Debt Management License
The management of debt is a growing industry. State regulators have responded by expanding debt management licensure requirements or creating new license requirements for debt management companies. The debt management licensing process is often a hurdle for a company’s growth into new states. Let the experts at LicenseLogix be your guide through the complex process of becoming licensed.
Debt Management Companies help debtors by creating plans to reduce debts over a fixed period to manage overwhelming debt. These companies also negotiate with creditors to establish reduced rates for their clients. They are paid fees by the debtor in return for their services. Through licensure, the state aims to protect consumers from being taken advantage by fraudulent companies. Due to the vulnerable position of debtors and the ability for a debt management company to manipulate the debtor, many states have opted for license requirements.
Before a debt management company begins working in a new state, they must first be fully licensed in that state. The company will likely need to be foreign qualified by registering the business entity with the Secretary of State. The debt management licensure process can include a lengthy application, background check, proof of accreditation, fingerprints, bonds and exams. The company will likely have to provide proof that they are licensed in their home state as a debt management company or that their home state does not require a license. The process can take up to 3-4 months. Every application is different and all regulatory agencies reserve the right to request further information from the applicant.
Ramifications of Non-Compliance
Debt management companies operating without a valid license will incur severe consequences ranging from cease and desist orders, large penalty fines, to even potential jail time. Debt management companies will also likely have to fully reimburse any of the consumers in the state that they service while unlicensed.
How we help your business:
- Simplifying complex licensure requirements.
- Managing the license project with research, preparation of forms and filing of the final application.
- Tracking all licenses in your portfolio so you never miss a renewal.
- Facts for Debt Management Consumers
- Association of Credit and Collection Professionals
CHOOSE A STATE BELOW FOR SPECIFIC BUSINESS LICENSING INFORMATION:
AL AK AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS
MT NC ND NE NH NJ NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WI WV WY