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Debt Collection Laws in Arizona

Sarah Edwards | May 07, 2024

Sarah Edwards
Legal Expert
Sarah Edwards, BS

Sarah Harris is a professional researcher and writer specializing in legal content. An Emerson College alumna, she holds a Bachelor of Science in Communication from the prestigious Boston institution.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: Residents of Arizona can report unlawful debt collectors to the Arizona Attorney General or directly to the Federal Trade Commission. The best way out of your debt is to repay or settle it. SoloSuit can help you validate your debt and request to settle it for a fraction of the original amount.

Are you being hounded by a relentless debt collector? Does the sound of your phone make you cringe? If you’re a resident of Arizona, you have laws that protect you from aggressive collection practices.

Understanding the debt collection laws in Arizona will equip you to deal with debt collectors, and SoloSuit can help you settle your debts and even respond to a debt collection lawsuit.

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Debt collection laws in Arizona

Chances are that your debt collector has purchased an old debt from one of your creditors — usually a bank or credit card company. Now, it might stop at nothing to collect on this debt, even if that means engaging in some shady business tactics.

Thankfully, Arizona residents are protected by the Fair Debt Collection Practices Act (FDCPA), which strictly regulates what debt collectors are allowed to do. For example, debt collectors are not permitted to engage in the following:

  • Calling you more than once per day.
  • Calling you earlier than 8 a.m. or later than 9 p.m.
  • Using threatening or intimidating language, such as threatening you with arrest.
  • Speaking with friends, family, or coworkers regarding your debt.
  • Posting about your debt on social media.
  • Continuing to contact you after receiving a Cease and Desist Letter.
  • Declining to validate your debt.
  • Filing a debt lawsuit after the Statute of Limitations has expired.

While collection agencies are often legitimate, there are also plenty of debt collection scams out there. Learning more about the Statute of Limitations and your rights as a consumer can help you avoid falling prey to scam artists and unscrupulous debt collectors.

Debt collection agencies must be licensed in Arizona

Ariz. Rev. Stat. § 32-1055 states that debt collection agencies must apply for and obtain a license with the Arizona Department of Insurance in order to collect debt in Arizona. This section also explains that debt collectors are prohibited from threatening to sell a debt in order to get a debtor to pay them.

Finally, it also declares that Arizona debt collection agencies must notify the department within ten days of any change of name under which it conducts business. Debt collection agencies frequently change names to make their practices easier, so knowing about this law can help you in standing up for your rights against unruly debt collectors.

Statute of Limitations on debt in Arizona

Debt collectors cannot file a lawsuit to collect a debt once the Statute of Limitations expires. The deadline varies depending on the type of debt you owe. In Arizona, the Statutes of Limitations are as follows:

Statute of Limitations on Debt in Arizona
Debt Type Deadline
Credit Card 6 years
Medical 6 years
Auto Loan 6 years
Student Loan 6 years
Mortgage 6 years
Personal Loan 6 years
Judgment 10 years
Ariz. Rev. Stat. § 12-548 and § 12-1551

Many consumer debts fall under the broad category of “written” debts. This means that credit card debt, personal loans, home equity loans, and other lines of credit have a Statute of Limitations of six years.

The Arizona Predatory Debt Collection Act limits medical debt collectors

Arizona's Predatory Debt Collection Act, officially known as Prop 209, was created and passed in 2022 to protect Arizona families from the severe impacts of medical debt and related aggressive debt collection practices. Here are the key protections that this act would give consumers:

  • Increased Homestead Exemption: It proposes to raise the exemption for home equity protected from creditors to $400,000, adjusted according to the cost of living, to better reflect current home values in Arizona.
  • Protection of Personal Assets: The act would shield up to $5,000 in a bank account, $15,000 in household goods, and vehicles up to $15,000 in value ($25,000 for disabled drivers) from seizure, with these amounts also subject to annual inflation adjustments.
  • Capped Interest Rates on Medical Debt: It aims to limit the interest rate on medical debt to 3%, as many debts grow to unmanageable amounts due to high interest rates.
  • Wage Garnishment Limits: The act would decrease wage garnishment limits to 10%, helping ensure that individuals can maintain basic living standards despite owing debts.

The Predatory Debt Collection Act mostly aims to prevent financial devastation that comes from debts that arise from medical emergencies. Prominent Arizona organization, such as Healthcare Rising Arizona, support the act, which specifically emphasizes protection against losing homes, vehicles, and essential living funds due to emergency medical debt.

How to report debt collectors in Arizona

If you believe that a debt collection agency has violated the FDCPA of the Predatory Debt Collection Act, you can report the violator to the Arizona Attorney General’s Office. Use the online form for consumer complaints or ask for help at the following numbers:

  • In Phoenix: 602-542-5763.
  • In Tucson: 520-626-6504.
  • Outside Phoenix or Tucson: 800-352-8431.

You can also report FDCPA violations to the Federal Trade Commission (FTC) through the FTC website or by calling 877-382-4357. Finally, you can report violations to the Consumer Financial Protection Bureau online or by calling 855-411-2372.

How to respond to debt collectors in Arizona

Now that you understand your rights, you’re better equipped to handle debt collectors who may be calling you regarding your debt. Here’s what to do — and what not to do — the next time your phone rings.

Learn more from Arizona consumer debt attorney, John Skiba, in the following video:

Do not agree to pay the debt without checking the statute of limitations

Debt collectors may pressure you to create a payment plan or make your first payment as a sign of good faith. Think hard about your next steps before you do that. You could unwittingly reset the Statute of Limitations on your debt.

For instance, if your debt is five years old and you make a payment, your debt collector now has six more years to reclaim the remaining balance.

You can settle your debt by going through a few additional steps — and you’ll likely be able to settle your debt for a reduced amount.

Let SoloSuit help you draft a Debt Validation Letter to confirm your debt.

Send a Debt Validation Letter

Your debt collector must identify themselves and provide you with contact details so you can send a Debt Validation Letter. This is a written request for details about the original debt, including the identity of the creditor, the amount owed, and other relevant information.

Learn more about how to create a Debt Validation Letter through this video.

Send a Cease and Desist Letter

You also have the right to send a Cease and Desist Letter. Once your debt collector receives this letter, the law prohibits them from contacting you further.

But be cautious. Sending a Cease and Desist Letter may give you temporary peace of mind, but it could expose you to a lawsuit if you lose track of your debt.

Settle your debt

The surest way to get debt collectors off your back is by paying what you owe. But if you go about this wisely, you can usually settle your debt for a steep discount.

In a debt settlement, you offer your creditor a portion of the total amount due, usually at least 60% of the debt’s value. In exchange for a lump-sum payment, the creditor agrees to drop its legal claims against you and release you from the remaining balance.

A creditor often considers negotiating a debt settlement if you promise to make a lump-sum payment and clear the remaining amount within a short period. Because of this, debt settlement usually works best if you have some cash saved or expect to receive some money soon

Settling your debt helps you avoid a judgment and wage garnishment. You’ll save some money and move on from this challenging experience.

If you decide to settle your obligation, you’ll want to ensure you get the terms of your agreement in writing and pay the creditor before your court date. If you’ve never tried debt settlement before, consider working with a professional organization that will guide you through the process.

To learn more about how to settle a debt in Arizona, check out this video:

SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with the collector. Once an agreement is reached, we’ll help you manage the settlement documentation and transfer your payment to the creditor or debt collector, helping you keep your financial information private and secure.

Now, let’s look at an example of how debt settlement in Arizona works:

Example: Mark has been drowning in credit card debt, and eventually, LVNV Funding sued him for nearly $4,000. After responding to the lawsuit with the help of SoloSuit, Mark used SoloSettle to offer a settlement that worked with his current budget. In the end, he was able to settle his debt for only 65% of the original amount and is now on his way to rebuilding his credit.


What is SoloSuit?

SoloSuit makes it easy to fight debt collectors.

You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.

SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)

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Guides on arbitration

If the thought of going to court stresses you out, you’re not alone. Many Americans who are sued for credit card debt utilize a Motion to Compel Arbitration to push their case out of court and into arbitration.

Below are some resources on how to use an arbitration clause to your advantage and win a debt lawsuit.

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Do you keep getting calls from an unknown number, only to realize that it’s a debt collector on the other line? If you’ve been called by any of the following numbers, chances are you have collectors coming after you, and we’ll tell you how to stop them.

Federal debt collection laws can protect you

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Get debt relief in your state

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Debt collection laws in all 50 states

Debt collection laws vary by state, so we have compiled a guide to each state’s debt collection laws to make it easier for you to stand up for your rights—no matter where you live.

Statute of limitations on debt state guides

Like all debt collection laws, the statute of limitations on debt varies by state. So, we wrote a guide on each state’s statutes. Check it out below.

Statute of Limitations on Debt Collection by State (Best Guide)

Check the status of your court case

Don’t have time to go to your local courthouse to check the status of your case? We’ve created a guide on how to check the status of your case in every state, complete with online search tools and court directories.

How to stop wage garnishment in your state

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Other wage garnishment resources

How to settle a debt in your state

Debt settlement is one of the most effective ways to resolve a debt and save money. We’ve created a guide on how to settle your debt in all 50 states. Find out how to settle in your state with a simple click and explore other debt settlement resources below.

How to settle with every debt collector

Not sure how to negotiate a debt settlement with a debt collector? We are creating guides to help you know how to start the settlement conversation and increase your chances of coming to an agreement with every debt collector.

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Personal loan and debt relief reviews

We give a factual review of the following debt consolidation, debt settlement, and loan organizations and companies to help you make an informed decision before you take on a debt.

How to repair and improve your credit score

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How to resolve student loan debt

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Civil law legal definitions

You can represent yourself in court. Save yourself the time and cost of finding an attorney, and use the following resources to understand legal definitions better and how they may apply to your case.

Get answers to these FAQs on debt collection

How-to debt guides

Learn more with these additional debt resources

Not sued yet?

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