Bill Introduced in Colorado to Extend Moratorium on ‘Extraordinary’ Collection Actions

The Colorado legislature kicked off its 2021 session yesterday and the second bill that was introduced in the state Senate was a measure to extend the moratorium on “extraordinary” collection actions in the state until June 1.

A copy of the bill, which was introduced by state Senators Faith Winter and Julie Gonzales, and state Representative Leslie Herod — each of whom are Democrats — can be accessed by clicking here.

The limitations currently are set to expire on February 1. An extraordinary collection action is defined as an action in the nature of a garnishment, attachment, levy, or execution to collect or enforce a judgment on a debt as defined under the state’s Fair Debt Collection Practices Act. Should someone take such an action, it would constitute an unfair and unconscionable means of collecting a debt under Colorado’s FDPCA. Under the law, up to $4,000 in a depository account or accounts in the debtor’s name is exempt from levy and sale under a writ of attachment or execution.

Prior to a judgment creditor performing an extraordinary collection action, it must provide a written notice to the individual, to be sent at least 10 days prior to the execution of a writ, notifying the individual that he or she can temporarily suspend the extraordinary collection action if the individual is facing a financial hardship due to COVID-19. The individual is required to notify the creditor about the hardship, but is not required to provide any additional information.

It does appear that the bill does not include any other mechanisms to extend the moratorium past the June 1 date.

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