Maine’s Debt Collection Regulation: Transition to NMLS and Licensing Requirements

A new chapter titled “Establishment of License and Renewal Fees and Application Requirements for Maine’s Debt Collect Licensing and Requirement for Licensing Through the Nationwide Multistate Licensing System (NMLS)” has been introduced as part of the recent regulation for debt collectors. This chapter, numbered as 02-030 CMR Ch. 705, aims to define the licensing requirements for debt collectors, including collection agencies, repossession companies, residential real estate property preservation providers, and debt buyers, as defined in the Maine Fair Debt Collection Practices Act (32 M.R.S. § 11002(5-A) and (6)).

Modifications to Debt Collection Licensing Requirements

• Transition to the NMLS: The licensing process for debt collectors will now be administered through the Nationwide Multistate Licensing System (NMLS). Existing licenses for collection agencies, repossession companies, and residential property preservation providers, set to expire on July 31, 2023, will be automatically extended through December 31, 2023. The transition period to NMLS for existing license holders will be from November 1, 2023, to December 31, 2023.
• Annual License: The license term for debt collectors will change from a two-year license to a one-year license. The new annual licensing period will be from January 1 through December 31 of each year.
• Application and Renewal Fees: The new rule sets application and renewal fees for debt collector licenses. The annual fee for the licensee will be $400, and each licensed branch office will have a fee of $200.
• Credit for Existing Licensees: Licensees with licenses scheduled to expire after 2023 will receive a credit of 1/4 of the current two-year license fee for each 1/2 year remaining on their license towards the renewal fee.
• Late Renewal Applications: Renewal applications received between January 1 and January 31, 2024, will be assessed a late fee of $100. After January 31, 2024, renewal applications transitioning to NMLS will not be accepted, and all applications received will be considered new, subject to the new application fee of $400 plus the branch office fee of $200.

Transition to NMLS

Regarding the transition to NMLS, specific details are yet to be provided, and updates will be available on the Bureau’s website at a later date. Existing debt collector license holders must monitor the Bureau’s website and the NMLS for any future updates on the transition process.

Information and Documentation Requirements

Both new and renewal debt collector license applicants will be required to provide information and documentation, including ownership details, financial statements, resumes demonstrating previous business experience, sample collection form letters, a completed bond form, and contact information for examinations and complaints.

Changes to Existing License Information or Control

The new rules address changes to existing license information or changes in control of the licensee. Licensees must update information reported to NMLS within 30 days of any change. Approval from the Bureau is required for any change of control, failing which, the license will be immediately and automatically revoked.