Iowa Debt Collection Laws and Your Rights

Your federal rights

These federal rules apply in Iowa and every other state. Iowa's own law, below, can add more.

Who the federal law covers. The Fair Debt Collection Practices Act (FDCPA) covers debt collectors who collect for someone else and companies that buy debts, not usually the original creditor collecting its own debt (15 U.S.C. 1692a(6)). Some state laws also cover original creditors.
A validation notice. A collector must give you a validation notice, in its first message or within 5 days after it, with the amount, the creditor and how to dispute (15 U.S.C. 1692g(a); 12 CFR 1006.34).
Your right to dispute. If you dispute the debt in writing within the validation period (30 days after you get the notice), the collector must stop collecting until it mails you verification (15 U.S.C. 1692g(b); 12 CFR 1006.38).
When collectors can contact you. No calls before 8 a.m. or after 9 p.m. your time, or at work if your employer doesn't allow it (15 U.S.C. 1692c(a)). More than 7 calls in 7 days about one debt is presumed to break the law (12 CFR 1006.14(b)(2)).
Telling a collector to stop. If you tell a collector in writing to stop contacting you, it must stop, except to tell you it is ending collection or will take a specific step such as a lawsuit (15 U.S.C. 1692c(c)).
What collectors can't do. No threats, obscene language, false statements (for example pretending to be a lawyer or the government, or threatening arrest) and no unfair practices such as collecting fees your contract doesn't allow (15 U.S.C. 1692d, 1692e, 1692f). A collector generally can't discuss your debt with your family, neighbors or employer (15 U.S.C. 1692c(b)).

Read how to dispute a debt or stop collector calls.

Iowa law and extra protections

State law: Iowa Debt Collection Practices Act (part of the Iowa Consumer Credit Code)
Law: Iowa Code §§ 537.7101–537.7103
Covers original creditors: Yes
Extra protections: The law covers anyone collecting a covered consumer debt, including a creditor collecting its own debt (Iowa Code § 537.7102(5)).
A collector may contact your employer only in limited ways: once a month to verify employment, or once every 3 months to ask about debt counseling, without saying the debt is in default (Iowa Code § 537.7103(3)(a)(5)-(6)).
A collector may not falsely threaten arrest, garnishment or seizure of property, or threaten any action the law does not allow (Iowa Code § 537.7103(1)).
A collector may not get you to reaffirm a debt discharged in bankruptcy without explaining that you don't have to (Iowa Code § 537.7103(5)(b)).
Can you sue under it?: Yes. You can recover actual damages plus a penalty set by the court of $100 to $1,000 (not in a class action) for unfair collection practices under § 537.7103 (Iowa Code § 537.5201(1)(a)(25)). Time limits: for credit cards and other open-end credit, sue within 2 years of the violation; for other credit, within 1 year after the last scheduled payment date (§ 537.5201(1)(b)).
Official text: Read the law

Old debts in Iowa

Written contracts: 10 years
Open accounts and unwritten agreements: 5 years
Does a payment restart the clock?: A written, signed admission that the debt is unpaid, or a new promise to pay, revives a contract claim (Iowa Code § 614.11). The statute does not mention payments.
Must collectors say a debt is too old?: No Iowa rule found. Under federal Regulation F, a debt collector may not sue you or threaten to sue you on a time-barred debt (12 C.F.R. § 1006.26(b)).
Law: Iowa Code § 614.1(4) (unwritten: 5 years), § 614.1(5) (written: 10 years); § 614.11
Official text: Read the law

The time limit is the statute of limitations. Once it runs out, the debt is “time-barred”: a collector must not sue or threaten to sue you, but the debt still exists. Read more about time-barred debt.

Is my debt too old? Check Iowa's time limit

Every state limits how long a creditor or collector has to sue you over a debt. This is the statute of limitations. Choose your state, the type of debt and the date of your last payment to see the limit and an estimated end date. Nothing you type here is sent anywhere.

Wage garnishment and bank accounts in Iowa

Wage limit: Stricter than federal: on top of the federal limit, each judgment creditor can garnish only a yearly maximum tied to your expected income — $250 if you expect to earn under $12,000; $400 ($12,000–$15,999); $800 ($16,000–$23,999); $1,500 ($24,000–$34,999); $2,000 ($35,000–$49,999); 10% of expected earnings at $50,000 or more. Support orders and some other debts are exceptions.
Bank account: Up to $1,000 total in cash, bank or credit union deposits, or other personal property you choose (Iowa Code § 627.6(14)).
Law: Iowa Code § 642.21

Federal benefits such as Social Security, SSI and VA benefits that were directly deposited are protected in your bank account up to two months' worth (31 CFR 212.6). A creditor usually needs a court judgment before it can garnish your wages or bank account.

Property you can keep in Iowa

Iowa protects your homestead (generally up to 1/2 acre in a city or 40 acres elsewhere, Iowa Code § 561.2), one motor vehicle up to $7,000, and household goods and furnishings up to $7,000 total (Iowa Code § 627.6(5), (9)). Social Security, unemployment and public assistance benefits are exempt (Iowa Code § 627.6(8)).

Collector licensing in Iowa

License required: No statewide license
Who licenses: No collection license. Debt collectors above a dollar threshold must file a yearly notification with the Consumer Credit Code administrator (Iowa Attorney General) (Iowa Code §§ 537.6201, 537.6202).

If you are sued in Iowa

Time to answer: District court: file a motion or answer within 20 days after you are served (Iowa R. Civ. P. 1.303(1)). Small claims ($6,500 or less): file an Appearance and Answer by the date written on the Original Notice.
If you don't answer: If you don't file an answer, the court or clerk can enter a default judgment giving the plaintiff what was asked for (Iowa Code § 631.5; Iowa Judicial Branch small claims page).
Court self-help: Iowa court self-help (official)

Don't ignore court papers. Read what to do if a debt collector sues you.

Where to complain in Iowa

Iowa: Iowa Attorney General – Consumer Protection Division · 515-281-5926
Federal: the Consumer Financial Protection Bureau takes complaints about debt collectors at consumerfinance.gov/complaint · (855) 411-2372.
You can also report a collector to the Federal Trade Commission at ReportFraud.ftc.gov.

Free help in Iowa

Good to know in Iowa

Iowa's yearly per-creditor garnishment caps are unusually protective for low and middle incomes (Iowa Code § 642.21).
An employer may not fire you because your wages were garnished; you have 2 years to sue for lost wages (Iowa Code §§ 642.21(2)(c), 537.5201(5)).

Free letters to send a collector

Dispute a debt and ask for proof (validation letter)

Within 30 days of the collector's validation notice.

Tell a collector to stop or limit contact

Stop all contact, writing only, or no calls at work.

Questions about debt collection in Iowa

What is the statute of limitations on debt in Iowa?

10 years for written contracts and 5 years for open accounts and unwritten agreements (Iowa Code § 614.1(4) (unwritten: 5 years), § 614.1(5) (written: 10 years); § 614.11).

Does paying on an old debt restart the clock in Iowa?

A written, signed admission that the debt is unpaid, or a new promise to pay, revives a contract claim (Iowa Code § 614.11). The statute does not mention payments.

Must a collector tell me a debt is too old to sue on in Iowa?

No Iowa rule found. Under federal Regulation F, a debt collector may not sue you or threaten to sue you on a time-barred debt (12 C.F.R. § 1006.26(b)).

How much of my paycheck can be garnished in Iowa?

Stricter than federal: on top of the federal limit, each judgment creditor can garnish only a yearly maximum tied to your expected income — $250 if you expect to earn under $12,000; $400 ($12,000–$15,999); $800 ($16,000–$23,999); $1,500 ($24,000–$34,999); $2,000 ($35,000–$49,999); 10% of expected earnings at $50,000 or more. Support orders and some other debts are exceptions.

How much money in a bank account is protected in Iowa?

Up to $1,000 total in cash, bank or credit union deposits, or other personal property you choose (Iowa Code § 627.6(14)).

Do debt collectors need a license in Iowa?

No. No collection license. Debt collectors above a dollar threshold must file a yearly notification with the Consumer Credit Code administrator (Iowa Attorney General) (Iowa Code §§ 537.6201, 537.6202).

Does Iowa have its own debt collection law?

Yes: the Iowa Debt Collection Practices Act (part of the Iowa Consumer Credit Code) (Iowa Code §§ 537.7101–537.7103). It also covers original creditors collecting their own debts.

How long do I have to answer a debt lawsuit in Iowa?

District court: file a motion or answer within 20 days after you are served (Iowa R. Civ. P. 1.303(1)). Small claims ($6,500 or less): file an Appearance and Answer by the date written on the Original Notice.

Where can I complain about a debt collector in Iowa?

Iowa Attorney General – Consumer Protection Division: https://www.iowaattorneygeneral.gov/for-consumers/file-a-consumer-complaint · 515-281-5926

Sources

Last checked: Oct 24, 2026.

Federal sources

Debt collectors in Iowa: your rights