Debt relief in Michigan: collection rules, time limits and your options
Updated November 9, 2026
Michigan at a glance (checked November 2026)
| Michigan | |
|---|---|
| Time limit to sue on credit cards and most consumer debts | 6 years |
| Wage garnishment for consumer debt | Up to 25% of take-home pay |
| State debt collection laws | Occupational Code (collection agencies) and Regulation of Collection Practices Act (creditors and others) |
| Who licenses debt collectors | Department of Licensing and Regulatory Affairs (LARA) |
| Where to complain | LARA, the Michigan Attorney General, and the CFPB |
Debt collection rules in Michigan
Collection agencies in Michigan need a license from the Department of Licensing and Regulatory Affairs (LARA) under the Occupational Code (MCL 339.901 and following), and the same law sets rules for how they collect. The Regulation of Collection Practices Act (MCL 445.251 and following) covers creditors collecting their own debts and others the Occupational Code doesn't reach. Both laws ban threats, harassment and misleading statements about a debt.
The federal Fair Debt Collection Practices Act applies to 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
Michigan gives creditors 6 years for most debts, including credit cards, personal loans and medical bills (MCL 600.5807). The clock usually starts when you default.
Once 6 years have passed, a collector can still ask you to pay but can't sue you or threaten to. A payment or a written promise to pay can sometimes restart the clock, so get advice before paying anything on a very old debt.
If a creditor wins in court, the judgment lasts 10 years in Michigan and can be renewed, so it's worth answering a lawsuit rather than letting it go by default.
What can be garnished in Michigan
Michigan follows the federal limit. A creditor with a judgment can take the lesser of 25% of your take-home pay or the amount you earn above $217.50 a week, which is 30 times the federal minimum wage.
Child support and taxes follow separate rules. Social Security and other federal benefits stay protected from ordinary creditors, even after they're deposited in your bank account.
Ways out of debt in Michigan
- Nonprofit credit counseling can put your cards on one debt management plan, usually at lower rates. Look for an agency accredited by the NFCC or FCAA.
- Moving card balances to a 0% offer can cut your interest if your credit is still good. Our balance transfer calculator shows what you'd save after the transfer fee.
- 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: Michigan lets you choose between its own exemption list and the federal one. A bankruptcy attorney can tell you which keeps more of what you own.
Where to get help or complain
- LARA, collection agencies licenses collection agencies and handles complaints about them.
- Michigan Attorney General explains where to complain about a collection agency.
- Consumer Financial Protection Bureau takes complaints about collectors and lenders nationwide.
- Michigan Legal Help has free guides on dealing with debt collectors and debt lawsuits.
General information about Michigan law, not legal advice. Checked November 2026.