California Debt Collection Laws: A Creditor's Guide

4 yearsCCP §337 written contract

DFPI licenseMandatory since Jan 2022

USD 500+Pre-judgment attachment

The Federal Floor: FDCPA and Its Limits

4 yearsWritten contract CCP §337From breach/due date

2 yearsOral contract CCP §339Shorter period

DFPIDebt Collection LicenseBoth B2B and consumer

10 yearsJudgment enforcementRenewable indefinitely

CCP §481Pre-judgment attach.Commercial claims USD 500+

Collection process

1

DFPI license check + demand

Verify agency holds active DFPI Debt Collection Licensing Act license. Formal demand letter citing written contract. Rosenthal Act: consumer only. B2B = no FDCPA/Rosenthal.

2

Pre-judgment attachment (CCP §481)

Commercial claims ≥USD 500 from business activity. Noticed motion + undertaking (2x claim value). Sheriff freezes bank accounts, equipment, receivables before trial. Forces early settlement.

3

Judgment enforcement

Writ of execution (CCP §699.510). Bank levy (CCP §700.140). Earnings withholding (CCP §706.010). Judgment lien on real property. Renewable every 10 years (CCP §683.020).

California is creditor-friendly for commercial claims despite its consumer-protective reputation. FDCPA and Rosenthal Act cover CONSUMER debt only — B2B invoices between companies fall outside both. The DFPI licensing requirement (Jan 2022) applies to ALL debt collection including B2B.

Statute of Limitations — California Code of Civil Procedure

Claim typePeriodStatute

Written contract (invoice, supply agreement)

4 years

CCP §337 — most common B2B track, from date payment due

4 yrs

Open book account

4 years

CCP §337(1) — running account, from last entry

4 yrs

Statutory liability / fraud / trespass

3 years

CCP §338 — various statutory claims

3 yrs

Oral contract

2 years

CCP §339 — shorter, document everything in writing

2 yrs

Judgment enforcement

10 years

CCP §337.5 — renewable via §683.020 indefinitely

10 yrsRenewable

What are the debt collection laws in California?

Three frameworks: (1) FDCPA (15 U.S.C. §1692) — third-party consumer collectors only. (2) Rosenthal Act (Civil Code §§1788-1788.33) — first-party consumer creditors. (3) Debt Collection Licensing Act (Financial Code §100000) — ALL collectors including B2B must hold DFPI license since January 2022. CCP governs enforcement remedies.