Debt collection lawsuits are back in force and are exceeding pre-pandemic levels in many places, according to data released recently. Two recent reports, one from January Advisors and another from the National Center for State Courts (NCSC), highlight the rise in filings during 2023 and 2024, signaling that the issue is once again crowding civil dockets across the country.
According to Pew, as many as 4.7 million debt cases were filed nationwide in 2022. While filings slowed during the pandemic years, recent data shows a dramatic rebound, with lawsuits now climbing in both rural and urban jurisdictions. Case-level data reviewed by January Advisors, including Minnesota, Indiana, North Dakota, Connecticut, Missouri, and Virginia, confirms that filings in 2024 surpassed 2019 benchmarks in several states. Early 2025 data from Connecticut and Minnesota suggests the surge is still accelerating.
Top filers drive much of the growth: A small group of debt buyers and banks are accounting for a significant share of the increase. In Indiana, for example, the top 10 plaintiffs nearly doubled their share of filings between 2019 and 2024. One debt buyer in particular dramatically expanded its activity, increasing filings by 350% since 2019. By 2024, it accounted for nearly one in five debt collection lawsuits in certain jurisdictions.
The NCSC study also pointed to technology as a potential contributor to rising case volumes. Researchers found that contract-based lawsuits, such as debt cases, rose 21% in 2022 and 15% in 2023, while other types of civil cases remained flat. AI’s ability to automate and accelerate filings could make mass litigation more cost-effective for collectors.
Consequences and calls for reform: The human toll remains significant. Fewer than 10% of defendants in these cases have legal representation, and many don’t show up in court at all. This leaves judges to enter default judgments that can lead to wage garnishments, liens, and judgments that last a decade or more.
Consumer advocates and researchers are urging policymakers and court leaders to consider reforms, such as requiring stronger documentation before cases proceed, eliminating barriers like filing fees, and ensuring that consumers are properly notified and able to participate. Minnesota has already enacted measures through its Debt Fairness Act, while other states are weighing similar changes.
