Oregon collection agencies need to get a license and a surety bond to do business in the state. Keep reading to find out how to get licensed and bonded.
Oregon collection agency license
An ever-increasing number of financial professions are submitting license applications through the Nationwide Multistate Licensing System (NMLS), including Oregon collection agencies. Collection agencies are defined as those that collect third-party debts, collect on debts for their own company, or repossess vehicles in the state. They register with the Oregon Division of Financial Regulation. New agency applicants need to provide the Division with the following information, fees and documents:
- $350 application fee
- $15 credit report fee per control person
- Completed form MU1
- Surety bond in the required amount
- Other trade name or DBA for business (if applicable) along with proof of registration with theSecretary of State
- Registered agent and primary contact employee(s)
- Disclosure questions, form MU2
- Business plan
- State-issued Certificate of Authority/Good Standing
- Formation documents for business entity: corporation, LLC, partnership, etc.
See the NMLS checklist for a complete list of materials the Division needs from collection agency applicants. Registrations expire annually on December 31 and renewals require a $120 fee.
Collection agencies need to register branch locations if they are located outside the state and conduct business in Oregon, unless the agency gets a waiver from the state.
Getting a surety bond
Oregon collection agencies’ surety bond requirement is their promise to abide by the provisions of Oregon Administrative Rules Chapter 441, Division 810 and Oregon Revised Statutes�Chapter 697. Agencies based in the state need a $10,000 surety bond. Out-of-state agencies that do not qualify for the waiver need to add $5,000 to that amount and obtain a $15,000 surety bond.
Should a collection agency’s fraudulent or unlawful practices cause financial damages to a consumer, the consumer can file a claim against the surety bond to recover those damages. If the claim is valid, the consumer can be awarded the amount of their claim, which the surety pays out initially. The bondholder�the collection agency�is responsible for reimbursing the surety for any paid claims.