Harder Votes to Protect Servicemembers, Businesses, Students & More from Debt Collectors

May 13, 2021
Press Release

WASHINGTON — Today, Representative Josh Harder (CA-10) voted to pass the Comprehensive Debt Collection Improvement Act, which will provide important protections for Central Valley servicemembers, small businesses, students, and others against mistreatment and harassment by debt collectors. Importantly, this bill specifically bars debt collectors from threatening to reduce the rank or revoke the security clearance of American men and women in uniform.


“While our businesses, families, servicemembers, and students have suffered over the past year, the biggest debt collection agencies in the country have made record profits. That’s just plain wrong,” said Rep. Harder. “This bill will be a huge help for anyone facing harassment or mistreatment because of outstanding debt, especially the men and women serving our nation in uniform.”


This legislation will:


  • Protect servicemembers;
    • Prohibits debt collectors from threatening a servicemember with reducing their rank, revoking their security clearance, or prosecuting them under the Uniform Code of Military Justice.
    • Requires a Government Accountability Office (GAO) study on the impact of debt collection on servicemembers.
  • Protect small and minority-owned businesses;
    • Codifies protections that currently exist under a Federal Trade Commission (FTC) regulation for consumer loans prohibiting the use of “confessions of judgment” that waive due process protections, and extends those protections to commercial loans to protect small and minority-owned businesses.
  • Protect private student loan borrowers with disabilities;
    • Requires discharge of private student loans for both the borrower and cosigner in the case of permanent disability of the borrower, extending protections that currently exist for federal student loan borrowers.
    • Requires private lenders who are notified that the federal government has discharged the federal student loans of a borrower to discharge the private student loans of that same borrower.
  • Protect consumers with medical debt;
    • Bars entities from collecting medical debt or reporting it to a consumer reporting agency without giving a consumer notice about their rights.
    • Provides a minimum one-year delay before adverse information is reported and a two-year delay before collection attempts are made, starting from the date the first payment is due.
    • Bans the reporting of medical debt arising from medically necessary procedures.
  • Protect consumers against debt collection harassment;
    • Prohibits a debt collector from contacting a consumer by email or text message without a consumer’s consent to be contacted electronically.
    • Requires the Consumer Financial Protection Bureau (CFPB) to analyze and annually report on the impact of electronic communications utilized by debt collectors.


Read the full text of the bill here.