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IllinoisHB3352104th General Assembly (2025–2026)HouseWALLET

COLLECTION AGENCY COERCED DEBT

Sponsored By: Kelly M. Cassidy (Democratic)

Became Law

judiciary - civilassignmentsfinancial institutions

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 4 benefits, 1 costs, 0 mixed.

How to challenge coerced debt

You can assert you are not liable for coerced debt by sending a complete written statement with at least one proof, like a police report, court order, or approved third‑party verification. Send it by certified mail, overnight delivery, email plus a mailed hard copy, or an online form if the agency offers one. Within 10 days, the agency must stop pre‑judgment collection and tell credit bureaus the debt is disputed. The agency must finish its review within 90 days. If your statement is incomplete, the agency has 21 days to list what is missing, and you have 21 days to fix it; the agency may restart collection 30 days after that notice if you do not complete it. If you give only oral notice, the agency must tell you within 14 days how to file in writing and must flag the dispute to credit bureaus. The agency may ask who the perpetrator is but cannot share your contact info or a copy of your statement with that person.

Penalties and payments in coerced debt

If a collection agency breaks these coerced‑debt rules, you can recover the greater of your actual loss or up to $2,500 per debt, plus court costs and reasonable attorney fees. If a court finds someone coerced the debt, that person must repay the unpaid debt to the agency and pay you for your actual damages, like payments or garnishments you suffered. A qualified third party who lies in a verification is liable to the agency for actual damages, court costs, and attorney fees.

Stronger court defenses and privacy

In any debt lawsuit or arbitration, you can raise an affirmative defense by filing a complete coerced‑debt statement with the agency and the court or arbitrator. Then the collection agency must prove the debt is not coerced by a preponderance of the evidence. Judges and arbitrators must protect your safety and privacy, including sealing records, redacting personal details, and using remote hearings when needed. Any contract term that tries to waive these rights is void. The statute of limitations pauses while the agency is barred from suing, and the clock starts again when the pause ends.

Clear definitions and state forms

The law defines coerced debt to include debts from fraud, force, threats, misuse of a household member’s ID, domestic abuse, or human trafficking. It excludes debt secured by real property. Within 180 days after the law’s effective date, the Department must publish a model coerced‑debt statement and a model third‑party verification form in English and other languages. The forms include the required attestation and follow Section 1‑109 verification rules. Publishing these forms is not rulemaking.

One pre-suit try with each agency

If the agency sends a good faith written decision that the debt is not coerced, you cannot file another coerced‑debt statement on that same debt with that agency before any lawsuit or arbitration starts. The agency does not have to answer repeat filings during that time.

Sponsors & Cosponsors

Sponsor

  • Kelly M. Cassidy

    Democratic • House

Cosponsors

  • Adriane Johnson

    Democratic • Senate

  • Amy Briel

    Democratic • House

  • Camille Y. Lilly

    Democratic • House

  • Celina Villanueva

    Democratic • Senate

  • Christopher Belt

    Democratic • Senate

  • Dagmara Avelar

    Democratic • House

  • Diane Blair-Sherlock

    Democratic • House

  • Graciela Guzmán

    Democratic • Senate

  • Hoan Huynh

    Democratic • House

  • Jehan Gordon-Booth

    Democratic • House

  • Jennifer Gong-Gershowitz

    Democratic • House

  • Joyce Mason

    Democratic • House

  • Justin Slaughter

    Democratic • House

  • Karina Villa

    Democratic • Senate

  • Kevin John Olickal

    Democratic • House

  • Kimberly A. Lightford

    Democratic • Senate

  • Mary Edly-Allen

    Democratic • Senate

  • Maura Hirschauer

    Democratic • House

  • Nabeela Syed

    Democratic • House

  • Nicolle Grasse

    Democratic • House

  • Rachel Ventura

    Democratic • Senate

  • Rita Mayfield

    Democratic • House

  • Robert Peters

    Democratic • Senate

  • Stephanie A. Kifowit

    Democratic • House

  • Steve Stadelman

    Democratic • Senate

  • Sue Rezin

    Republican • Senate

  • Thaddeus Jones

    Democratic • House

  • Theresa Mah

    Democratic • House

  • Willie Preston

    Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 186 • No: 30

Senate vote • 5/22/2025

Third Reading - Passed;

Yes: 56 • No: 0

Senate vote • 5/7/2025

Do Pass Financial Institutions;

Yes: 8 • No: 0

House vote • 4/10/2025

Third Reading - Short Debate - Passed

Yes: 89 • No: 23

House vote • 4/9/2025

House Floor Amendment No. 1 Recommends Be Adopted Judiciary - Civil Committee;

Yes: 20 • No: 0

House vote • 3/19/2025

Do Pass / Short Debate Judiciary - Civil Committee;

Yes: 13 • No: 7

Actions Timeline

  1. Public Act . . . . . . . . . 104-0297

    8/15/2025House

  2. Effective Date January 1, 2026

    8/15/2025House

  3. Governor Approved

    8/15/2025House

  4. Added as Alternate Co-Sponsor Sen. Graciela Guzmán

    6/24/2025Senate

  5. Sent to the Governor

    6/20/2025House

  6. Added as Alternate Co-Sponsor Sen. Steve Stadelman

    5/22/2025Senate

  7. Added as Alternate Co-Sponsor Sen. Christopher Belt

    5/22/2025Senate

  8. Added as Alternate Chief Co-Sponsor Sen. Sue Rezin

    5/22/2025Senate

  9. Added as Alternate Co-Sponsor Sen. Willie Preston

    5/22/2025Senate

  10. Added as Alternate Co-Sponsor Sen. Mary Edly-Allen

    5/22/2025Senate

  11. Added as Alternate Co-Sponsor Sen. Adriane Johnson

    5/22/2025Senate

  12. Passed Both Houses

    5/22/2025House

  13. Third Reading - Passed; 056-000-000

    5/22/2025Senate

  14. Added as Alternate Co-Sponsor Sen. Karina Villa

    5/16/2025Senate

  15. Added as Alternate Co-Sponsor Sen. Celina Villanueva

    5/16/2025Senate

  16. Added Co-Sponsor Rep. Thaddeus Jones

    5/16/2025House

  17. Placed on Calendar Order of 3rd Reading May 13, 2025

    5/8/2025Senate

  18. Second Reading

    5/8/2025Senate

  19. Placed on Calendar Order of 2nd Reading May 8, 2025

    5/7/2025Senate

  20. Do Pass Financial Institutions; 008-000-000

    5/7/2025Senate

  21. Added as Alternate Co-Sponsor Sen. Rachel Ventura

    5/7/2025Senate

  22. Added as Alternate Chief Co-Sponsor Sen. Robert Peters

    5/7/2025Senate

  23. Assigned to Financial Institutions

    4/29/2025Senate

  24. Added Co-Sponsor Rep. Amy Briel

    4/23/2025House

  25. Referred to Assignments

    4/14/2025Senate

Bill Text

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