In Tennessee, almost every company that collects debts owed to someone else must hold an active license issued by the Tennessee Collection Service Board under the Tennessee Collection Service Act (Tenn. Code Ann. § 62-20-101 and following). This is a major protection that the federal Fair Debt Collection Practices Act (FDCPA) does not give you: the federal law regulates how collectors behave, but it does not require them to be licensed at all. In Tennessee, a collection agency that operates without the required license is breaking state law, and an unlicensed agency generally has no legal right to collect or to sue you on the account. That single fact gives Tennessee consumers leverage that residents of many other states do not have.
Tennessee licenses its debt collectors
The Tennessee Collection Service Act creates the Collection Service Board, which operates within the Tennessee Department of Commerce and Insurance. The Board licenses "collection services" — businesses that, for a fee, collect or attempt to collect debts owed to another person, including out-of-state agencies that collect from Tennessee residents. To get and keep a license, an agency must meet character and financial requirements, designate a qualifying manager, and in most cases post a surety bond that can be used to repay consumers who are harmed.
The federal FDCPA, by contrast, applies nationwide to third-party collectors but contains no licensing scheme. So when a collector contacts you in Tennessee, you actually have two layers of protection: the federal behavioral rules of the FDCPA and the state licensing and conduct rules of the Collection Service Act. Before you pay or negotiate, it is worth confirming that the agency is licensed.
How to check whether a collector is licensed
The Department of Commerce and Insurance maintains license information for collection services. You can verify a collector's status by searching the Department's online license verification system or by contacting the Collection Service Board directly. If the company demanding payment is not licensed and cannot show it qualifies for an exemption, treat that as a serious red flag and consider it grounds for a complaint.
Protections that go beyond the federal FDCPA
Tennessee layers several additional protections on top of the federal baseline:
Licensing and bonding. As above, collectors must be licensed and frequently bonded, so a wronged consumer may have a bond to recover against — something the FDCPA does not provide.
Board discipline. The Collection Service Board can investigate complaints and impose discipline, including fines and license suspension or revocation, on agencies that violate the Act. The federal FDCPA generally requires you to sue in court to enforce it; in Tennessee a regulator can act against a bad actor without you filing a lawsuit.
The Tennessee Consumer Protection Act. Tenn. Code Ann. § 47-18-101 and following prohibits unfair or deceptive acts in trade and commerce. Deceptive collection tactics can violate this Act, which allows private lawsuits and, in some cases, treble (triple) damages and attorney's fees for willful or knowing violations.
Coverage of original creditors. The federal FDCPA usually applies only to third-party collectors and debt buyers, not to the original creditor collecting its own debt. Tennessee's consumer-protection and collection rules can reach a broader range of conduct, so a first-party creditor that uses deceptive tactics is not automatically off the hook in Tennessee.
Wage garnishment in Tennessee
If a collector wins a judgment, it may try to garnish your wages. The federal cap under the Consumer Credit Protection Act limits garnishment of disposable earnings to the lesser of 25% of disposable earnings or the amount by which weekly disposable earnings exceed 30 times the federal minimum wage. Tennessee follows this federal 25% ceiling and adds a state-specific cushion: under Tenn. Code Ann. § 26-2-107, an additional amount is exempt from garnishment for each of the debtor's dependent children. As of 2026 that additional exemption is a small fixed amount per dependent child per week, and you must typically claim it. Because the figures and procedures can change, confirm the current amount and the form you must file with the court clerk before you rely on it.
How long can a Tennessee debt be sued on?
A collector's power to sue you is limited by Tennessee's statute of limitations. For most written contracts and open accounts — including typical credit-card debt — Tennessee generally applies a six-year limitations period under Tenn. Code Ann. § 28-3-109. Once that period has run, the debt is "time-barred" and a collector who sues can be defeated by raising the statute of limitations as a defense. Be careful: making a payment or acknowledging the debt in writing can sometimes restart the clock. Because the correct limitations period depends on the exact type of debt and the facts, confirm it for your specific situation before assuming a debt is too old to enforce.
Your federal rights still apply
Tennessee's rules sit on top of the federal protections you keep no matter where you live. Under the FDCPA you can demand that a collector stop contacting you, dispute the debt in writing within 30 days of the collector's validation notice and require verification, and be free from harassment, threats, and false statements. Under the federal Fair Credit Reporting Act (FCRA) you can dispute inaccurate collection entries on your credit reports. Use these federal tools together with Tennessee's licensing and consumer-protection laws — they reinforce each other.
How to file a complaint in Tennessee
Tennessee gives consumers more than one place to turn:
Tennessee Attorney General — Division of Consumer Affairs. The Division of Consumer Affairs, part of the Office of the Tennessee Attorney General and Reporter, accepts complaints about unfair and deceptive business practices, including abusive debt collection, and enforces the Tennessee Consumer Protection Act. You can file a consumer complaint through the Attorney General's office, which may mediate your dispute and tracks patterns of misconduct for enforcement.
Tennessee Collection Service Board (Department of Commerce and Insurance). File here when your complaint is about a collection agency's licensing or conduct under the Collection Service Act. The Board can discipline licensees and address unlicensed activity.
Federal regulators. You can also complain to the Consumer Financial Protection Bureau and the Federal Trade Commission, which enforce the FDCPA and related federal laws.
When you complain, include the collector's name and address, account or reference numbers, copies of letters and account statements, and a short timeline of what happened. Keep notes of every call — dates, times, and what was said — because documentation is what turns a complaint into an enforceable case.
Where to verify the law
Statutes and dollar figures change, so verify before you act. The Tennessee Collection Service Act and the Tennessee Consumer Protection Act are published in the Tennessee Code Annotated. License status is verified through the Tennessee Department of Commerce and Insurance. For complaints and current consumer guidance, the Office of the Tennessee Attorney General and Reporter, Division of Consumer Affairs, is the official state source. If a debt has reached the lawsuit stage or a large sum is at stake, talk with a licensed Tennessee attorney — many handle FDCPA and consumer cases on terms that shift the cost to the violator.
Official Tennessee Sources
This page is based on Tennessee law. Limits and deadlines change — verify the current details directly with the official Tennessee sources below. This is general legal information, not legal advice.
Federal law also applies. Federal laws like the Fair Debt Collection Practices Act and Fair Credit Reporting Act protect you nationwide, on top of Tennessee’s own rules.
Frequently asked questions
Do debt collectors have to be licensed in Tennessee?
Yes. Under the Tennessee Collection Service Act, most agencies that collect debts owed to others must be licensed by the Tennessee Collection Service Board within the Department of Commerce and Insurance, and many must post a surety bond. The federal FDCPA has no licensing requirement, so this is an added Tennessee protection. You can verify a collector's license through the Department before paying.
What is the statute of limitations on debt in Tennessee?
Tennessee generally applies a six-year limitations period to most written contracts and open accounts, including typical credit-card debt, under Tenn. Code Ann. § 28-3-109. After it expires, a debt is time-barred and you can raise the statute of limitations as a defense to a lawsuit. Making a payment or acknowledging the debt in writing can restart the clock, and the exact period depends on the type of debt, so confirm it for your situation.
How much of my wages can be garnished in Tennessee?
Tennessee follows the federal cap of 25% of disposable earnings (or the amount above 30 times the federal minimum wage, whichever is less). Tennessee also adds an extra exemption for each dependent child under Tenn. Code Ann. § 26-2-107, which you usually must claim with the court. Confirm the current per-child amount and the form to file with the court clerk.
Where do I file a complaint against a debt collector in Tennessee?
File with the Tennessee Attorney General's Division of Consumer Affairs for unfair or deceptive practices under the Tennessee Consumer Protection Act, and with the Tennessee Collection Service Board for licensing or conduct issues under the Collection Service Act. You can also complain to the federal CFPB and FTC. Include account numbers, copies of letters, and a timeline of contacts.
Does Tennessee law protect me from the original creditor, not just collection agencies?
Often, yes. The federal FDCPA usually covers only third-party collectors and debt buyers, but the Tennessee Consumer Protection Act reaches unfair and deceptive acts in trade and commerce more broadly, which can include conduct by original creditors. That Act allows private lawsuits and, for willful or knowing violations, potential treble damages and attorney's fees.
This article is general legal information, not legal advice, and may not reflect the most current law or the law in your jurisdiction. Laws vary by state and change over time. For advice about your specific situation, consult a licensed attorney.
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