Senate Acts to Protect Consumers from Predatory Debt Collection
(BOSTON—7/17/2025) Today, the Massachusetts Senate unanimously passed the Debt Collection Fairness Act to protect consumers and 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 be imprisoned for unpaid consumer debt.
The legislation, S.2537, would strengthen consumer protections to ensure that individuals can retain some financial security when they are sued for debts that are frequently old and potentially bought by debt collection companies for pennies on the dollar.
The bill would protect thousands of families across Massachusetts—including many in communities of color—by reducing the interest rate on consumer debt from 12 per cent to 3 per cent, exempting most wages and child support from garnishment, and establishing a five-year statute of limitations for legal claims.
The bill also prohibits employers from penalizing employees due to wage garnishment or personal debt, and adds further protections for individuals coping with financial hardship.
“For years, our debt collection system has operated with too few safeguards for consumers. This landmark legislation safeguards working families from wage garnishment that can push people to the brink, caps runaway interest rates, and ends unfair surprises in our courts,” said Senator Adam Gómez (D-Springfield). “By updating our laws for transparency, fairness, and enforcement, we’re ensuring dignity and economic security for every consumer in the Commonwealth.”
“Families already in the grip of debt should not have to choose between putting food on the table and paying the exorbitant costs charged by debt collection companies—or fear imprisonment,” said Senate President Karen E. Spilka (D-Ashland). “It is a story we hear too often, and far too often in our communities of color. An equitable Commonwealth is one where we have people’s backs, and I’m proud that the Senate is taking action today to do just that. I am also thankful to Chair Rodrigues, Chair Feeney, and Senator Eldridge for their work.”
“I’m pleased the Senate has passed this commonsense consumer protection measure,” said Senator Michael J. Rodrigues (D-Westport), Chair of the Senate Committee on Ways and Means. “This long overdue legislation will protect individuals from being pushed over a financial cliff due to unsavory debt collectors who prey upon people experiencing financial hardship, with marginalized communities often being disproportionally affected. It’s more important than ever for the Commonwealth to stand up and protect these basic consumer rights in the wake of protections disappearing at the federal level. I thank Chair Feeney, Senator Eldridge, and Senate President Spilka for their determined effort to bring this important legislation to the Senate floor for passage.”
“Those caught in the grip of a debt cycle know all too well the often-predatory practices used by debt collectors, and the crippling reality of staring down a ballooning debt that seems insurmountable,” said Senator Paul Feeney, Chair of the Joint Committee on Financial Services (D-Foxborough). “While the Debt Collection Fairness Act will not eliminate debt or an obligation to pay, the bill does provide a lifeline and opportunity for hope for those caught in the deepest depths of this spiral so that families have some room to breathe, to move forward and break this debilitating cycle. I am grateful to Senator Jamie Eldridge for championing this and for his strong advocacy, the many stakeholders and advocates who brought this bill forward, and for the leadership of Chair Michael Rodrigues and Senate President Karen Spilka for their commitment to empowering working people and protecting our constituents from shady practices.”
“President Trump is dismantling federal government agencies dedicated to protecting consumers,” said Senator Jamie Eldridge (D-Marlborough), primary sponsor of the legislation. “Here in Massachusetts, I am proud that the state Senate is voting on my bill—the Debt Collection Fairness Act—to provide protections from the predatory practices of debt collectors for working class families. I’d like to thank Senate President Karen E. Spilka, Senate Ways and Means Committee Chair Michael J. Rodrigues, and Financial Services Senate Committee Chair Paul R. Feeney for their steadfast support for this bill.”
The legislation was reported out of the Joint Committee on Financial Services on June 20, 2025, and from the Senate Committee on Ways and Means on July 10, 2025. Votes of both committees are available online, along with a full summary of the legislation and a recording of the Senate’s livestreamed debate and vote on the bill.
Having passed the Senate, the bill now heads to the House of Representatives for consideration.
Statements of Support
“In the face of the Trump Administration's rollback of federal consumer protection efforts, stepping up to protect the economic security of Massachusetts residents is more critical than ever,” said Attorney General Andrea Joy Campbell. “I am proud to co-sponsor this legislation and am grateful to Senator Eldridge for introducing and Chairs Rodrigues and Feeney and shepherding this important legislation, which will provide needed relief to Massachusetts families through common sense reforms that will help break cycles of indebtedness and poverty. I look forward to continuing to work with sponsors Representatives Nguyen and Barber as the legislation moves to the House of Representatives.”
“We are thrilled the Senate passed the Debt Collection Fairness Act,” said Nadine Cohen, former Managing Attorney, Consumer Rights Unit of Greater Boston Legal Services. “This bill will help many low-income families who are struggling to pay off old consumer debt. By reducing the interest rate on judgments and protecting more wages from garnishment many low-wage working families will be able to keep more of their hard earned money for their rent, food and other necessities.”
“This bill would reduce the strain on families already struggling to keep food on the table and pay some of the steepest rents in the country,” said Michael Best, Director of State Advocacy at the National Consumer Law Center. “We are grateful to the legislature for taking action to keep hard-earned wages in the pockets of working people threatened by unscrupulous debt collectors.”
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