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Kansas Debt Relief: Your Guide to State Laws and Managing Debt

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Kansas recently became the No. 1 producer of wind energy in the country, and is one of the top agricultural producing states in the U.S. But Kansas has something else going for it as well — fiscally responsible citizens. With the exception of student loans, Kansans’ consumer debt loads fall toward the lower end of the spectrum nationally.

Still, debt can become a burden anywhere, even among people who tend to be conservative borrowers. That’s especially true in places with lower incomes, and the 2017 Kansas median income of $56,422 was lower than the national median of $61,372. A change in your income or family circumstances can force you into debt or make previously manageable payments challenging. But there are debt relief options in Kansas that can help you cope with your debt load, which we’ll cover in this guide.

Debt in Kansas: At a glance

Kansas debt
Type Per capita balance, 2018 Rank out of 50 states* U.S. per capita balance
Credit card debt $2,830 32 $3,220
Student loan debt $5,480 20 $5,390
Auto debt $4,120 40 $4,700
Mortgage debt** $23,690 40 $33,680
*No. 1 is the highest
**First-lien debt only
Source: Federal Reserve Bank of New York, March 2019

Debt collection in Kansas

Carrying debt can inspire feelings of fear, insecurity, shame, and self-doubt. But remember that your debts don’t reflect your self-worth, and you have rights no matter how much you owe. If you are overwhelmed, there are options for debt management and debt discharge, which we will address in subsequent sections.

Sometimes courts will grant creditors’ requests to garnish your wages if you have defaulted on your debts and have not taken steps to resolve them via debt management or repayment agreements. However, creditors are limited in how much they may take from your paycheck. Federal law stipulates that creditors may garnish only 25% of your disposable income per workweek, and they’re also not allowed to take any money if your disposable income falls below a certain amount. If your weekly income is not more than 30 times the federal minimum hourly wage, your earnings are not eligible for garnishment.

If you or a family member becomes ill and you cannot work for more than two weeks because of that illness, creditors may not garnish your wages until two months after your recovery.

Responding to collection letters

When you receive a collections letter, you’re entitled to information concerning the debt. You may send the creditor a request for verification to ensure the debt is yours and that the amount owed is accurate. Do this before you make any payment arrangements.

If you’re unable to pay, contact a financial adviser or debt management company that can help you figure out your next steps. Having a professional in your corner enables you to strategize how to deal with your current debts and avoid similar situations in the future.

Federal laws protect consumers from abusive collections practices, so if a creditor repeatedly contacts or threatens you, remember that you have recourse against them. You can send a stop contact letter (also known as a cease letter) requesting that the creditor not contact you except to inform you about legal actions taken against you.

As a consumer, you’re also entitled to set boundaries on how and when creditors contact you. For instance, you can tell them not to call at inconvenient times, such as when you’re at work. Under the Fair Debt Collection Practices Act, creditors are forbidden from discussing your debts with your family and friends without your permission.

Should you encounter an abusive creditor or collections agency, you can report the company to the Consumer Financial Protection Bureau. You can also file complaints with the Kansas State Attorney General’s Office.

Understanding your state’s statute of limitations

If you have a long-standing debt, you may not be subject to legal action after a certain period of time. Once the statute of limitations on the debt ends, the creditor can no longer sue you or pursue wage garnishment. They can still attempt to collect the debt out of court, however.

Be aware that the statute of limitations resets if you acknowledge the debt as your own or you make a payment on it. So, if a creditor approaches you with a payment plan offer outside of the statute of limitations and you accept it, they will be able to sue for the debt once again. If you’re unsure whether your debt is still eligible for legal action, refer to the date on your most recent payment. The statute of limitations begins at that point.

The following table shows the statute of limitations for several common types of debts in the state of Kansas.

Kansas Statute of Limitations on Debt
Mortgage debt 5 years
Medical debt 5 years
Credit card 3 years
Auto loan debt 4 years
State tax debt 10 years

Kansas debt relief programs

Speaking with a debt management expert can make all the difference to your mindset and your finances. If you don’t know where to begin in dealing with your debt, consider contacting the nonprofit Consumer Counseling Credit Service. The organization operates offices in Wichita and Salina, and it offers debt management plans, education, and bankruptcy counseling.

Before you sign up with a debt management plan, however, it’s important to understand what they can and can’t achieve. Debt management companies cannot guarantee that creditors will negotiate, and they will charge a fee for their services. Under a debt management plan, you repay the full amount you owe, though creditors may be willing to lower the interest rates as part of the new agreement.

Debt settlement companies also offer to negotiate your debts down, but they will tell you to stop paying on your debts until they reach an agreement with your creditors. In the meantime, you will pay into an escrow account where they will hold your money until your creditors agree to settle. Again, creditors do not have to participate, and your credit will suffer while you wait for a response.

Debt settlement is a costly option because in addition to the fee you’ll pay the company, you will also accrue interests and fees on your accounts. If the creditors do not agree to a settlement, you’ll be responsible for those additional charges.

The Consumer Financial Protection Bureau (CFPB) advises against working with companies that charge upfront fees, guarantee to clear your debts or instruct you to cease communication with your creditors.

Payday lending laws in Kansas

Emergencies happen, often at the worst possible times. Maybe your car breaks down and you don’t get paid for another two weeks, or you need medical care but haven’t yet met your insurance deductible. Unless you have emergency savings set aside, you may be tempted to take out a payday loan to get cash quickly before your next paycheck.

Payday loans are generally easy to obtain, as long as you have proof of employment and a bank account. But they carry high fees and many people find that they can’t repay the loans when they get their next checks. They roll the loans over, accruing additional fees, and soon find themselves drowning in payday loan debt.

These are predatory lending products, and you are best off avoiding them. Talk to your bank or credit union about getting a small personal loan. You might also consider borrowing from friends or family. Asking relatives for money can be distressing, but they may loan you the money without interest or even offer it as a gift.

If you feel you have no other options and choose to take out a payday loan, verify that the lender is licensed. Payday lenders in Kansas are regulated by the State Bank Commissioner of Kansas, and they are limited in how much they can loan and how much they can charge on those loans. These restrictions are as follows:

  • Maximum loan amount: $500
  • Maximum loan term: 30 days
  • Finance charges: No more than 15%

Tips to tackle debt in Kansas

Debts can become unmanageable for a number of reasons, not the least of which is high interest rates. If you’re paying on multiple interest-accruing accounts, your monthly installments may feel completely unattainable, particularly if you don’t earn enough to keep up with your basic living expenses and your bills.

Read on for steps you can take toward debt reduction and debt consolidation in Kansas.

Consolidate your Kansas debt

Rather than paying on several loans or credit cards at once, you might apply for a personal loan to use for debt consolidation. This is the number one reason Kansans use personal loans, followed by credit card refinancing. You can use the loan proceeds to pay off your other accounts, and you’ll be left with just one payment per month. Ideally, you’ll be able to set up auto-pay so you don’t need to worry about missing a payment date and accruing late fees.

To obtain an unsecured personal loan (meaning you won’t need to use any assets for collateral), you’ll need a good credit score and a low debt-to-income (DTI) ratio. You may be able to take out an unsecured loan with a co-signer if you don’t quite meet these criteria, however. The co-signer essentially vouches for you by assuming responsibility for the loan in the event that you cannot make your payments.

If you don’t qualify for an unsecured loan, you may be able to get a secured personal loan using assets such as your car or other high-end items you own to back the agreement.


Depending on your current mortgage or auto loan interest rates, you might save money by refinancing your debts. If you’re a homeowner, a cash-out refinance of your mortgage can serve as a debt management tool. Assuming that you have more than 20% equity in the house, you may be able to get a new loan for more than what you currently owe on the mortgage.

You can take the difference as a lump sum of cash that you can use to pay down your non-house debts. This may be particularly helpful if you’re struggling under the weight of credit card balances and other high-interest debts, as you are likely to get a better interest rate on a mortgage than you are on unsecured products.

Remember, though, that you are increasing the amount you owe on your property. If you’re not confident you can make your new mortgage payments, a cash-out refinance could jeopardize your house, so this is not a decision to make lightly.

Look for student loan relief programs

Kansas offers several student loan assistance programs for physicians, health care providers, and residents who move to one of 77 designated rural areas. Specifics of the programs vary, but they include features such as tax waivers and forgiveness of certain loan amounts.

Use a balance transfer card

If you have good credit, consider applying for a balance transfer credit card with a low interest rate or with a promotional introductory rate of 0%. Then transfer your current balances to this card to pay them off. The key here is to pay off the balance before the regular interest rate kicks in (usually after 12 to 21 months) so that you don’t end up incurring even more debt.

Filing for bankruptcy in Kansas

There may come a point at which you realize you simply cannot repay your debts, which is when you’ll want to speak with a credit counselor or local attorney. They will review your finances with you and counsel you on whether you should declare bankruptcy.

In Chapter 7 bankruptcy, you would sell off all of your assets and use the proceeds to pay your creditors. If you file for Chapter 13 bankruptcy, you may keep your assets but you’ll be put on a three- to five-year payment plan to settle your debts. Chapter 13 applies in situations in which you earn a steady income that can be used toward your debts.

Although bankruptcy should be seen as a last resort, it may provide relief if you are deeply in debt. Your credit will suffer in the short-term following bankruptcy proceedings, but if you avoid accruing debt in the future, you can rebuild your credit within a few years.

The bottom line

Kansans who are struggling with debt should know that there are resources available to help them. Whether you need to consolidate your debts or consider more extreme measures, there are ways to alleviate your debt burden. The critical point is to remain calm even in the face of mounting debts so you can understand your rights and make the best choices for your financial situation.

The information in this article is accurate as of the date of publishing.


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