How to get your license: Collection agencies
Who needs a license?
- Any business that:
- Solicits, collects, or attempts to collect debts on behalf of a third party (client).
- Purchases delinquent or charged off debts for collection purposes, whether it collects the debts itself, or hires a third party to collect the debts.
- Any individual collecting a debt, using any name other than their own when contacting a debtor to collect a debt owed to the individual.
Washington is a closed-border state. You must have a license before contacting debtors or soliciting clients in Washington.
Determine the type of license you need
- You need a Collection Agency License (in-state) if:
- Your main office is located in Washington, or
- You have, or plan to have, clients located in Washington. In this case, you also need a business office located in Washington managed by a Washington resident.
- You need an Out-of-State Collection Agency License if you are contacting debtors in Washington, either directly or through a third party, who owe money to you or to your out-of-state clients.
Requirements
- All collection agencies (except debt buyers) must establish a trust account at a federally insured banking institution for money collected on behalf of their clients. This account must have sufficient funds to pay all obligations to clients.
- For in-state agencies, the bank must be located in Washington.
- Out-of-state collection agencies may be able to waive certain requirements. You must submit additional documents with your application to request a waiver.
- Surety bond: You don't need a surety bond if you already have the bond or legal alternative required by the state in which your agency is located.
- Licensing fee: You do not need to pay the licensing fee if your agency is licensed or registered in a state that does not require payment of a fee for similar out-of-state collection agencies.
How to apply
Note: We issue this license, but it's processed by the Department of Revenue's Business Licensing Service (BLS). BLS prints it on the business license they provide. They refer to licenses issued by us as endorsements to the business license.
Collection Agencies must register with the Secretary of State (sos.wa.gov) before applying for a license.
Apply online with the Department of Revenue
What you'll need
- Supporting documents, shown below, ready for upload
- Visa, MasterCard or American Express credit/debit card (transaction fee charged) or bank account information for E-check to pay:
- Applicable BLS fees
- Collection agency or out-of-state collection agency license fees
Want to apply by mail?
- Complete or get all of the following:
- Business License Application
- Business License Application Supplement for Collection Agency, Branch Office, or Out-of-state Office for each business location.
- Supporting documents shown below
- If applying for more than 1 location, a Location Addendum for each additional location.
- Mail all forms, supporting documents, and a check/money order payable to the Department of Revenue for the applicable BLS fees and the fees for the appropriate collection agency license type to:
State of Washington
Business Licensing Service
PO Box 9034
Olympia, WA 98507-9034
After we have received all required documents and payment, you'll receive your license or denial letter within 3 weeks.
If you have a change of address, please notify us by email to BLS@dor.wa.gov or by mail to the address above. Please include your UBI number.
Supporting documents for your application
- All collection agencies (in-state and out-of-state)
- Business Financial Statement/Balance Sheet showing all of the following:
- Liabilities and assets of the agency in 1 of the 3 months prior to application. For example, if you apply in May, we will accept a financial statement for February, March, or April.
- $7,500 or more in cash or its equivalent. $5,000 of the cash must be deposited in a bank account used to operate the business.
- Equity, or net worth, of $7,500 or more.
- A $5,000 surety bond. Your insurance company must:
- Fill out a Collection Agency or Out-of-State Collection Agency Surety Bond form.
- Include their power of attorney form with the surety bond form.
- Business Financial Statement/Balance Sheet showing all of the following:
- Out-of-state collection agencies only:
- If you are requesting a waiver of the Washington bonding requirement, proof that your bond is current and a copy of your home state regulations regarding collection agency bonding requirements.
- If you are requesting a waiver of the licensing fee, a copy of your home state regulations regarding collection agency fees.
