Virginia’s New Uniform Consumer Debt Default Judgments Act: What Creditors Need to Know About HB 444

On April 8, Virginia Governor Abigail Spanberger signed HB 444, the Uniform Consumer Debt Default Judgments Act, into law. The Act establishes pleading and notice requirements in certain consumer debt collection actions that must be met for a creditor to obtain a default judgment against a consumer. This Act is based on a model drafted by the Uniform Law Commission, similar versions of which have been enacted in Washington and introduced in Pennsylvania. HB 444 will take effect on July 1, 2027.

Link to Scope Scope

The Act’s pleading and notice requirements only apply to actions brought to collect an unsecured consumer debt, a secured consumer debt if the action is brought solely to obtain a money judgment, or a deficiency that remains after disposition of property that secured a consumer debt. The Act does not apply to actions to take possession of or dispose of real or personal property or to collect a debt owed to a government in which the government is the plaintiff.

Link to Complaint and Notice Requirements Complaint and Notice Requirements

The Act provides that a default judgment shall only be entered in covered actions if certain pleading and notice requirements are met. The Act requires a complaint to contain certain information, including:

1. The name and address of the consumer at the time of charge off or at the time of default;
2. The name of the creditor;
3. An account identifier associated with the debt;
4. The date and amount of the last payment;
5. The date of the charge off or default;
6. The amount of the outstanding balance;
7. The amount of the judgment sought and an itemization of the outstanding balance, including finance charges, fees or costs, attorney fees, and credits and payments;
8. A statement as to whether the amount of the judgment may increase due to accrued interest, fees, or other charges;
9. The authority of the plaintiff to bring the action;
10. Facts sufficient to demonstrate that the action is being commenced in a proper venue;
11. Facts sufficient to demonstrate that the action is being commenced within the applicable statute of limitations; and
12. Unless the plaintiff is the creditor, the name of each person that acquired ownership of the debt after charge off or default, and the date of each acquisition of the consumer debt.

The Act also requires a plaintiff to attach to the complaint documentation demonstrating the existence of the debt, and, if the plaintiff is not the creditor, documentation demonstrating the plaintiff’s authority to collect the debt.

The Act requires a plaintiff to attach a separate notice to the complaint that warns the consumer that a default judgment might be awarded against them. A compliant notice example is provided in Virginia Code § 8.01-465.29(C) and the Act directs the Office of the Executive Secretary of the Supreme Court of Virginia to promulgate a form consistent with the Act’s notice requirements.

Notably, the Act deems void any waiver by a consumer of the Act’s requirements, but does not prevent a voluntary settlement or judgment between the parties that does not result in a default judgment.

Link to The Foreseeable Impact of HB 444 The Foreseeable Impact of HB 444

In debt collection actions covered by the Act, creditors must comply with the heightened pleading standards and notice requirements to obtain default judgment as a remedy. While compliance with the Act’s requirements is straightforward, it is essential that creditors comply in order not to waive their right to obtain a default judgment. Notably, the Act does not specify what other remedies, if any, are available to a creditor who fails to comply with the Act’s pleading and notice requirements where the consumer does not respond to the complaint.