5 new state laws in 3 states change how debt collection lawsuits work, by our review of 2025 and 2026 legislation. Washington and Virginia adopted the Uniform Consumer Debt Default Judgments Act, which requires collectors to put basic facts and documents about a debt in the lawsuit before a court can enter a default judgment. Washington's law takes effect January 1, 2027 and Virginia's July 1, 2027.
California enacted two laws on how people are served with lawsuits and how they can undo a default judgment they never knew about, and Virginia passed a second law limiting how long debt buyers can enforce some judgments. Lawmakers in 6 other states filed bills on the same subjects; New York's Legislature passed one in June 2026 that has not yet been sent to the governor.
Why default judgments matter
Most consumer debt lawsuits end in a default judgment because the person sued does not respond, sometimes because they never learned of the case. A judgment can let a creditor garnish wages or freeze a bank account. The new laws focus on the steps before that point: proof that the plaintiff owns the debt and that the amount is right, a clear notice to the consumer, valid service, and time limits on suing and on enforcing judgments.
Enacted laws
| State | Bill | Status (verified) | Last action | What it does (our summary) |
|---|---|---|---|---|
| Washington | SB5720 | Enacted: Chapter 107, Laws of 2026; effective Jan. 1, 2027 | 2026-03-18 | Adopts the Uniform Consumer Debt Default Judgments Act: a court may enter a default judgment in a consumer debt case only if the complaint includes set information about the debt, its owner and the amount claimed, with supporting documents, and a plain-language notice to the consumer. |
| Virginia | HB444 | Enacted: Chapter 395, Acts of 2026; effective July 1, 2027 | 2026-04-08 | Adopts the Uniform Consumer Debt Default Judgments Act, with the same complaint, document and notice requirements before a default judgment. |
| Virginia | HB1426 | Enacted: Chapter 848, Acts of 2026 | 2026-04-13 | For general district court judgments entered on or after July 1, 2026 that a debt buyer seeks to enforce, docketing the judgment in circuit court no longer extends the 10-year period to enforce it. |
| California | AB2042 | Enacted: Chapter 379, Statutes of 2026 | 2026-09-20 | Lets a person sued by a debt buyer ask the court to set aside a default judgment if they did not get actual notice of the case in time, even if service was technically lawful, and adjusts service-of-process rules. |
| California | AB747 | Enacted: Chapter 563, Statutes of 2025; main provisions apply from Jan. 1, 2027 | 2025-10-10 | SPARE Act: sets a three-attempt standard for "reasonable diligence" before substitute service, requires photo and GPS evidence on proofs of service, and shifts the burden of proving service when a defendant challenges a default. Applies to civil cases generally, including debt suits. |
We list a law as enacted only after confirming its chapter number in the enrolled or chaptered text. Effective dates are from the text.
Bills that have not become law
| State | Bill | Status (verified) | Last action | What it does (our summary) |
|---|---|---|---|---|
| California | SB706 | Did not pass (died Feb. 2, 2026) | 2026-02-02 | Would have barred debt buyers from suing more than one year after charge-off and limited sales of charged-off debt. |
| Hawaii | SB3188 | Did not pass (2026 session ended) | 2026-02-02 | Requires collectors to include documentation of the debt in a lawsuit and verify the consumer's address and that the suit is within the time limit; says a payment after the limit does not revive the debt. |
| Massachusetts | H1275 | Replaced by H 4316 | 2025-07-28 | Original House filing. |
| Massachusetts | H4316 | Reported favorably by committee; in House Ways and Means Committee | 2025-07-28 | House version of the same proposal. |
| Massachusetts | S2537 | Replaced by S 2551 | 2025-07-17 | Earlier Senate committee draft. |
| Massachusetts | S2551 | Replaced by S 2559 | 2025-07-17 | Earlier Senate draft of the same proposal. |
| Massachusetts | S2559 | Passed Senate, July 17, 2025; in House Ways and Means Committee | 2025-07-21 | Debt Collection Fairness Act: shortens the time to sue on a consumer debt to five years, bars suits on time-barred debt, limits judgments to 10 years with one renewal, and raises exemptions from wage garnishment and bank account seizures. |
| Massachusetts | S735 | Replaced by S 2537 | 2025-06-23 | Original Senate filing. |
| Michigan | HB6230 | In committee | 2026-08-11 | House version of SB 1137. |
| Michigan | SB1137 | Passed Senate, Sept. 10, 2026; in House committee | 2026-09-15 | Rewrites Michigan's garnishment and execution procedures for collecting judgments, including exemptions for earnings and property. |
| New Jersey | A1415 | In committee | 2026-01-13 | Reintroduced version of A 5619 for 2026-2027. |
| New Jersey | A5619 | Did not pass (2024-2025 session ended) | 2025-05-15 | Says a payment or acknowledgment after the six-year limit does not revive a time-barred consumer debt claim. |
| New Jersey | AR102 | In committee | 2026-01-13 | Reintroduced version of AR 187. |
| New Jersey | AR187 | Did not pass (2024-2025 session ended) | 2025-05-05 | Resolution urging the New Jersey Supreme Court to change court rules to increase transparency in consumer debt lawsuits. |
| New York | A00057 | Passed Assembly, May 28, 2025; in Senate committee | 2025-05-28 | 2025 version of the same proposal. |
| New York | A10182 | Replaced by S 9760 on June 3, 2026 | 2026-06-03 | Assembly version of S 9760. |
| New York | S05546 | In committee | 2025-10-01 | Senate version of A 57. |
| New York | S09760 | Passed Senate (June 2) and Assembly (June 3, 2026); not yet sent to the governor | 2026-06-03 | Consumer Debt Uniformity Act: extends New York's consumer credit lawsuit rules, including its three-year statute of limitations, to "consumer debt" generally, such as medical, rent, utility and tuition debts. |
| Pennsylvania | HB1731 | Reported from House Judiciary Committee as amended, June 17, 2026; laid on the table Sept. 8 | 2026-09-08 | Consumer Debt Collection Fairness Act: requires debt collectors and buyers to include documentation of the debt in the complaint, sets a three-year limit on collection suits, bars default judgments without an affidavit and documents, and requires a notice of rights. |
| Pennsylvania | HB801 | In committee | 2025-03-04 | Adopts the Uniform Consumer Debt Default Judgments Act. |
Status as of October 21, 2026. Some states list several versions of the same proposal; we show each record and note which ones replaced others. "Did not pass" means the session in which the bill was filed has ended.
Federal bill
H.R. 2704, the Fair Debt Collection Improvement Act, would amend the federal Fair Debt Collection Practices Act to bar debt collectors from collecting or trying to collect a debt once the statute of limitations has run. It was referred to the House Financial Services Committee on April 8, 2025 and has not moved since.
What changed in our count
A keyword search of 2025 and 2026 bills for consumer debt and statutes of limitations, time-barred debt or default judgments returned 35 records in 11 states. After reading each bill, we kept 23 records in 9 states that change the rules for lawsuits to collect consumer debt. We dropped 12: four state budget bills whose text has no relevant provision, two bills on court fines, two coerced-debt bills, two hospital medical debt bills, one debt-settlement bill and one technical revision. Broader searches added 3 more: Virginia HB 1426, California SB 706 and the federal H.R. 2704. That gives 25 state records in 9 states, which reflect 14 separate proposals once replaced drafts and companion bills are combined, plus one federal bill. Coerced debt and medical debt bills are covered on separate pages linked below.
What you can do if you are sued over a debt
- Do not ignore the papers. Respond by the deadline on the summons, even if you think you do not owe the debt, or the court may enter a default judgment.
- Check whether the debt is past your state's time limit. Our debt statute of limitations by state guide lists the limits, for example in Washington, Virginia, California and New York. In many states a payment can restart the clock, so get advice before paying on an old debt.
- Ask the plaintiff to prove it owns the debt and how the amount was figured, especially if a debt buyer is suing.
- If a judgment was entered and you never got notice, ask the court about setting it aside. Free legal aid may be available.
Source
Bill status and texts: LegiScan (data licensed under CC BY 4.0, LegiScan LLC), search of 2025 and 2026 sessions, retrieved October 21, 2026, with each bill's latest text read by us. Enacted laws: Washington Laws of 2026, ch. 107 (SSB 5720); Virginia Acts of Assembly 2026, ch. 395 (HB 444) and ch. 848 (HB 1426); California Statutes of 2026, ch. 379 (AB 2042) and Statutes of 2025, ch. 563 (AB 747). New York S 9760 status confirmed on the New York State Assembly bill page. Bill texts are public records. Our table is available under CC BY 4.0. Credit "My Credit Guide (mycreditguide.org)".
Steven Reynolds, "State Laws on Debt Collection Lawsuits, 2025-26," My Credit Guide, October 21, 2026, https://mycreditguide.org/data/debt-collection-lawsuit-laws/.