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Debt buying

Do I need a license to buy debt?

Reviewed May 2026

Short answer

In many states, yes. Debt buyers who purchase accounts and then collect on them are increasingly licensed as collection agencies or under a separate debt-buyer category, and a surety bond is often required. A few states treat passive debt buyers, who outsource all collection, differently from active buyers who collect themselves.

States have moved toward licensing the businesses that purchase charged-off accounts, not only the agencies that collect for others. Where a debt-buyer license exists, buying and then collecting on consumer debt usually triggers it. Some states distinguish a passive debt buyer, who hires a licensed third party to collect, from an active buyer who collects directly.

Because you take ownership of the accounts, the licensing question follows the consumers whose debts you bought, so a portfolio spread across states can require several licenses and bonds.

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