State guides · California
California debt relief and debt laws
California has its own protections for people in debt: a 2-year window to sue on oral debts, a garnishment cap below the federal one, and a collection law that reaches the original lender too. The rules, the free help, and your options.
Each California rule links to the code section or state page behind it.
California at a glance
California debt law, in 11 facts.
Where we stand in California
Pending counsel review
Our counsel is reviewing California registration rules for debt settlement providers, and where we stand under them, before we describe how we work with California residents.
LicensingLicense or registration details are being confirmed with counsel.
See every state and license on our licensing and disclosures page.
Who regulates collectors and debt relief here
- Dept. of Financial Protection and InnovationLicenses debt collectors, registers debt settlement providers, and takes complaints about both. California Department of Financial Protection and Innovation source, opens in a new tab
- Checking a collectorThe DFPI points consumers to NMLS Consumer Access to look up a licensed debt collector. California Department of Financial Protection and Innovation source, opens in a new tab
- Attorney GeneralTakes consumer complaints about a business through an online form. California Attorney General source, opens in a new tab
Consumer bankruptcies in California
Up 14.9%
Across California's four federal court districts, 54,719 consumer (nonbusiness) bankruptcy cases were filed in the year that ended June 30, 2026, up from 47,634 a year earlier. The Central District, which covers Los Angeles, Orange, Riverside and San Bernardino counties, rose the most: 18.2%.
As of June 30, 2026. Source: U.S. Courts (opens in a new tab)
California guides
California debt law, explained in five guides.
Every guide quotes the code section it relies on, shows the day we last checked it, and ends with where to find a lawyer or free legal aid.
Time limits
How long can a creditor sue in California?
Four years, two years, or ten on a judgment, and why a payment does not bring an expired debt back.
Bankruptcy
California bankruptcy or settlement?
The two exemption systems, the means test median, and when Chapter 7 or 13 is the better tool.
Lawsuits
Sued for a debt in California
Limited civil cases, the 30-day response, what a debt buyer must prove, and free court help.
Garnishment
Wage garnishment in California
The 20% cap, the minimum wage test, and how a Claim of Exemption works.
Collectors
The Rosenthal Act and collector licensing
What California bans, who needs a license, and where to report a collector.
Which California laws limit debt collectors?
The Rosenthal Fair Debt Collection Practices Act is California's own collection law. It defines a debt collector as anyone who regularly collects on behalf of that person or others (California Legislature, opens in a new tab), so a bank collecting its own card balance is covered, not only agencies and debt buyers.
It also pulls in the federal rules: covered collectors must follow the federal FDCPA conduct rules (California Legislature, opens in a new tab) as well.
- No threat of arrest, or of taking wages or property, unless that step is really planned and legal.
- No repeated calls meant to annoy, and no calls so frequent they amount to harassment.
- A licensed collector must print its California license number on letters and give it on request.
- Once your lawyer asks in writing, contact generally goes through the lawyer.
A collector who breaks the Rosenthal Act owes your actual damages, plus $100 to $1,000 (California Legislature, opens in a new tab) more for a willful violation. The deadline to sue is one year from the violation.
What does a debt lawsuit look like in California?
A claim of up to $35,000 (California Legislature, opens in a new tab) is heard as a limited civil case. The summons tells you to file a written response within 30 days (California Legislature, opens in a new tab) after it is served, and warns that a default can lead to garnished wages.
Debt buyers face extra rules. Small claims court is closed to an assignee of a claim (California Legislature, opens in a new tab), and a debt buyer's complaint must attach the contract (California Legislature, opens in a new tab) or another document showing the debt.
We are not a law firm and cannot give legal advice. If you have been served, contact a legal aid office or a certified lawyer referral service before the 30 days run out.
What can a creditor in California not take?
Even with a judgment, a creditor cannot empty your paycheck or your account. Wage withholding is capped by a minimum wage test (California Legislature, opens in a new tab), and if what is left is not enough to live on, you can ask the court to protect the part your family needs for support (California Legislature, opens in a new tab).
A bank levy leaves the first $2,325 (Judicial Council of California, opens in a new tab) in your accounts alone without any paperwork, and directly deposited Social Security has its own protected amount.
For most people the home is safe from a forced sale over credit card or medical debt. Under a law added in 2020, a judgment lien for a consumer debt cannot be used to sell your main residence (California Legislature, opens in a new tab) unless the debt was secured by that home. Taxes, support and some large bank judgments are exceptions.
How does California regulate debt settlement companies?
California has its own debt settlement law, the Fair Debt Settlement Practices Act. It applies to companies that negotiate with creditors for less than the full balance, which includes us.
The federal Telemarketing Sales Rule (FTC, opens in a new tab) already bans fees before a settlement. California adds its own version and more.
- You receive the contract and a set of plain disclosures at least three days before you sign.
- No fee until at least one debt is settled and you have made a payment under that settlement.
- You may cancel at any time, in writing, online or by phone, with no fee or penalty.
- The company must forward any notice of a lawsuit on an enrolled debt to you right away.
These rules come from Cal. Civ. Code § 1788.302 (California Legislature, opens in a new tab). Since February 15, 2025, the DFPI also requires debt settlement providers to register with the Department (California Department of Financial Protection and Innovation, opens in a new tab) before serving Californians. Our own registration status is in the facts box on this page and on our licensing and disclosures page.
Which debt options do Californians have?
Nonprofit
Credit counseling
A certified counselor goes through your budget. A debt management plan repays the whole balance, usually at a reduced interest rate.
What we do
Debt settlement
Each creditor is asked to take less than you owe. It suits $10,000 or more in unsecured debt, carries a fee, and lowers your credit score1.
In court
Bankruptcy
Chapter 7 or Chapter 13, using one of California's two exemption systems. Speak with a bankruptcy attorney first.
On your own
Ask each lender
Call before an account is charged off and ask about hardship terms. Keep every change in writing.
Out of work in California? File for unemployment first.
If your job ended or your hours were cut, file an unemployment insurance claim with the Employment Development Department (California Employment Development Department, opens in a new tab) right away; the first payment takes about three weeks to arrive. Then write to your creditors about the change and ask what hardship options they offer.
Your weekly amount depends on what you earned in the base period, and the total for the year is capped by Cal. Unemp. Ins. Code § 1281 (California Legislature, opens in a new tab).
Where to get legal help
Free and low-cost legal help in California.
We are not a law firm and cannot give legal advice. These are the people who can, many of them free. None of them pays us, and we do not pay them.
-
A lawyer
A State Bar certified lawyer referral service
The State Bar of California certifies referral services by region. Lawyers they refer must be in good standing and carry professional liability insurance.
Open the State Bar list (opens in a new tab) -
Legal aid
LawHelpCA
Maintained by the Legal Aid Association of California: plain-language legal information and a finder for free legal services near you.
Open LawHelpCA (opens in a new tab) -
Court self-help
California Courts Self-Help Guide
The California courts' own guide to debt lawsuits: your options, and step-by-step instructions for responding by type of debt.
Open the Self-Help Guide (opens in a new tab) -
Legal aid
Free legal aid near you
Legal aid offices give free civil legal help, including with debt lawsuits, to people who qualify. The Legal Services Corporation finder lists the office for your area.
Find legal aid (LSC) (opens in a new tab) -
A lawyer
How to find a consumer lawyer
The CFPB explains where to look for a lawyer who handles debt collection cases, and what experience to look for.
Read the CFPB guide (opens in a new tab)
Things you should know
The downsides, stated plainly.
Read these before you enroll anywhere, including with us. They apply to every debt settlement program.
- Your credit score will drop during the program, and late payments stay on your credit report.
- Creditors may keep collecting while you save, and they can sue. The program does not stop legal action.
- Interest and late fees can keep adding to your balances until each account settles.
- Forgiven debt may be taxable income. A creditor may send you IRS Form 1099-C.
- Fees apply. The fee is a percentage of your enrolled debt, set individually, and charged only after a settlement is reached.
- Not all creditors agree to settle, and not everyone completes the program.
- We do not guarantee any amount, percentage or timeline.
- Debt settlement is not available in all states. We are not a nonprofit or a credit counseling service, and we do not lend money.
- We do not give legal or tax advice. Talk to an attorney or a tax professional about your situation.
Notes on the figures and claims above
- 1Whether an account settles, and for how much, depends on the creditor. Not all debts settle. Your credit score will drop during the program, creditors may sue, and forgiven debt may be taxable. Fees apply.
Straight answers
California debt questions, plain answers.
Rather hear it from a person? 866-659-7966
What is the statute of limitations on credit card debt in California?
Generally 4 years for a debt based on a written contract or an account, and 2 years for one that is not. Which period applies to a particular card depends on the documents, so ask a lawyer or legal aid office.
How much of my paycheck can be garnished in California?
After a judgment, the most is the lesser of 20% of your disposable earnings for the week or 40% of the amount above 48 times the minimum wage. You can also ask for more to be protected if your family needs it for support.
Can a debt collector take my house in California?
A judgment lien for a consumer debt generally cannot be used to force the sale of your main home unless the debt was secured by it. Taxes, support and some other debts are exceptions.
Where do I report a debt collector in California?
The Department of Financial Protection and Innovation takes complaints about debt collectors and debt relief providers. The Attorney General and the CFPB also take complaints.
Sources
Where the facts on this page come from. Each link opens the original in a new tab.
- 01 California Legislature Cal. Code Civ. Proc. § 337: 4 years on a written contract or book account; (d) no suit after the period runs (opens in a new tab)
- 02 California Legislature Cal. Code Civ. Proc. § 339: 2 years on a contract not founded on a writing (opens in a new tab)
- 03 California Legislature Cal. Code Civ. Proc. § 412.20: the summons (30 days to file a written response) (opens in a new tab)
- 04 California Legislature Cal. Code Civ. Proc. § 85: limited civil cases, up to $35,000 (opens in a new tab)
- 05 California Legislature Cal. Code Civ. Proc. § 116.221: small claims for a natural person ($12,500) (opens in a new tab)
- 06 California Legislature Cal. Code Civ. Proc. § 116.420: no small claims filed by the assignee of a claim (opens in a new tab)
- 07 California Legislature Cal. Civ. Code § 1788.58: what a debt buyer's complaint must include (opens in a new tab)
- 08 California Legislature Cal. Code Civ. Proc. § 706.050: the most that can be withheld from wages (operative Sept. 1, 2023) (opens in a new tab)
- 09 California Legislature Cal. Code Civ. Proc. § 706.051: earnings needed to support you and your family are exempt (opens in a new tab)
- 10 Judicial Council of California Form EJ-156: Current dollar amounts of exemptions from enforcement of judgments (rev. July 20, 2026) (opens in a new tab)
- 11 California Legislature Cal. Code Civ. Proc. § 704.220: money in a deposit account exempt without a claim (opens in a new tab)
- 12 California Legislature Cal. Code Civ. Proc. § 699.730: no forced sale of your home for a consumer debt judgment lien, with exceptions (opens in a new tab)
- 13 California Legislature Cal. Civ. Code § 1788.2: Rosenthal Act definitions (debt collector includes those collecting their own debts) (opens in a new tab)
- 14 California Legislature Cal. Civ. Code § 1788.17: the federal FDCPA rules apply through state law (opens in a new tab)
- 15 California Legislature Cal. Civ. Code § 1788.30: remedies ($100 to $1,000; one year to sue) (opens in a new tab)
- 16 California Legislature Cal. Civ. Code § 1785.27: medical debt may not be reported to credit bureaus (opens in a new tab)
- 17 California Legislature Cal. Civ. Code § 1788.302: Fair Debt Settlement Practices Act rules (disclosures, fees, cancellation) (opens in a new tab)
- 18 California Department of Financial Protection and Innovation Debt settlement services: registration under the California Consumer Financial Protection Law (from Feb. 15, 2025) (opens in a new tab)
- 19 FTC Debt Relief Services and the Telemarketing Sales Rule: A Guide for Business (opens in a new tab)
- 20 California Department of Financial Protection and Innovation Submit a complaint (including debt collectors and debt relief providers) (opens in a new tab)
- 21 California Department of Financial Protection and Innovation Debt Collection Licensing Act: who must be licensed and how to look up a licensee (opens in a new tab)
- 22 California Attorney General Consumer complaint against a business or company (opens in a new tab)
- 23 California Employment Development Department Unemployment insurance ($40 to $450 a week) (opens in a new tab)
- 24 California Legislature Cal. Unemp. Ins. Code § 1281: the most benefits payable in a benefit year (opens in a new tab)
- 25 U.S. Courts Table F-2: bankruptcy filings by district, 12 months ending June 30, 2026 (opens in a new tab)
- 26 U.S. Courts Table F-2: bankruptcy filings by district, 12 months ending June 30, 2025 (opens in a new tab)
- 27 CFPB Submit a complaint (opens in a new tab)
Next step
Live in California? Check the math first.
Run an illustrative estimate on your unsecured debt, with our fee shown on its own line. Nothing is signed until you agree, and California law lets you cancel at any time.
Four short steps
Your estimate first. Contact details last.
- 1How much you owea close guess is fine
- 2What kinds of debtpick all that apply
- 3Which state you live inchecked before anything else
- 4Your estimate, then a real person if you want one