Debt relief in Illinois: collection rules, time limits and your options
Updated November 9, 2026
Illinois at a glance (checked November 2026)
| Illinois | |
|---|---|
| Time limit to sue on credit cards | Usually 5 years |
| Signed written contracts, such as loan notes | 10 years |
| Wage garnishment for consumer debt | Up to 15% of gross pay; the first $675 a week of take-home pay is protected |
| State debt collection law | Collection Agency Act (205 ILCS 740) |
| Who licenses debt collectors | Illinois Department of Financial and Professional Regulation (IDFPR) |
| Where to complain | IDFPR, Illinois Attorney General, and the CFPB |
Debt collection rules in Illinois
Collection agencies and debt buyers need a license from the Illinois Department of Financial and Professional Regulation under the state's Collection Agency Act. The Act bans threats of violence or arrest, harassing calls and false statements about what you owe, and IDFPR can fine or discipline agencies that break it. Illinois made the Act permanent in 2025 and narrowed who is exempt from licensing starting in 2026.
The federal Fair Debt Collection Practices Act covers third-party collectors too. They can't call before 8 a.m. or after 9 p.m., must send you a validation notice, and have to stop collecting if you dispute the debt in writing within 30 days, until they verify it.
How long creditors have to sue
- 5 years for credit cards in most Illinois cases. Courts have generally applied the 5-year limit for unwritten contracts and open accounts, because a card's terms aren't in one signed document (735 ILCS 5/13-205).
- 10 years for written contracts, such as a signed loan note (13-206).
The clock usually starts when you default. A payment or a written promise to pay can restart it, so check how old a debt is before you pay anything on it. If a debt buyer sues you, Illinois court rules require it to give details about the original account and the chain of ownership, so check them against your own records.
What can be garnished in Illinois
Illinois calls wage garnishment a "wage deduction." A creditor with a judgment can take the lesser of 15% of your gross weekly pay or the amount by which your take-home pay is more than 45 times the higher of the federal or Illinois minimum wage (735 ILCS 5/12-803). At Illinois's $15 minimum wage, that means the first $675 a week of take-home pay can't be touched. It's a tighter cap than the federal 25%.
Child support and taxes follow separate rules. Social Security and other federal benefits stay protected from ordinary creditors, even in your bank account.
Ways out of debt in Illinois
- Nonprofit credit counseling can set up a debt management plan with lower card rates and one monthly payment. Look for an agency accredited by the NFCC or FCAA.
- Using home equity can cut your rate, but it turns card debt into debt secured by your house. Our home equity consolidation calculator compares the two before you decide.
- Debt settlement companies can't charge you a fee until they've actually settled a debt, under federal rules. Forgiven amounts can count as taxable income.
- Bankruptcy: Illinois makes you use its own exemption list rather than the federal one. A bankruptcy attorney can tell you what you would keep.
Where to get help or complain
- Illinois Department of Financial and Professional Regulation licenses collection agencies and takes complaints about them.
- Illinois Attorney General, Consumer Protection takes consumer complaints.
- Consumer Financial Protection Bureau takes complaints about collectors and lenders nationwide.
- Illinois Legal Aid Online has free legal information and forms, and lists legal aid offices.
General information about Illinois law, not legal advice. Checked November 2026.