Arizona Fair Debt Collection Laws

Arizona's fair debt collection laws make it illegal for debt collectors to use deceptive or unfair collection practices.

By , Attorney · George Mason University Law School
Updated by Amy Loftsgordon, Attorney · University of Denver Sturm College of Law

In Arizona, both the federal Fair Debt Collection Practices Act (FDCPA) and state law regulate debt collectors. The FDCPA applies to every state and protects consumers from unfair and deceptive debt collection practices. The FDCPA also prohibits debt collectors from contacting you at certain times and places.

Likewise, Arizona's fair debt collection laws prohibit debt collectors from engaging in a range of deceptive and intrusive tactics when collecting money on behalf of a creditor. Arizona also requires collection agencies to be licensed.

What Are Arizona's Fair Debt Collection Laws?

You can find Arizona's debt collection laws at Ariz. Rev. Stat. §§ 32-1001 to 32-1057.

Who Is Regulated by Arizona's Fair Debt Collection Laws?

Arizona law defines a "collection agency" as someone who is "engaged" in collecting debts, including anyone who collects debts occurring in the operation of the person's own business but collects payments from customers under a different name. (Ariz. Rev. Stat. § 32-1001).

Some parties are exempt from certain parts of the law, like attorneys, banks, real estate brokers, and title companies. (Ariz. Rev. Stat. § 32-1004).

Do You Have to Be Licensed to Collect Debt in Arizona?

Arizona law also requires that collection agencies be licensed and provide a bond. (Ariz. Rev. Stat. § 32-1021, § 32-1055).

What Are the Prohibited Debt Collection Practices Under Arizona Law?

Under Arizona law, collection agencies must "deal openly, fairly, and honestly" in conducting their business. Licensees may not "engage in any unfair or misleading practices." In addition, the law forbids "oppressive, vindictive, or illegal" collection methods. (Ariz. Rev. Stat. § 32-1051).

Arizona law also prohibits the following specific practices, among other things.

  • Sending any written communication that imitates any form of judicial process from a court, government entity, or lawyer.
  • Representing that the debt collector practices law or maintains a legal department unless the collector is, in fact, also licensed to practice law.
  • Attempting to collect any collection fee, attorneys' fee, court costs, or expenses that the debtor is not legally obligated to pay.
  • Threatening to sell the debtor's obligation to any person, firm, or group.
  • Misrepresenting the amount of the existing debt.
  • Falsely stating that if the debt is not paid, the debtor will incur additional attorneys' fees, investigation fees, service fees, or any other additional charge.
  • Giving the impression that the debt collector represents the State of Arizona, the state government, or any state agency or that any of these entities has endorsed its activities. (Ariz. Rev. Stat. § 32-1051).

Also, a debt collector can't attempt to collect any collection fee, attorneys' fee, court cost, or expenses unless the fees, charges, or expenses are justly due from and legally chargeable against the debtor or have been judicially determined. (Ariz. Rev. Stat. § 32-1051).

What Are the Requirements for Debt Collectors Under Arizona Law?

In addition to getting a license and refraining from engaging in prohibited activities, debt collectors must deposit all money collected with a local financial institution and keep that money deposited until remitted to the client. (If the collection agency doesn't have an office in Arizona, the agency may deposit and keep the money in a depository in the state where the company's principal office is located.) (Ariz. Rev. Stat. § 32-1055).

How Do Arizona's Fair Debt Collection Laws Compare to the Federal Fair Debt Collection Practices Act (FDCPA)?

The FDCPA is a federal law that regulates fair debt collection, while state-specific statutes in Arizona give consumers added protections. Arizona's fair debt collection laws incorporate many of the FDCPA's provisions with minor differences, such as specifying that a debt collector can't give the false impression that it represents the State of Arizona.

Also, while Arizona fair debt collection laws are similar to the FDCPA, the Arizona law is a criminal statute. So, unlike the FDCPA, so it doesn't allow individuals to sue collection agencies for violating the law.

What Are the Penalties for Violating Arizona's Fair Debt Collection Laws?

Violation of the Arizona debt collection statute is a class 1 misdemeanor. (Ariz. Rev. Stat. § 32-1056).

How Do You Enforce Arizona's Fair Debt Collection Laws?

You can't directly sue a debt collector for breaking the law. However, any debtor victimized by a collection agency can report a violation of the statute to the local city or county prosecutor. (Ariz. Rev. Stat. § 32-1057).

Also, because the federal FDCPA applies in Arizona, you may sue for money damages under that federal statute (see below).

Filing a Lawsuit for Federal FDCPA Violations

If a debt collector uses abusive or deceptive collection behavior, you might also be able to file a lawsuit under the federal FDCPA. However, be aware that FDCPA violations don't eliminate the debt, nor do they restrict the creditor's options for taking legal action.

Talk to a debt relief lawyer if you need help initiating a lawsuit.

How Can You Get Help With Arizona's Fair Debt Collection Laws?

You can also file a complaint with the Consumer Financial Protection Bureau (CFPB) if you have an issue with an Arizona debt collector. After you submit a complaint, the CFPB will work to get you a response, typically within 15 days.

What Are Your Rights If You're Being Sued by a Debt Collector?

If a debt collector sues you, you have the right to respond in court. You also have the right to hire an attorney to represent you in the case.

Even though you're being sued, you can still try to settle the debt. If the collector violated federal or state laws when trying to collect from you, you could have leverage in debt settlement negotiations.

Read More Articles

Learn what to do if a bill collector uses abusive tactics.

Read about what you should and shouldn't do when a debt collector calls.

Get tips on how to tell the difference between a debt collector and a scammer.

Talk to a Lawyer

Even if a collector violates federal or state law, the debt doesn't disappear. The creditor might still take legal action against you, like filing a lawsuit to collect the debt.

If you think a debt collector or collection agency has violated the federal FDCPA or Arizona state law (particularly if a collections lawsuit has been filed against you), consider talking to an attorney to get advice about your options.

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