Understanding Kansas Debt Collection Laws: Know Your Rights

Kansas Debt Collection Laws Overview

At its core, Kansas debt collection laws are designed to ensure that debt collection activities are fair to all parties involved in a collection scenario. Although there is significant overlap with federal debt collection practices, Kansas has its own set of regulations that govern how creditors, auto lenders, student loan providers and other commercial entities may attempt to collect debts. The purpose of the state debt collection law is to create a legal framework that protects consumers from aggressive (and possibly illegal) debt recovery strategies, but it also ensures that creditors have the right tools to collect money owed to them.
The most important difference between Kansas debt collection law and similar federal legislation is that the state lacks a version of the Fair Debt Collection Practices Act (FDCPA) in the Kansas Statutes; the federal legislation restricts the use of aggressive strategies by "third-party" debt collectors, or those who collect debts on behalf of others. In contrast , Kansas does not restrict third-party debt collectors from engaging in certain activities such as contacting a debtor at any time day or night.
On the consumer protection side, Kansas debt collection law provides consumers with certain rights that limit aggressive tactics by creditors. For instance, a creditor may not make threats of violence or criminal activity to intimidate a debtor into submitting to the debt collection process.
The two sides of the coin – consumer protection on one hand, creditor protection on the other – are rather common in state and federal debt collection laws. Both federal and Kansas legislation restrict and regulate the activities of creditors and debt collectors, although the federal FDCPA is much stricter than any Kansas law currently on the books. The precise protocols that must be followed under debt collection law, whether in Kansas or federally, depend on the type of debt collection activity being performed:

Consumer Rights Under Kansas Debt Collection Laws

Kansas law affords consumers certain rights when dealing with debt collectors that address the abusive and aggressive collection tactics many face in the state. Under the Kansas Consumer Protection Act, debt collectors are prohibited from using threatening or profane language or engaging in harassment. Collectors must clearly identify themselves and state the reason for the debt call. Consumers may pursue legal remedies if they believe a collector has harassed them at work, used threats of violence or obscene language, or divulged information pertaining to the debt without express consent.
Like the FDCPA, the Kansas Fair Debt Collection Practices Act (KFDCPA), K.S.A. 50-627 et seq., prohibits debt collectors from a variety of extralegal collection practices. For example, it forbids the following: Kansas law enforcement officials take KFDCPA violations seriously. The state Office of the attorney general investigates KFDCPA violations, and the county or district attorneys may prosecute KFDCPA actions for up to one year after the due date of the debt. K.S.A. 50-636(a); KSA 50-638. The KDCPA explicitly permits consumers to file private lawsuits for damages. An action must be brought within one year of the violation. K.S.A. 60-513(a)(2). Kansas also has its own version of the Fair Credit Reporting Act. The Kansas Consumer Reporting Act, K.S.A. 50-630, similarly forbids the use of false information on credit reports. Kansas consumers have the right to dispute incorrect information in their credit files. If a consumer’s identity is stolen, he or she may put a fraud alert on his or her credit report to protect against further harm.

Debt Collection Agency Laws

Debt collection agencies must also follow the Kansas Consumer Credit Reporting Act, which requires licensing of those acting as a debt collector. Kansas Administrative Regulation (K.A.R.) 95-5-2b requires a debt collector to register with the state of Kansas as a "consumer collection agency," but is one of the few places where this is codified. Otherwise, the rules are fairly lax as long as the agency doesn’t break the law and properly identifies themselves.
For example, before contacting a consumer, a Kansas debt collector must obtain written permission from the initial creditor if a contract with the initial creditor prohibits the agency from contacting the consumer. At this stage, the agency is not permitted to attempt to collect on the debt itself; they are only allowed to contact the consumer to confirm that they can start to collect the debt.
First, a Kansas debt collector must identify themselves accurately. When initiating a communication with any Kansas consumer, a debt collector is required to disclose the following information:
Second, a Kansas debt collector is required to keep records of every debt collected, including:
Kansas debt collectors must provide this information to consumers upon request.
If a consumer asks for proof of the debt, Kansas law is very clear on what must be provided: a statement that shows the name of the debtor or alleged debtor, the name of the claimant, a statement of the amount claimed to be due, the date the payment became due, and the correct name of the original creditor. It can be sent on paper or an electronic format, but it must be sent to the consumer’s last known address.
Lastly, some Kansas counties have additional regulations that impose post-security legal requirements. For example, in Johnson County, Kansas additional registration with the county is required before a debt collector may do business in the county.

Debt Collection Legal Process

The Right of Collection
Kansas has some unique provisions that allow creditors to obtain a judgment for collection of a debt. However, there are strict rules with which these creditors must comply. This area of the law is called "creditor’s rights" and its chief provision is to accomplish a reliable way to collect what is owed. The principal legal remedies to pursue in this area are a court lawsuit followed by a court judgment. However, small claims courts in Kansas also play an important role in these proceedings. Indeed, small claims courts have a dual nature.
First, a small claims court can be a first step in a legal remedy, where the matter is filed initially in small claims court, with the right to appeal the judge’s decision thereafter. Second, a small claims court can serve as an alternative to a court lawsuit, where there is no appeal from the judge’s decision. The latter is now the more popular method of pursuing collection in a small claims court because costs are significantly lower. The bulk of the small claims matters filed in a small claims court in Kansas are creditor rights’ proceedings.
Although these creditors’ remedies are available in small claims courts, the whole point of these remedies is to skip the headaches involved in filing a lawsuit, if benefits can be obtained by collecting a small debt outside of court.
Further, these remedies also add the advantage of avoiding the cost of an attorney, especially when a creditor is not yet certain that the debt is collectible, or when the fees of an attorney would be greater than the amount owed.
Pursuant to Kansas law, a creditor generally must sue in a judicial district in Kansas where the debtor resides or where he or she does business. The creditor must file a Verified Petition and request a judgment or some other remedy against the debtor. The creditor then must arrange for service upon the debtor of the Verified Petition and summon to appear before the district court to answer the Verified Petition. This gives the debtor his or her day in court to tell his or her side of the story.
After service upon the debtor is completed, and returns are made to the court, the creditor must file a motion for default judgment. If the debtor owes money and does not appear in response to the Verified Petition, the creditor may obtain a judgment in the full amount of the money owed to the creditor . After the judgment is obtained, the creditor may pursue a number of methods to collect on the judgment.
It is also possible to avoid these proceedings entirely by collecting debts in small claims courts, depending on the amount of the debt and whether the creditor is willing to forego appealing a decision of a small claims judge. Small claims court has two advantages.
First, it was established more than a hundred years ago to expedite the resolution of matters involving less than five hundred dollars ($500). Today, courts have moved to $4000 and sometimes higher amounts, which is both a floor and a ceiling. Appeals to district court are still available this way, but are rarely sought except in a few limited cases.
Second, the procedure standing alone is relatively inexpensive and straightforward, requiring no attorneys, and relying upon phonetic first names from the information collected by a court clerk. In addition, Kansas small claims courts allow a creditor to repossess personal property against which a creditor has a lien, and then can determine whether to give the property and the payment for it to a creditor. Moreover, a creditor can get a judgment for money owed to him or her without help of an attorney.
After a creditor obtains a judgment, he or she can seek collection through garnishment of wages or bank accounts, by seeking a levy against the debtor’s property, or by obtaining a writ of execution. The latter allows a creditor to sell property of a debtor to pay the judgment. In many cases, when a creditor obtains a judgment, the most effective way to collect on it is through a wage garnishment. However, some creditors will seek to garnish wages and bank accounts or to seize specific pieces of property, like cars and trucks.
The above described procedures are some of the most widely used in the state.
The legal remedies are designed to work hand-in-hand with each other. For example, when there is a likely violation of the law, one can sue a creditor to recover damages and obtain a judgment under the consumer protection act.
Ultimately, the process is designed to allow a creditor to pursue collection of a Kansas debt so that the creditor can receive legal protection from the court.

Collection and Garnishment Limits

Kansas law allows creditors to pursue collection of debts through various means. However, these methods are limited by law. The impact on consumers of these limitations is that, although they may be pursued for collection, certain methods cannot be used. For example, while debt collectors may seek garnishment of wages, even if you are not paying your debt in full, as long as the garnishment amount does not exceed the limits set by Kansas law.
Wages may be garnished at a rate of 25 percent of wages after federal garnishments and tax offsets have been taken into account. In other words, once a creditor has obtained a judgment against you and has filed for garnishment, 25 percent of your wages can be garnished. With this limitation, the law sets a limit on the amount creditors can recover from your wages. If you are currently receiving public assistance, the prohibition against garnishments may apply to you.
A judgment creditor or potential judgment creditor can even file a lien against property you possess. However, this can only be done if you normally reside at that address or especially reside in that dwelling. The law protects your individual residence by prohibiting a lien against an individual’s residence.
A lien against your house, a bank account, or other property can lower the value of that property. You can still go about your business and be free to purchase, sell, exchange, or trade that property, even if it is subject to a lien. Besides residential property, other property that can be placed under lien includes:
Whether and how your property may be subject to garnishment or lien are set in statute. If you believe that some third party is exerting control over your property or some third person is garnishing your wages, and you believe that a lien or garnishment is improper, then you have the right to assert that. But time is of the essence since there is a statute of limitations that applies to such improper actions taken by third persons.

Enforcement and Penalties

Enforcement and penalties for those collecting debt in Kansas vary with the type of debt involved. For enforcement of non-priority debts, a debt collector is responsible to the Kansas Attorney General. For enforcement of a consumer debt, the Kansas-legal requirement for bringing an action against the debt collector is that an alleged violation of the Kansas Consumer Protection Act may not have occurred. Otherwise it is up to the Consumer Financial Protection Bureau over a $1,000,000 penalty and up to $1,000 per violation for an Attorney General or private action against the debt collector under the FDCPA. A partnership, corporation, or other legal entity can have civil penalties up to $10,000 and $20,000 for a pattern and practice violation that has been sued upon by the Attorney General. There are three Kansas statutes dealing with the unlawful collection of debt. They are the Uniform Consumer Credit Code, the Kansas Collection Agency Licensing Act, and the Kansas Consumer Protection Act. The Kansas Uniform Consumer Credit Code, starting at K.S.A. 16-1001, with detailed regulations found in 16-1002 et seq., prohibits making false statements in writing. A violation can result in relief from a Kansas court or remedy from the Attorney General including criminal penalties for misdemeanor or felony charges of up to one year and $1,000, according to K . S.A. 21-5114(b). The Kansas Collection Agency Licensing Act, K.S.A. 16-2001 et seq., defines a "collector’s conduct of business" as having the "receiving of payment of dues, installments in the payment of money, interest, premium, or purchase price, principal or, the collection of money, dues, installments, interest, premium, purchase price, or principal regardless of how characterized or whether the debt is liquidated." 16-2001. A collection agency violating these laws can have its license revoked, a civil penalty assessed, be prohibited from engaging in the collection of claims of non-residents of Kansas, or stopped from engaging in "a particular act or practice." K.S.A. 16-2006. The Kansas Consumer Protection Act, K.S.A. 50-623 et seq., protects an interest in non-priority debt and regulates consumer debt collection practices in Kansas. It covers basically the same issues as federal law. However, state law is enforced by the Archivist of the United States rather than the CFPB. A private Kansas citizen may bring an action to enforce the Kansas Consumer Protection Act even though a client may not have a viable federal claim. The Kansas Consumer Protection Act allows remedies including injunctions, actual damages, penalties, attorney fees, and costs. K.S.A. 50-634.