Information for Adjusters

Debt relief companies cannot collect advance fees, according to a new Federal Trade Commission rule effective October 27, 2010. | More information

Debt adjusting is defined in KRS 380.010 (3) - doing business in debt adjusting, budget counseling, debt management, debt modification or settlement, foreclosure assistance, or debt pooling service, or holding oneself out as acting or offering or attempting to act as an intermediary between a debtor and his or her creditors for a fee, contribution, or other consideration, or by words of similar import, as providing services to debtors in the management of their debts, to do any of the following:

  1. Effect the adjustment, compromise, settlement, modification, or discharge of any account, note or other indebtedness of the debtor;
  2. Receive from the debtor and disburse to the debtor's creditors any money or other thing of value; or
  3. Solicit business and advertise as a debt adjuster

About Kentucky's debt adjusting law


StatuteMaximum fee
380.040(2)(a) - Initial set up fee$75.00
380.040(2)(b) - Annual consultant fee$50.00
380.040(2)(c) - Periodic fee (on money paid to the debt adjuster each month for distribution to the debtor's creditors)greater of 8.5% or $30.00
380.040(3) - Bad check chargegreater of $20.00 or amount passed on by the bank
380.040(4) – Other fees for services in relation to debt that is secured by a mortgage on residential real propertyNo fee can be accepted in advance of the complete performance of all promised services.

Debt adjusting annual registration

Effective June 20, 2005, any person that engages in debt adjusting in Kentucky shall file an initial registration form, accompanied by an initial registration fee of two hundred fifty dollars ($250), and the registration shall be renewed each year thereafter for a fee of two hundred fifty dollars ($250) to cover the actual cost of filing the registration, in accordance with administrative regulations promulgated by the Attorney General. A person engaged in debt adjusting shall obtain and at all times maintain insurance coverage for errors and omissions, employee dishonesty, depositor's forgery, computer fraud and violations of the debt adjuster laws, as well as post a surety bond or an irrevocable letter of credit. The amount of the required insurance coverage and surety bond is increased if adjusting a debt that is secured by a mortgage on residential real property.

The registration may be renewed by filing a renewal registration using Form DA-1 and paying the renewal fee, and filing the results of the annual audit and the auditor's opinion with the audit checklist (Form DA-2) completed by the auditor. The renewal registration form, fee, and audit checklist are due at least four (4) weeks prior to the expiration of the registration. Please note that the annual audit must include an audit of your organization's business, including any trust funds deposited and distributed to creditors on behalf of debtors, must be conducted by an independent, third-party certified public accountant, and must be no older than twelve months prior to the date of filing the renewal registration.

To register, please complete the forms and mail them to:

Office of the Attorney General
Attn: Debt Adjusting
1024 Capital Center Drive, Suite 200
Frankfort, Kentucky 40601