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Nevada has tightened its debt collection regulations under Senate Bill 276, impacting how collection agencies and debt buyers operate. Key changes include mandatory licensing for debt buyers, strict rules on time-barred debts, and clearer exemptions for certain entities like banks and attorneys. Licensing applications require fees, a compliance manager, and adherence to bond and security obligations. Statutes of limitations are strictly enforced - six years for written contracts and four years for medical or open accounts. Agencies must also follow strict consumer protection rules, banning deceptive practices, harassment, and unauthorized charges. These updates aim to ensure fair practices and compliance across the industry.
Nevada Debt Collection Licensing Requirements and Fees Breakdown
If you're involved in debt collection in Nevada, securing a license from the Commissioner of Financial Institutions is a must. This rule applies whether your agency is physically located in Nevada, operates out-of-state but collects from Nevada residents, or collects on behalf of a Nevada-based business.
Applications are processed through the Nationwide Multistate Licensing System and Registry (NMLS). You'll need to complete Form MU-1 for your main office and appoint a certified compliance manager using Form MU-4. The associated fees include a $375 nonrefundable application fee, a $300 initial license fee, and an annual renewal fee of $375. Licenses expire each year on December 31. These steps establish the foundation for compliance and operational standards.
Nevada law (NRS 649.020) defines "collection agency" broadly, encompassing debt buyers who collect on their own accounts. However, there are exemptions. For example:
Additionally, debt buyers can share a single license with an affiliated entity, as long as the affiliate's sole activity is purchasing claims. These exemptions help clarify which entities must adhere to Nevada's licensing requirements.
Beyond licensing, collection agencies must meet specific bond and security requirements. Under NRS 649.105, agencies are required to post a surety bond, with the amount determined by the Commissioner based on factors like risk and collection volume. Agencies must also maintain a principal office within the U.S., even when remote work setups are allowed.
Each licensed agency must appoint a compliance manager with a valid certificate. This individual must dedicate most of their work hours to compliance oversight and have at least two years of experience in collections. The compliance manager certificate costs $190, with an additional $115 investigation fee, and requires an annual renewal fee of $30. Officers and directors are prohibited from holding positions if they have felony convictions related to fraud, collection practices, or moral turpitude. All applicants, including officers, must also complete fingerprint-based background checks.
Recent changes under Senate Bill 276 have reshaped Nevada's debt collection framework. For instance, the law now clearly includes debt buyers under the definition of a collection agency. Additionally, agencies no longer need separate licenses for branch offices - only the main office requires licensing.
Debt buyers enjoy a specific exception regarding trust accounts: if they exclusively collect on purchased claims (and not for third-party clients), they are exempt from maintaining a Nevada-based trust account and providing audited financial statements under NRS 649.355. However, traditional collection agencies working for third-party clients must adhere to these requirements.
The Commissioner also conducts annual trust account examinations, and agencies are required to retain account records for at least six years after the last transaction. Late payment penalties include a 10% fee, with an additional 1% per month for overdue payments.
Nevada's statute of limitations determines how long creditors have to take legal action to collect a debt. According to NRS 649.375, once this period expires, filing a civil lawsuit is no longer allowed, even though the debt itself remains valid.
The statute of limitations varies depending on the type of debt. For example, written contracts, including credit card agreements, have a 6-year limit under NRS 11.190. Even though many credit card accounts are open-ended, they still fall under this rule. Hospital and medical debts, on the other hand, have a shorter 4-year limit under NRS 11.2095. Similarly, open accounts and lease agreements also have a 4-year limit. Domestic and foreign judgments are enforceable for up to 6 years.
| Debt Type | Statute of Limitations | Relevant Statute |
|---|---|---|
| Written Contract | 6 Years | NRS 11.190 |
| Credit Card Debt | 6 Years | NRS 11.190 |
| Hospital/Medical Debt | 4 Years | NRS 11.2095 |
| Open Accounts | 4 Years | - |
| Lease Agreements | 4 Years | - |
| Domestic/Foreign Judgments | 6 Years | - |
These time limits directly impact how contracts are structured and how interest is calculated.
Written contracts can affect both the duration of the collection period and the applicable interest rates. For instance, while open-ended accounts generally have a 4-year statute of limitations, a signed agreement or written application can extend this to 6 years. Nevada law, under NRS 99.040 and NRS 17.130, allows parties to agree on any interest rate. If no rate is specified, creditors can charge the prime rate at Nevada's largest bank plus 2%. Additionally, late fees of up to 5% of the overdue balance per month are permitted when outlined in the contract.
The statute of limitations can reset under specific conditions, such as partial payments, written acknowledgments, or new written promises. However, verbal promises do not qualify. The clock starts from the date of the last missed payment or the date of breach specified in the contract.
Nevada law imposes strict documentation requirements for collecting credit card debt. Under NRS 97A.160, creditors must prove the cardholder’s liability by providing the original written application or evidence of charges incurred and payments made on the account. Acceptable documentation includes photocopies of billing statements or records stored electronically, on microfilm, microfiche, or optical disc.
To authenticate these records, standard court procedures or a written affidavit from the custodian of records must be used. For debt buyers, complaints must include the original issuer’s name, the last four digits of the original account number, any subsequent account numbers assigned by assignees, and the specific date of default, as required by NRS 97A.165. Without this information, courts cannot issue a judgment, even a default judgment. Additionally, debt issuers are required to keep records for at least 24 months after publication or filing. Maintaining accurate records ensures compliance with Nevada’s regulatory guidelines.
Nevada law ensures that certain assets remain out of reach for creditors during debt collection efforts. While collectors can seek repayment, these exemptions safeguard essential resources, allowing debtors to maintain basic necessities for daily life.
Nevada enforces strict rules against deceptive and abusive collection tactics. According to NRS 649.375, debt collectors are prohibited from using notices or demands that mimic legal or government documents. For instance, collection letters cannot be designed to resemble court summonses or official government paperwork. Agencies are also barred from using public shaming tactics, such as advertising claims for sale or publishing debtor lists.
Harassment at the workplace is another area Nevada law addresses. Collectors cannot repeatedly contact a debtor's employer or disclose debt-related details to coworkers or supervisors. Furthermore, adding fees or interest that aren’t explicitly authorized by the original contract or law is prohibited unless those charges are applied by the creditor before the account is sent to collections or are disclosed in the first communication.
Collectors are also restricted from pursuing lawsuits on debts where the statute of limitations has expired. If they know - or should reasonably know - that the debt is time-barred, initiating legal action is unlawful. Additionally, violations of the federal Fair Debt Collection Practices Act (FDCPA) are automatically considered violations of Nevada law, offering consumers dual protection under both federal and state regulations.
For medical debts, collectors must notify debtors before taking any collection action, warning that any payment could acknowledge the debt and potentially waive statute of limitations defenses. Agencies are also forbidden from using fictitious names unless those names are officially registered with the Commissioner of Financial Institutions.
| Prohibited Practice | Specific Restriction |
|---|---|
| Deceptive Legal Process | Simulating court orders, summons, or government notices |
| Unauthorized Charges | Adding fees not permitted by contract or law |
| Employer Harassment | Pressuring or repeatedly contacting a debtor’s workplace |
| Public Shaming | Publishing debtor lists or advertising debts for sale |
| Time-Barred Litigation | Suing on debts past the statute of limitations |
| Data Misuse | Selling personal information from resolved claims |
These laws set the foundation for the regulated processes of repossession and foreclosure, which are explored further below.
Repossession and foreclosure practices in Nevada are subject to strict oversight to avoid conflicts of interest. For example, community managers who handle HOA lien foreclosures must be licensed as collection agencies under NRS 649.020. This applies when they engage in any activities related to foreclosing liens under NRS 116.31162 to 116.31168 or NRS 116B.635 to 116B.660.
"Collection agency includes: (a) A community manager while engaged in the management of a common-interest community... if the community manager... performs or offers to perform any act associated with the foreclosure of a lien." - Nevada Revised Statutes
Mortgage servicers licensed under NRS 645F are generally exempt unless they are pursuing claims already in default. Additionally, collection agencies cannot recover fees for tow car operators if the agency has ties - through ownership, operation, or family affiliation - to the tow operator. This rule helps to eliminate conflicts of interest where agencies might profit from both towing and debt recovery efforts.
Debexpert ensures that anyone involved in Nevada debt transactions verifies their licensing status before accessing its portfolio trading features. The platform connects with the Nationwide Multistate Licensing System and Registry (NMLS), which Nevada relies on to manage collection agency and debt buyer licenses. As part of the registration process, users submit their NMLS unique identifier, which Debexpert cross-checks with records from Nevada's Financial Institutions Division.
Under Nevada's updated regulations, maintaining an active license is mandatory for all entities participating in debt trading. Additionally, each licensed entity must appoint a compliance manager who meets specific criteria: they must be at least 21 years old and have at least two years of full-time experience, with one year of that experience occurring within the 18 months prior to the application. Once licensing is verified, Debexpert supports ongoing compliance through its advanced portfolio analytics.
After confirming licensing, Debexpert uses its analytics tools to help participants stay compliant with Nevada's regulations. These tools flag potential issues, such as credit card debts older than six years and medical debts older than four years. They also monitor surety bond levels, which must range between $35,000 and $60,000 depending on the average monthly trust account balances. Additionally, the platform filters out "resolved claims" from auction listings, aligning with laws that prohibit the sale of resolved claims or associated personal information.
Debexpert goes beyond analytics by offering secure tools for transactions and communication, designed to meet Nevada's strict data integrity and regulatory standards. Its encrypted file-sharing system supports compliance with state rules for remote work and data security. For instance, collection agencies allowing remote work must implement formal information security plans and ensure agents cannot print or store physical records at home. To meet these needs, Debexpert provides view-only access to sensitive debtor data, ensuring information remains centralized and protected.
When it comes to bulk debt transfers, the platform helps manage and verify the necessary written consents from both customers and the Commissioner of Financial Institutions. Auction participants communicate through end-to-end encrypted channels, and Debexpert maintains detailed audit trails of file access to satisfy Nevada's confidentiality requirements.
This section brings together key obligations and actionable steps to help you stay aligned with Nevada's debt collection laws, as outlined in Nevada Revised Statutes Chapter 649.
Nevada's regulations impose similar responsibilities on both collection agencies and debt buyers, with only slight differences in how they operate. Here's a summary of the main requirements:
| Requirement | Collection Agency | Debt Buyer | NRS Citation | Penalties for Violation |
|---|---|---|---|---|
| Licensing | Required for principal place of business | Required; can share license with affiliates | NRS 649.075 | Administrative fines and potential license revocation |
| Compliance Manager | Must designate a certified manager (age 21+, three years experience) | Must designate a certified manager (age 21+, three years experience) | NRS 649.305 | Administrative fines and potential license revocation |
| Bonding | $35,000–$60,000 based on trust account balance | $35,000–$60,000 based on trust account balance | NRS 649.105 | Administrative fines and potential license revocation |
| Record Retention | 6 years after last transaction | 6 years after last transaction | NRS 649.335 | Administrative fines and potential license revocation |
| Remote Call Recording | 3-year retention for all remote calls | 3-year retention for all remote calls | NRS 649.313 | Administrative fines and potential license revocation |
| Annual Reporting | Required to Commissioner and Registry | Required to Commissioner and Registry | NRS 649.345 | Administrative fines and potential license revocation |
Violations under NRS 649.395 and 649.440 can result in administrative fines or even license revocation. Additionally, the Commissioner of Financial Institutions conducts annual examinations of trust accounts and debtor records for all licensed agencies, making consistent compliance a top priority.
To meet these obligations, here are some practical steps you can take:
Nevada's debt collection laws establish a clear framework to ensure that only qualified agencies - whether traditional collectors or debt portfolio managers - can operate within the state. Understanding these requirements is critical for staying compliant and operating lawfully.
The passage of Senate Bill 276 in 2023 marked a significant update by holding debt buyers to the same licensing standards as traditional collection agencies. These changes build on existing licensing and bonding rules, emphasizing accountability. Additionally, Nevada's strict statutes of limitations further define what constitutes lawful debt collection practices.
For instance, the law sets a four-year limit for open accounts and a six-year limit for written contracts. Attempting to sue on debts that exceed these limits is explicitly prohibited under NRS 649.375, with violators facing fines or even license revocation.
These measures work together to promote compliance while ensuring fair and ethical operations. By focusing on secure trust account management, reliable remote work practices, and honest communication, Nevada reinforces its dedication to preventing abusive collection practices. This clear regulatory environment not only protects consumers but also helps agencies maintain the value of their debt portfolios and operate more effectively in the long run.
If you're a debt buyer or run a collection agency in Nevada, you are required to have a Nevada collection license - even if your business is located out of state. Recent legislation mandates that debt buyers secure a collection agency license to operate within Nevada's borders.
In Nevada, the clock on the statute of limitations for a debt can reset under certain conditions. If the debtor makes a payment or provides written acknowledgment of the debt, the time frame for legal action to collect that debt starts over.
To file a lawsuit over credit card debt in Nevada, the creditor must first verify the debt. This involves obtaining - or at least making a reasonable effort to obtain - documents that confirm the debt, provided these documents are not already in the collection agency's possession. Once acquired, the creditor is required to mail the document to the debtor, as outlined in NRS 649.332.
More than a decade of Ivan's career has been dedicated to Finance, Banking and Digital Solutions. From these three areas, the idea of a fintech solution called Debepxert was born. He started his career in Big Four consulting and continued in the industry, working as a CFO for publicly traded and digital companies. Ivan came into the debt industry in 2019, when company Debexpert started its first operations. Over the past few years the company, following his lead, has become a technological leader in the US, opened its offices in 10 countries and achieved a record level of sales - 700 debt portfolios per year.
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