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Bill

HB 1279

DEBT RESOLUTION SERVICES ACT

104th Regular Session Introduced by Dee Avelar and 2 co-sponsors

Illinois bill creates licensing requirements and consumer protections for debt resolution companies, restricting practices and fees while establishing regulatory oversight.

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WeVote Research Nonpartisan
Bill Summary · HB 1279

Legislative bill overview

HB 1279 establishes a regulatory framework for debt resolution services in Illinois, creating licensing requirements, consumer protections, and operational standards for companies that negotiate, settle, or manage consumer debts. The bill defines prohibited practices, establishes fee limitations, and creates enforcement mechanisms through the Illinois Department of Financial and Professional Regulation.

Why is this important

Debt resolution services operate in a largely unregulated space where consumers are vulnerable to predatory practices, excessive fees, and false promises. This bill directly affects millions of Illinoisans struggling with debt by establishing baseline protections and oversight, while also shaping how debt relief companies can conduct business in the state.

Potential points of contention

  • Fee structure regulation — Limiting what debt resolution companies can charge may reduce availability of services or force stricter underwriting, potentially excluding lower-income consumers who need help most
  • Industry compliance costs — New licensing and regulatory requirements increase operational expenses, which could be passed to consumers or consolidate the market toward larger firms
  • Scope and definitions — Determining what constitutes a "debt resolution service" versus legitimate financial counseling or legal services creates jurisdictional questions and potential loopholes

Compiled from official sources — confirm details with the bill’s official record.

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