or affiliated by corporate control, if the person is acting as a debt collector for persons to whom it is so related or affiliated and if the principal business of such persons is not the collection of debts; (c) Any officer or employee of any federal, state, or local governmental body to the extent that collecting or attempting to collect any debt is in the performance of her or his official duties; (d) Any person while serving or attempting to serve legal process on any other person in connection with the judicial enforcement of any debt; (e) Any not-for-profit organization which, at the request of consumers, performs bona fide consumer credit counseling and assists consumers in the liquidation of their debts by receiving payments from such consumers and distributing such amounts to creditors; or (f) Any person collecting or attempting to collect any debt owed or due or asserted to be owed or due another to the extent that such activity is incidental to a bona fide fiduciary obligation or a bona fide escrow arrangement; concerns a debt which was originated by such person; concerns a debt which was not in default at the time it was obtained by such person; or concerns a debt obtained by such person as a secured party in a commercial credit transaction involving the creditor.

Act Florida Statutes Chapter 559 Part VI · Read at source the statute · Confirmed against the live statute · Florida agencies

California Rosenthal Act Cal. Civ. Code s. 1788.2
“debt collector” means any person who, in the ordinary course of business, regularly, on behalf of that person or others, engages in debt collection. The term includes any person who composes and sells, or offers to compose and sell, forms, letters, and other collection media used or intended to be used for debt collection.

Act Rosenthal Fair Debt Collection Practices Act, Civil Code · Read at source the statute · Confirmed against the live statute · California agencies

California Licensing Act Cal. Fin. Code s. 100002
“Debt collector” means any person who, in the ordinary course of business, regularly, on the person’s own behalf or on behalf of others, engages in debt collection. The term includes any person who composes and sells, or offers to compose and sell, forms, letters and other collection media used or intended to be used for debt collection. The term “debt collector” includes “debt buyer” as defined in Section 1788.50 of the Civil Code.

Act Debt Collection Licensing Act, Financial Code · Read at source the statute · Confirmed against the live statute · California agencies

New York N.Y. Gen. Bus. Law s. 600
"Debt collector" means an individual who, as part of his or her job, regularly collects or attempts to collect debts: (a) owed or due or asserted to be owed or due to another; or (b) obtained by, or assigned to, such person, firm or corporation, that are in default when obtained or acquired by such person, firm or corporation.

Act General Business Law Article 29-H · Read at source the statute · Confirmed against the live statute · New York agencies

Consumer collection agency

Florida Fla. Stat. s. 559.55
“Consumer collection agency” means any debt collector or business entity engaged in the business of soliciting consumer debts for collection or of collecting consumer debts, which debt collector or business is not expressly exempted as set forth in s. 559.553 (3).

Act Florida Statutes Chapter 559 Part VI · Read at source the statute · Confirmed against the live statute · Florida agencies

Collection agency defined differently by state

Illinois and California each define this term, and the texts differ. Both texts are below in full, so the difference is visible rather than summarized.

Illinois 205 ILCS 740/2
"Collection agency" means any person who, in the ordinary course of business, regularly: (1) engages in the business of collection of any debt for others; (2) engages in the business of receiving, by assignment or otherwise, debt from any person who owns or controls 20% or more of the business receiving the assignment with the purpose of collecting moneys due on such debt; (3) sells or attempts to sell, or gives away or attempts to give away to any other person, other than a person licensed under this Act, any system of collection, letters, demand forms, or other printed matter where the name of any person, other than that of the creditor, appears in such a manner as to indicate, directly or indirectly, that a request or demand is being made by any person other than the creditor for the payment of the sum or sums due or asserted to be due; (4) engages in the business of buying debt; (5) engages in the business of using a fictitious name in collecting its own accounts, bills, or debts with the intention of conveying to the debtor that a third party has been employed to make such collection; or (6) engages in the business of collection of a check or other payment that is returned unpaid by the financial institution upon which it is drawn.

Act Illinois Collection Agency Act, 205 ILCS 740 · Read at source the statute · Confirmed against the live statute · Illinois agencies

California Licensing Act Cal. Fin. Code s. 100002
“Collection agency” means a business entity through which a debt collector or an association of debt collectors engage in debt collection.

Act Debt Collection Licensing Act, Financial Code · Read at source the statute · Confirmed against the live statute · California agencies

Debt buyer defined differently by state

Texas and Illinois each define this term, and the texts differ. Both texts are below in full, so the difference is visible rather than summarized.

Texas Tex. Fin. Code s. 392.307
"Debt buyer" means a person who purchases or otherwise acquires a consumer debt from a creditor or other subsequent owner of the consumer debt, regardless of whether the person collects the consumer debt, hires a third party to collect the consumer debt, or hires an attorney to pursue collection litigation in connection with the consumer debt. The term does not include: (A) a person who acquires in-default or charged-off debt that is incidental to the purchase of a portfolio that predominantly consists of consumer debt that has not been charged off; or (B) a check services company that acquires the right to collect on a paper or electronic negotiable instrument, including an Automated Clearing House (ACH) authorization to debit an account that has not been processed.

Act Texas Finance Code Chapter 392 · Read at source the statute · Confirmed against the live statute · Texas agencies

Illinois 205 ILCS 740/2
"Debt buyer" means a person that is engaged in the business of purchasing delinquent or charged-off consumer loans or consumer credit accounts or other delinquent consumer debt for collection purposes, whether it collects the debt itself or hires a third party to collect or hires an attorney-at-law for litigation to collect such debt.

Act Illinois Collection Agency Act, 205 ILCS 740 · Read at source the statute · Confirmed against the live statute · Illinois agencies

Creditor defined differently by state

Texas, Florida and California each define this term, and the texts differ. California defines it twice, once under the Rosenthal Act and once under the Licensing Act. All four texts are below in full, so the difference is visible rather than summarized.

Texas Tex. Fin. Code s. 392.001
"Creditor" means a party, other than a consumer, to a transaction or alleged transaction involving one or more consumers.

Act Texas Finance Code Chapter 392 · Read at source the statute · Confirmed against the live statute · Texas agencies

Florida Fla. Stat. s. 559.55
“Creditor” means any person who offers or extends credit creating a debt or to whom a debt is owed, but does not include any person to the extent that they receive an assignment or transfer of a debt in default solely for the purpose of facilitating collection of such debt for another.

Act Florida Statutes Chapter 559 Part VI · Read at source the statute · Confirmed against the live statute · Florida agencies

California Rosenthal Act Cal. Civ. Code s. 1788.2
“creditor” means a person who extends covered credit to a debtor.

Act Rosenthal Fair Debt Collection Practices Act, Civil Code · Read at source the statute · Confirmed against the live statute · California agencies

California Licensing Act Cal. Fin. Code s. 100002
“Creditor” means a person who extends consumer credit to a debtor.

Act Debt Collection Licensing Act, Financial Code · Read at source the statute · Confirmed against the live statute · California agencies

Debtor defined differently by state

California and New York each define this term, and the texts differ. California defines it twice, once under the Rosenthal Act and once under the Licensing Act. All three texts are below in full, so the difference is visible rather than summarized.

California Rosenthal Act Cal. Civ. Code s. 1788.2
“debtor” means a natural person from whom a debt collector seeks to collect a covered debt that is due and owing or alleged to be due and owing from that person. (2) In relation to a covered commercial debt or covered commercial credit, a “debtor” shall mean a natural person who guarantees an obligation related to a covered commercial credit transaction.

Act Rosenthal Fair Debt Collection Practices Act, Civil Code · Read at source the statute · Confirmed against the live statute · California agencies

California Licensing Act Cal. Fin. Code s. 100002
“Debtor” means a natural person from whom a debt collector seeks to collect a consumer debt that is due or owing or alleged to be due or owing from the person.

Act Debt Collection Licensing Act, Financial Code · Read at source the statute · Confirmed against the live statute · California agencies

New York N.Y. Gen. Bus. Law s. 600
"Debtor" means any natural person who owes or who is asserted to owe a consumer claim.

Act General Business Law Article 29-H · Read at source the statute · Confirmed against the live statute · New York agencies

Consumer debt

Texas Tex. Fin. Code s. 392.001
"Consumer debt" means an obligation, or an alleged obligation, primarily for personal, family, or household purposes and arising from a transaction or alleged transaction.

Act Texas Finance Code Chapter 392 · Read at source the statute · Confirmed against the live statute · Texas agencies

Consumer claim

New York N.Y. Gen. Bus. Law s. 600
"Consumer claim" means any obligation of a natural person for the payment of money or its equivalent which is or is alleged to be in default and which arises out of a transaction wherein credit has been offered or extended to a natural person, and the money, property or service which was the subject of the transaction was primarily for personal, family or household purposes. The term includes an obligation of a natural person who is a co-maker, endorser, guarantor or surety as well as the natural person to whom such credit was originally extended.

Act General Business Law Article 29-H · Read at source the statute · Confirmed against the live statute · New York agencies

Charged-off debt

Texas Tex. Fin. Code s. 392.307
"Charged-off debt" means a consumer debt that a creditor has determined to be a loss or expense to the creditor instead of an asset.

Act Texas Finance Code Chapter 392 · Read at source the statute · Confirmed against the live statute · Texas agencies

Charge-off balance

Illinois 205 ILCS 740/2
"Charge-off balance" means an account principal and other legally collectible costs, expenses, and interest accrued prior to the charge-off date, less any payments or settlement.

Act Illinois Collection Agency Act, 205 ILCS 740 · Read at source the statute · Confirmed against the live statute · Illinois agencies

Current balance

Illinois 205 ILCS 740/2
"Current balance" means the charge-off balance plus any legally collectible costs, expenses, and interest, less any credits or payments.

Act Illinois Collection Agency Act, 205 ILCS 740 · Read at source the statute · Confirmed against the live statute · Illinois agencies

Covered debt

California Rosenthal Act Cal. Civ. Code s. 1788.2
“covered debt” means a consumer debt or a covered commercial debt.

Act Rosenthal Fair Debt Collection Practices Act, Civil Code · Read at source the statute · Confirmed against the live statute · California agencies

Coerced debt

Illinois 205 ILCS 740/2
"Coerced debt" means any debt as defined by this Act or a portion of the debt, except for debt secured by real property, that was incurred by the debtor because of fraud, duress, intimidation, threat, force, coercion, undue influence, or the non-consensual use of the debtor's personal identifying information between family or household members as defined in Section 103 of the Illinois Domestic Violence Act of 1986, as a result of abuse or exploitation as defined in Section 103 of the Illinois Domestic Violence Act of 1986, or due to human trafficking as defined in subsections (b), (c), and (d) of Section 10-9 of the Criminal Code of 2012.

Act Illinois Collection Agency Act, 205 ILCS 740 · Read at source the statute · Confirmed against the live statute · Illinois agencies

Control person

Florida Fla. Stat. s. 559.55
“Control person” means an individual, partnership, corporation, trust, or other organization that possesses the power, directly or indirectly, to direct the management or policies of a company, whether through ownership of securities, by contract, or otherwise. The term includes, but is not limited to: (a) A company’s executive officers, including the president, chief executive officer, chief financial officer, chief operations officer, chief legal officer, chief compliance officer, director, and other individuals having similar status or functions. (b) For a corporation, a shareholder who, directly or indirectly, owns 10 percent or more or that has the power to vote 10 percent or more, of a class of voting securities unless the applicant is a publicly traded company. (c) For a partnership, all general partners and limited or special partners who have contributed 10 percent or more or that have the right to receive, upon dissolution, 10 percent or more of the partnership’s capital. (d) For a trust, each trustee. (e) For a limited liability company, all elected managers and those members who have contributed 10 percent or more or that have the right to receive, upon dissolution, 10 percent or more of the partnership’s capital.

Act Florida Statutes Chapter 559 Part VI · Read at source the statute · Confirmed against the live statute · Florida agencies

Out-of-state consumer debt collector

Florida Fla. Stat. s. 559.55
“Out-of-state consumer debt collector” means any person whose business activities in this state involve both collecting or attempting to collect consumer debt from debtors located in this state by means of interstate communication originating from outside this state and soliciting consumer debt accounts for collection from creditors who have a business presence in this state. For purposes of this subsection, a creditor has a business presence in this state if either the creditor or an affiliate or subsidiary of the creditor has an office in this state.

Act Florida Statutes Chapter 559 Part VI · Read at source the statute · Confirmed against the live statute · Florida agencies

Licensee

California Licensing Act Cal. Fin. Code s. 100002
“Licensee” means a person licensed, conditionally or unconditionally, pursuant to this chapter.

Act Debt Collection Licensing Act, Financial Code · Read at source the statute · Confirmed against the live statute · California agencies

California debtor accounts

California Licensing Act Cal. Fin. Code s. 100002
“California debtor accounts” means accounts that are owned by consumers who reside in California at the time that the consumer makes a payment on the account.

Act Debt Collection Licensing Act, Financial Code · Read at source the statute · Confirmed against the live statute · California agencies

How these quotations are checked

Every definition on this page was cut from a capture of the statute taken at source, and each one has to survive five checks before it can appear: it must be present in the capture word for word, it must not run into the next definition, it must carry none of the host website's own navigation, it must end on a full stop, and it must not end on the number that introduces the following definition. A scheduled job then re-fetches these statutes each month and confirms that every quotation still appears in the live text.

Two limitations are worth stating rather than hiding. The first is that state legislature websites answer some machines and refuse others, in both directions: Florida and Illinois will not answer at all from one location and answer normally from another, while New York does the reverse and returns a page that looks successful but contains no statute. The check therefore runs from two locations, and treats a page without its expected content as a failure rather than a pass, because an HTTP success carrying the wrong body is the way this fails quietly.

The second follows from the first. On September 8, 2026 the Illinois General Assembly's website stopped answering either location, having answered normally the day before, so the five Illinois definitions below were last confirmed against the live statute on September 7, 2026 rather than on the date at the top of this page. Their text has not changed since that confirmation. Being unable to re-check a quotation is not the same as finding it wrong, and it is not the same as confirming it either, which is why it is said here rather than left to the reader to assume.

Not yet on this page: the New York City Administrative Code definition of "debt collection agency" at Section 20-489, which governs the license New York City itself issues. Three routes to an official copy were tried and none produced one from the codifier, so it is recorded as missing rather than quoted from a mirror.

Common questions

Does "debt collector" mean the same thing in every state?

No, and the differences are not cosmetic. Texas defines a debt collector as "a person who directly or indirectly engages in debt collection", which reaches companies. New York’s General Business Law Section 600 defines it as "an individual who, as part of his or her job, regularly collects or attempts to collect debts", which reaches the person doing the collecting rather than the firm; New York City licenses the firm separately, as a "debt collection agency". California defines the term twice, once in the Rosenthal Act for consumer protection and again in the Debt Collection Licensing Act for licensing, and only the licensing version states that "debt collector" includes "debt buyer". Every state definition quoted here is set out in full on this page with its section number.

Is a debt buyer a debt collector?

It depends which state’s statute you are reading, which is exactly why this page exists. California Financial Code Section 100002 states that the term "debt collector" includes "debt buyer" as defined in Section 1788.50 of the Civil Code. Illinois folds it into a different term: its definition of "collection agency" in 205 ILCS 740/2 includes a person who "engages in the business of buying debt". Texas keeps them separate, defining "debt buyer" in its own section, Finance Code Section 392.307, rather than in the general definitions section. Debt Collection Index lists third-party collection agencies only, never debt buyers.

Why does California appear twice for the same term?

Because California passed two different Acts that define the same vocabulary for two different purposes. The Rosenthal Fair Debt Collection Practices Act, at Civil Code Section 1788.2, defines these terms for the conduct rules that protect consumers. The Debt Collection Licensing Act, at Financial Code Section 100002, defines them for who must hold a license from the Department of Financial Protection and Innovation. The wording is close but not identical, and which one applies depends on which question is being asked, so both are shown rather than merged.

How do you know these quotations are still accurate?

Each definition is cut from a statute page captured at source, and a scheduled job re-fetches the statutes from each state’s own website every month and checks that every quotation on this page still appears in it word for word. The sources cannot all be reached from one place: Florida answers a US server and not the other location, New York answers the other location and serves the US server a page with no statute in it, so the check runs from both. As of September 8, 2026 the Illinois website answers neither, so its five definitions carry their last confirmed date, September 7, 2026, and are noted as such on the page rather than counted as current. Twenty-four of the twenty-nine definitions here were confirmed against the live statute on September 8, 2026, with no mismatches found anywhere.

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