The bill amends the existing law regulating collection practices in Michigan, specifically focusing on definitions and the scope of collection agencies. It clarifies the definitions of terms such as "claim," "collection agency," "consumer," "creditor," and "regulated person." Notably, the bill specifies that a "collection agency" includes individuals and entities engaged in collecting debts or repossessing items of value, and it expands the definition to include those who use fictitious names in the collection process. Additionally, the bill introduces a new provision that excludes individuals licensed under the earned wage access services act from being classified as regulated persons in the context of their operations under that act.

The bill also modifies existing language regarding the responsibilities of creditors and the nature of collection activities. It removes the requirement for the assignor of a debt to continue being considered the creditor when a debt is assigned for collection purposes. Furthermore, it clarifies that certain activities performed by claim forwarders or remarketers, such as forwarding repossession assignments and procuring auction services, do not fall under the definition of collection activities, provided they are conducted under a contract with a creditor. The enactment of this bill is contingent upon the passage of House Bill No. 5558.

Statutes affected:
House Introduced Bill: 445.251