STUDENT LOAN BILL OF RIGHTS ACT
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HB 82 — STUDENT LOAN BILL OF RIGHTS ACT
Last action — DO PASS, as amended, committee report adopted
No card. One bill, free forever — alerts when it moves.
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✓Introduced
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2In Committee
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3Passed House
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4Passed Senate
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5To Executive
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6Enacted
This bill died with 2023 Regular Session. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.
This bill is no longer active — its legislative session has ended, so there is no live prognosis. It would have to be reintroduced in the current session to move again.
Bill Text
What changed in the latest version
2349 added · 2018 removedPlain-language change summary
The changes in House Bill 82 include the addition of specific sections about student loan servicers, allowing them to obtain a license and detailing their responsibilities. These amendments aim to enhance oversight by giving the Financial Institutions Division the power to enforce regulations related to student loans. This is significant because it seeks to protect borrowers by ensuring that student loan servicers adhere to clear standards and responsibilities. The bill also clarifies mechanisms for discharging student loans in cases of permanent disability, which could provide relief for affected individuals.
HOUSE BILL 82 56TH LEGISLATURE -STATEOFNEWMEXICO-- STATEOFNEWMEXICO- FIRST SESSION, 2023 INTRODUCED BY Christine Chandler and Patricia Roybal Caballero 6This 8document 10may ANincorporate ACTamendments RELATINGproposed TOby FINANCIALa INSTITUTIONS;committee, but not yet adopted, as well as amendments that have been adopted during the current legislative session.
ENACTINGThe THEdocument STUDENTis LOANa BILLtool OFto RIGHTSshow ACT;amendments in context and cannot be used for the purpose of adding amendments to legislation.
PROVIDINGh FORAN AACT STUDENTg LOANo SERVICER'SRELATING LICENSE;TO FINANCIAL INSTITUTIONS;
ENACTING THE STUDENT LOAN t hr g e i k BILL OF RIGHTS ACT;
PROVIDING FOR A STUDENT LOAN SERVICER'S h r i s LICENSE;
h , t, GIVING ADMINISTRATIVE RESPONSIBILITY AND ENFORCEMENT POWER TO e u g e b l e e h THE FINANCIAL INSTITUTIONS DIVISION OF THE REGULATION AND n d d i = = o h LICENSING DEPARTMENT;
PROVIDING FOR DISCHARGE OF PRIVATE el t] 17b ,d i a º e EDUCATION LOANS UPON A SHOWING OF PERMANENT DISABILITY;
wr li n= r t e w d 18m a n o REQUIRING THAT ALTERNATIVE REPAYMENT OPTIONS BE OFFERED TO =d =m 19: a l BORROWERS EQUALLY;
PROVIDINGb RIGHTSe FORd COSIGNERS,s INCLUDINGº io t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e e a n e d r 20e NOTICEl ANDu ACCESS[ TOA INFORMATION;d BORROWERS EQUALLY;
PROVIDING RIGHTS FOR COSIGNERCOSIGNERS, aINCLUDING tNOTICE mAND mACCESS 21TO RELEASE;INFORMATION;
PROHIBITINGPROVIDING CERTAINFOR ACCELERATIONCOSIGNER OFRELEASE; PRIVATE EDUCATION d r e 22 LOANS;
PROHIBITING CERTAIN ACCELERATION OF PRIVATE EDUCATION LOANS;
c e s k 23 DEFINING CERTAIN VIOLATIONS OF THE STUDENT BILL OF RIGHTS AS e a n b 24 UNFAIR AND UNCONSCIONABLE TRADE PRACTICES;
CREATING A PRIVATE u [ RIGHT OF ACTION;
.223854.3 MAKING AN APPROPRIATION.
3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
[NEW MATERIAL]MATERIAL ] SHORT TITLE.--Sections 1 through 27 of this act may be cited as the "Student Loan Bill of Rights Act".
h (1) means an individual who is liable for the u » r obligation of another without compensation, regardless of how t h g e the individual is designated in the contract or instrument with l i h r i s respect to that obligation, including an obligation under a h , e h private education loan extended to consolidate a borrower's t u g e b l preexisting student loans;
e e , gh n d d i = = o h (2) includes any person whose signature is el t] 17b ,d i a º r requested as a condition to grant credit or to forbear on we lr n= dt 18e w d collection;
and =m = 19 (3) does not include a spousen ofo and individual a l i a e r 20 described in Paragraph (1) of this subsection, the signature of a t m m: 21 whom is needed to perfect the security interest in a loan;
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 2 - e a n e d r e 22l B.u [ A d (3) does not include a spouse of an individual described in Paragraph (1) of this subsection, the signature of whom is needed to perfect the security interest in a loan;
B.
c e s k 23 C.
"division" means the financial institutions e a n b 24 division of the regulation and licensing department;
u [ D.
"person" includes legal representatives, .223854.3 - 2 - unincorporated organizations, trustees, fiduciaries and public entities;
"post-secondary education expense" means any expense associated with attendance at or enrollment in a public or non-publicly funded post-secondary educational institution as defined by Subsections F and G of Section 21-23-3 NMSA 1978 for expenses HECº , including tuition,»HEC related to courses, instruction, training or education;
"private education lender" or "lender" means any h person engaged in the business of securing, making or extending g o t hr private education loans or any holder of a private education g e i k loan.
"Private education lender" does not include the h r i s following persons, only to the extent that state regulation is h , t, preempted by federal law:
e u g e b l e e h (1) a bank or credit union;
n d d i = = o h (2) a wholly owned subsidiary of a bank or el t] 17b ,d i a º e credit union;
wr li n= dr 18t (3)e anw operatingd subsidiarym of a bankn oro =(3) =an 19 a l credit union where each owner of the operating subsidiary isof i a e r 20 wholly owned by the same bank or creditd union;m :
andb ae d s º o t mn = .223854.3AIC February 1, 2023 (12:08pm) s k m 21e (4)- 3 - e a n e d r e l u [ A d credit union where each owner of the higheroperating educationsubsidiary department;is wholly owned by the same bank or credit union;
dand r(4) ethe 22higher G.education department;
G.
c e s k 23 (1) means an extension of credit that is not e a n b 24 made, insured or guaranteed under Title IV of the federal u [ Higher Education Act of 1965;
.223854.3 - 3 - (2) means an extension of credit that is extended to a consumer expressly, in whole or in part, for post-secondary education expenses, regardless of whether the loan is provided by the educational institution that the student attends;
h (a) the term of the extension of credit g o t hr is ninety days or less;
or g e i k (b) an interest rate shall not be h r i s applied to the credit balance and the term of the extension of h , t, credit is one year or less, even if the credit is payable in e u g e b l e e h more than four installments;
n d d i = = o h H.
Show all 500 changed lines (460 more)
el t] 17b ,d i a º e (1) receiving scheduled periodic payments from wr li n= r t e w d 18m a n o a student loan borrower pursuant to the terms of a student =d =m 19: a l education loan;
ib a e rd 20s (2)º applyingo payments of principal and a t mn m= 21.223854.3AIC interestFebruary and1, other2023 payments(12:08pm) withs respectk tom thee amounts- d4 r- e 22 received from a studentn loane borrower,d asr may be required c e sl ku 23[ pursuantA tod the terms of a student education loan;
e(2) aapplying npayments bof 24principal (3)and maintaininginterest accountand recordsother forpayments awith studentrespect uto [the educationamounts loanreceived andfrom communicating with a student loan borrowerborrower, .223854.3as -may 4be -required regardingpursuant ato loanthe onterms behalf of the loan's holder during a periodstudent wheneducation no payment is required on the loan;
(3) maintaining account records for a student education loan and communicating with a student loan borrower regarding a loan on behalf of the loan's holder during a period when no payment is required on the loan;
"student education loan" means an extension of credit primarily for personal use to finance a student loan borrower's post-secondary education expenses, but does not include an isolated personal loan made by an individual to h another for post-secondary education expenses;
g o t hr J.
g e i k (1) a resident of New Mexico who has received h r i s or agreed to pay a student education loan;
or h , t, (2) a person who shares responsibility with a e u g e b l e e h resident of New Mexico for repaying a student education loan;
n d d i = = o h K.
"student loan servicer" means a person engaged el t] 17b ,d i a º e in the business of servicing student education loans in New wr li n= r t e w d 18m a n o Mexico;
and =d =m 19: a l L.
"totalb ande permanentd disability"s meansº theo it n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 5 - e a n e d r 20e conditionl ofu an[ individualA who:d L.
a"total tand mpermanent mdisability" 21means (1) has been determined by the Unitedcondition States d r e 22 secretary of veteransan affairsindividual towho: be unemployable due to a c e s k 23 service-connected disability;
or(1) ehas abeen ndetermined bby 24the (2)United isStates unablesecretary to engage in any substantial u [ gainful activity by reason of anyveterans medicallyaffairs determinable .223854.3 - 5 - physical or mental impairment that can be expected to result in death, has lasted for a continuous period of not less than twelve months or can be expectedunemployable due to last for a continuousservice-connected perioddisability; of not less than twelve months." SECTION 3.
[NEWor MATERIAL](2) LICENSEis REQUIRED--EXEMPTIONS.--unable A.to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death, has lasted for a continuous period of not less than twelve months or can be expected to last for a continuous period of not less than twelve months." SECTION 3.
A[NEW personMATERIAL shall] notLICENSE actREQUIRED--EXEMPTIONS.-- directlyA. or act indirectly as a student loan servicer without first obtaining a license from the division pursuant to the Student Loan Bill of Rights Act, unless that person is exempt from licensure pursuant to Subsection B of this section.
B.A person shall not act directly or act indirectly as a student loan servicer without first obtaining a license from the division pursuant to the Student Loan Bill of Rights Act, unless that person is exempt from licensure h pursuant to Subsection B of this section.
Theg followingo personst arehr exemptB. from licensing requirements pursuant to the Student Loan Bill of Rights Act:
(1)The afollowing bankpersons orare creditexempt union;from licensing g e i k requirements pursuant to the Student Loan Bill of Rights Act:
(2)h ar whollyi owneds subsidiary(1) of a bank or credit union;
(3)h an, operatingt, (2) a wholly owned subsidiary of a bank or e tu 17g credite unionb where each owner of the operating subsidiary is w l ne de 18h wholly owned by the same bank or credit union;
andn d d i = = 19o h (3) an operating subsidiary of a bank or l (4)] b ,d i a º e credit union where each owner of the higheroperating educationsubsidiary department.is r i = r t e w d m a n o wholly owned by the same bank or credit union;
iand ad em r: 20 SECTION 4.
[NEWb MATERIAL]e LICENSEd APPLICATION--s aº o t mn = .223854.3AIC February 1, 2023 (12:08pm) s k m 21e INVESTIGATION--LICENSE- ISSUANCE.--6 - e a n e d r e 22l A.u [ A d (4) the higher education department.
ASECTION person4. seeking to act as a student loan c e s k 23 servicer shall make a written application to the director for e a n b 24 an initial license in a form prescribed by the director.
The[NEW uMATERIAL [] applicationLICENSE shallAPPLICATION-- include:INVESTIGATION--LICENSE ISSUANCE.-- A.
.223854.3A -person 6seeking -to (1)act as a financialstudent statementloan ofservicer theshall personmake applying, prepared by a certifiedwritten orapplication registeredto public accountant, the accuracydirector offor whichan isinitial swornlicense toin under oath before a notaryform publicprescribed by the proprietor,director. a general partner or a corporate officer or a member duly authorized to execute such documents;
(2)The sufficientapplication informationshall pertaininginclude: to the history of any criminal conviction of the applicant, whether an individual or partner, member, officer, director or principal employee of the applicant, as the director deems necessary to make the findings required pursuant to Subsection F of this section;
(3)(1) a nonrefundablefinancial initialstatement licenseof feethe notperson applying, prepared by a certified or registered public accountant, the accuracy of which is sworn to exceedunder fiveoath thousandbefore dollarsa ($5,000);notary public by the proprietor, a general partner or a corporate officer or a member duly authorized to execute such documents;
and(2) (4)sufficient ainformation nonrefundablepertaining investigationto feethe nothistory of any criminal conviction of the applicant, whether an individual or partner, member, officer, director or principal h employee of the applicant, as the director deems necessary to exceedg fiveo thousandt dollarshr ($5,000).make the findings required pursuant to Subsection F of this g e i k section;
eh tr 17i B.s (3) a nonrefundable initial license fee not to h , t, exceed five thousand dollars ($5,000);
Theand directore mayu periodicallyg reducee orb increase w l ne de 18h the(4) amounta ofnonrefundable oneinvestigation orfee morenot ofto then feesd ind Subsectioni A of this = = 19o ah lexceed section,five butthousand indollars no($5,000). case more than the initial fees.
l ] b ,d i a º e rB. 20 C.
The director may requireperiodically reduce or allowincrease applicationsr ai = r t me w d m 21a ton beo madethe electronicallyamount throughof theone nationwideor multistatemore dof rthe efees 22in licensingSubsection systemA andof registry.this d m :
Anb applicante usingd thats systemº co et n = .223854.3AIC February 1, 2023 (12:08pm) s k 23m shalle pay- all7 required- processinge feesa forn e d r e l u [ A d section, but in no case more than the system.initial fees.
eC. a n b 24 D.
UponThe the filing of an application for an initial u [ license and the payment of required fees, the director shallmay .223854.3require -or 7allow -applications investigateto thebe financialmade conditionelectronically andthrough responsibility, the financialnationwide andmultistate businesslicensing experiencesystem and theregistry. character and general fitness of the applicant.
An applicant using that system shall pay all required processing fees for the system.
D.
Upon the filing of an application for an initial license and the payment of required fees, the director shall investigate the financial condition and responsibility, the financial and business experience and the character and general fitness of the applicant.
The director shall issue a license for a student loan servicer pursuant to the Student Loan Bill of Rights Act h if the director finds that:
g o t hr (1) the applicant has submitted a completed g e i k application;
h r i s (2) the applicant's financial condition is h , t, sound;
e u g e b l e e h (3) the applicant's business will be conducted n d d i = = o h honestly, fairly, equitably, carefully, efficiently and in a el t] 17b ,d i a º e manner commanding the confidence and trust of the community;
wr li n d 18 (4) the applicant or a partner, member, = = 19 a l officer, director, trustee, fiduciary or principal employee of i a e r 20 the applicant has not been convicted of a crime that relates to a t me mw 21 money lending, financing, financial matters, fiduciary status, d rm ea 22n trusteeo status,(4) fraud or another matter that substantially c e s k 23 relates to the qualifications,applicant functions or duties of a studentpartner, emember, ad nm b: 24 loan servicer;
ub [e (5)d as personº haso nott maden an= incorrect.223854.3AIC .223854.3February 1, 2023 (12:08pm) s k m e - 8 - statemente of a materialn facte ond behalfr e l u [ A d officer, director, trustee, fiduciary or principal employee of the applicant eitherhas innot thebeen applicationconvicted orof in a reportcrime that relates to money lending, financing, financial matters, fiduciary status, trustee status, fraud or statementanother madematter pursuantthat substantially relates to the Studentqualifications, Loanfunctions Billor duties of Rightsa Act;student loan servicer;
(5) a person has not made an incorrect statement of a material fact on behalf of the applicant either in the application or in a report or statement made pursuant to the Student Loan Bill of Rights Act;
(7) the applicant has paid the license fee and h investigation fee required by this section;
g o t hr (8) the applicant has met all other g e i k requirements of the Student Loan Bill of Rights Act as h r i s determined by the director;
and h , t, (9) if the applicant is:
e u g e b l e e h (a) an individual, the individual is in n d d i = = o h all respects properly qualified and of good character;
el t] 17b ,d i a º e (b) a partnership, eachHECº partnerthe ispartnership inr i = r t e w ld m a n do 18is allregistered respectsto properlydo qualifiedbusiness in New Mexico and ofis in good character;d m :
=b e d s º o t n = 19.223854.3AIC aFebruary l1, (c)2023 a(12:08pm) corporations ork association,m thee i- 9 - e a n e d r 20e followingl areu [ A d standing and»HEC each partner is in all respects properly qualified and of good acharacter; t m m 21 character:
(c) a corporation or association, HECº the corporation or association is registered to do business in New Mexico and is in good standing and»HEC the following are in all respects properly qualified and of good character:
3) d r e 22 senior officer responsible for the corporation's business;
4) c e s k 23 chief financial officer;
or 5) any other person who performs e a n b 24 functions similar to those described in Items 1) through 4) of u [ this subparagraph and as determined by the director;
and 6) .223854.3 - 9 - each director, each trustee and each shareholder owning ten percent or more of each class of the securities of the corporation or association;
or (d) a limited liability company, HECº the limited liability company is registered to do business in New Mexico and is in good standing and»HEC each HECºofficer, h manager or»HEC member is in all respects properly qualified and g o t hr of good character.
g e i k SECTION 5.
[NEW MATERIAL]MATERIAL ] AUTOMATIC ISSUANCE OF LICENSE h r i s FOR FEDERAL STUDENT LOAN SERVICING CONTRACTORS.-- h , t, e u g A.
A person seeking to act as a student loan e b l e e h servicer is excepted from the application procedures described n d d i = = o h in Subsection A of Section 4 of the Student Loan Bill of Rights l ] b ,d i a º e r i = r Act upon a determination by the director that the person's t e w d m a n o student loan servicing performed in this state is conducted pursuantd tom a: contract awarded by the United States secretary of education pursuant to 20 U.S.C.
b e d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 10 - e a n e d r e l u [ A d pursuant to a contract awarded by the United States secretary of education pursuant to 20 U.S.C.
The director shall prescribe the procedure to document eligibility for the e t 17 exception.
w l n d 18 B.
A person deemed excepted by the director = = 19 a l pursuant to this section shall, upon payment of the fees i a e r 20 required by Section 4 of the Student Loan Bill of Rights Act, a t m m 21 automatically be issued a license by the director and shall be d r e 22 considered by the director to have met all requirements set c e s k 23 forth in Subsection F of Section 4 of the Student Loan Bill of e a n b 24 Rights Act.
u [ C.
A person issued a license pursuant to this .223854.3 - 10 - section is exempt from Paragraphs (1) through (3) of Subsection A, Subsection B and Subsection F of Section 4 of the Student Loan Bill of Rights Act.
A person licensed pursuant to this section shall comply with the record retention requirements in Section 8 of the Student Loan Bill of Rights Act except to the extent that the requirements are inconsistent with federal law.
D.
A person issued a license pursuant to this section shall provide the director with written notice within seven days following notification of the expiration, revocation or termination of a contract awarded by the United States secretary of education pursuant to 20 U.S.C.
Section 1087f.
The person has thirty days following notification to satisfy all requirements established under Subsection F of Section 4 of the Student Loan Bill of Rights Act in order to continue to act as a student loan servicer.
At the expiration of the thirty- day period if the requirements have not been satisfied, the e t 17 director shall immediately suspend a license granted to the w l n d 18 person pursuant to this section.
= = 19 a l E.
With respect to student loan servicing not i a e r 20 conducted pursuant to a contract awarded by the United States a t m m 21 secretary of education pursuant to 20 U.S.C.
Section 1087f, d r e 22 nothing in this section prevents the director from issuing or c e s k 23 filing a civil action for an order to temporarily or e a n b 24 permanently bar a person from acting as a student loan servicer u [ or violating applicable law.
.223854.3 - 11 - SECTION 6.
[NEW MATERIAL] LICENSE EXPIRATION--LICENSE SURRENDER--LICENSE RENEWAL--LICENSE SUSPENSION--INFORMATION UPDATE--LICENSE ABANDONMENT--NO ABATEMENT OF FEES.-- A.
A license issued pursuant to the Student Loan Bill of Rights Act shall expire at midnight on December 31 of the year following its issuance, unless renewed or earlier surrendered, suspended or revoked pursuant to the Student Loan Bill of Rights Act.
NotA laterperson thandeemed fifteenexcepted daysby afterthe adirector licenseepursuant ceases to engagethis insection theshall, businessupon payment of studentthe loanfees servicingrequired inby NewSection Mexico4 forof anythe reason,Student theLoan licenseeBill shallof provideRights writtenAct, noticeautomatically ofbe surrenderissued toa license by the director and shall surrenderbe toconsidered by the director itsto licensehave formet eachall locationrequirements inset whichforth thein licenseeSubsection hasF ceasedof toSection engage4 inof the businessStudent ofLoan studentBill loanof servicing.Rights Act.
TheC. written notice of surrender shall identify the location where the records of the licensee will be stored and the name, e t 17 address and telephone number of an individual authorized to w l n d 18 provide access to the records.
TheA surrenderperson ofissued a license doespursuant =to =this 19section ais lexempt not reduce or eliminate the licensee's civil or criminal i a e r 20 liability arising from actsParagraphs or(1) omissionsthrough occurring(3) priorof toSubsection theA, aSubsection tB mand mSubsection 21F surrender of theSection license,4 includingof administrative actions by d r e 22 the director to revoke or suspend a license, assess a civil c e s k 23 penalty, order restitution or exercise any other authority e a n b 24 provided to the director in the Student Loan Bill of Rights u [ Act.
.223854.3A -person 12licensed -pursuant C.to this section shall comply with the record retention requirements in h Section 8 of the Student Loan Bill of Rights Act except to the u » r extent that the requirements are inconsistent with federal law.
t h g e l i D.
A person issued a license pursuant to this h r i s section shall provide the director with written notice within h , e h seven days following notification of the expiration, revocation t u g e b l e e , gh or termination of a contract awarded by the United States n d d i = = o h secretary of education pursuant to 20 U.S.C.
Section 1087f.
l ] b ,d i a º r The person has thirty days following notification to satisfy e r = t e w d m a n o all requirements established under Subsection F of Section 4 of d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 11 - e a n e d r e l u [ A d the Student Loan Bill of Rights Act in order to continue to act as a student loan servicer.
At the expiration of the thirty- day period if the requirements have not been satisfied, the director shall immediately suspend a license granted to the person pursuant to this section.
E.
With respect to student loan servicing not conducted pursuant to a contract awarded by the United States secretary of education pursuant to 20 U.S.C.
Section 1087f, nothing in this section prevents the director from issuing or filing a civil action for an order to temporarily or permanently bar a person from acting as a student loan servicer or violating applicable law.
SECTION 6.
[NEW MATERIAL ] LICENSE EXPIRATION--LICENSE SURRENDER--LICENSE RENEWAL--LICENSE SUSPENSION--INFORMATION UPDATE--LICENSE ABANDONMENT--NO ABATEMENT OF FEES.-- A.
A license issued pursuant to the Student Loan h Bill of Rights Act shall expire at midnight on December 31 of u » r the year following its issuance, unless renewed or earlier t h g e l i surrendered, suspended or revoked pursuant to the Student Loan h r i s Bill of Rights Act.
h , e h B.
Not later than fifteen days after a licensee t u g e b l e e , gh ceases to engage in the business of student loan servicing in n d d i = = o h New Mexico for any reason, the licensee shall provide written l ] b ,d i a º r notice of surrender to the director and shall surrender to the e r = t e w d m a n o director its license for each location in which the licensee d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 12 - e a n e d r e l u [ A d has ceased to engage in the business of student loan servicing.
The written notice of surrender shall identify the location where the records of the licensee will be stored and the name, address and telephone number of an individual authorized to provide access to the records.
The surrender of a license does not reduce or eliminate the licensee's civil or criminal liability arising from acts or omissions occurring prior to the surrender of the license, including administrative actions by the director to revoke or suspend a license, assess a civil penalty, order restitution or exercise any other authority provided to the director in the Student Loan Bill of Rights Act.
C.
The renewal h application shall be filed on or before November 1 of the year u » r in which the license expires.
A renewal application filed with t h g e l i the director after November 1 and before December 31 of the h r i s year in which the license expires, but that is accompanied by a h , e h one-hundred-dollar ($100) late fee, shall be deemed to be t u g e b l e e , gh timely.
If an application for a renewal license has been filed n d d i = = o h with the director on or before the date the license expires, l ] b ,d i a º r the license sought to be renewed shall continue in full force ande effectr until= thet directore issuesw thed renewedm licensea orn theo directorand haseffect notifieduntil the licenseedirector inissues writing of the director'srenewed refusallicense toor renew the license,d includingm the: grounds for the refusal.
Theb directorr maye refuset toº renewo t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 13 - e a licensen one anyd r e tl 17u ground[ uponA whichd director has notified the directorlicensee mayin refusewriting of the director's refusal to issuerenew anthe initiallicense, wincluding lthe ngrounds dfor 18the license.refusal.
=The =director 19may refuse to renew a llicense D.on any ground upon which the director may refuse to issue an initial license.
IfD. the director determines that a check filed i a e r 20 with the director to pay a renewal fee has been dishonored, the a t m m 21 director shall automatically suspend the license.
TheIf director d r e 22 immediately shall give the licenseedirector noticedetermines ofthat the automatic c e s k 23 suspension by any practicable means and initiate proceedings e a ncheck bfiled 24with forthe revocationdirector or refusal to renewpay anda anrenewal opportunityfee forhas abeen udishonored, [the hearingdirector onshall thatautomatically actionsuspend pursuant to the Uniformlicense. Licensing Act.
.223854.3The -director 13immediately -shall E.give the licensee notice of the automatic suspension by any practicable means and initiate proceedings for revocation or refusal to renew and an opportunity for a hearing on that action pursuant to the Uniform Licensing Act.
TheE. applicant or licensee shall notify the director, in writing, of any change in the information provided in its initial application for a license or its most recent renewal application for that license, as applicable, not later than ten business days after the occurrence of the event that results in that information becoming inaccurate.
F.The applicant or licensee shall notify the director, in writing, of any change in the information provided in its initial application for a license or its most recent renewal application for that license, as applicable, not later h than ten business days after the occurrence of the event that u » r results in that information becoming inaccurate.
Thet directorh shallg deeme anl applicationi forF. a license abandoned if the applicant fails to respond to a request for information required by the Student Loan Bill of Rights Act.
The director shall notifydeem thean applicant,application infor writing,a thath r i s license abandoned if the applicant fails to submitrespond thatto informationa noth later, thane sixtyh daysrequest afterfor information required by the dateStudent onLoan whichBill thatof requestt foru informationg wase made,b thel applicatione shalle be, deemedgh abandoned.Rights Act.
The director shall notify the applicant, in n d d i = = o h writing, that if the applicant fails to submit that information l ] b ,d i a º r not later than sixty days after the date on which that request e r = t e w d m a n o for information was made, the application shall be deemed d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 14 - e a n e d r e l u [ A d abandoned.
Abandonment of an application does not e t 17 preclude the applicant from submitting a new application for a w l n d 18 license pursuant to the Student Loan Bill of Rights Act.
= = 19 a l G.
A license fee paid pursuant to the Student Loan i a e r 20 Bill of Rights Act shall not be abated.
a t m m 21 SECTION 7.
[NEW MATERIAL]MATERIAL ] LICENSEE NAMES AND LOCATIONS-- d r e 22 TRANSFERABILITY--ASSIGNABILITY.-- c e s k 23 A.
A licensed student loan servicer shall not e a n b 24 service student education loans under a name or at a place of u [ business other than as listed in the license.
A change of a .223854.3 - 14 - place of business shall require prior written notice to the director.
Not more than one place of business shall be maintained under the same license, but the director may issue more than one license to the same licensee that is in h compliance with the provisions of the Student Loan Bill of g o t hr Rights Act.
g e i k B.
A license for a student loan servicer is not h r i s transferable or assignable.
h , t, SECTION 8.
[NEW MATERIAL ] RECORD RETENTION.-- e u g e b l e e h A.
All private education lenders and student loan n d d i = = o h servicers shall maintain adequate records of each student l ] b ,d i a º e education loan transaction for at least six years following the r i = r t e w d m a n o final payment on a student education loan or the assignment of d m :
b e d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 15 - e a n e d r e l u [ A d a student education loan, whichever occurs first, or a longer period the director may require.
AWithin licensefive business days of receipt of a request for student education loan records from the director, a private education lender or student loan servicer isshall notmake transferablethe records available to the director, or assignable.shall send the records to the director by registered or certified mail, return receipt requested, or by any express delivery carrier that provides a dated delivery receipt.
SECTIONUpon 8.request, the director may grant a licensee additional time to make the records available or send the records to the director.
[NEWSECTION MATERIAL]9. RECORD RETENTION.-- A.
All[NEW privateMATERIAL education] lendersSTUDENT andLOAN studentSERVICERS.--Except loanas servicersotherwise shallprovided maintainin adequatefederal recordslaw, ofa eachfederal student education loan transactionagreement foror ata leastcontract sixbetween years following the finalfederal paymentgovernment onand a student education loan orservicer, the assignment of a student educationloan loan,servicer whichevershall occurscomply first,with or a longer period the directorfollowing mayrequirements: require.
h A.
upon receipt of a written inquiry from a student u » r loan borrower or the representative of a student loan borrower, t h g e l i a student loan servicer shall respond by:
h r i s (1) acknowledging receipt of the written h , e h inquiry within ten days;
and t u g e b l e e , gh (2) within thirty days after receiving the n d d i = = o h inquiry, providing information relating to the inquiry and, if l ] b ,d i a º r applicable, the action the student loan servicer will take to e r = t e w d m a n o correct the student loan borrower's account or an explanation d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 16 - e a n e d r e l u [ A d of the student loan servicer's position that the borrower's account is correct, including copies of all information and account information used by the student loan servicer in reaching the determination;
Within five business days of receipt of a e t 17 request for student education loan recordsservicer fromshall theinquire director,of a w l n d 18 private education lender or student loan servicerborrower shallhow make = = 19 a l the records available to theapply director,an overpayment or shallprepayment send the i a e r 20 records to the director by registered or certified mail, return a tstudent meducation mloan. 21 receipt requested, or by any express delivery carrier that d r e 22 provides a dated delivery receipt.
UponA request,student theloan directorborrower's cdirection eon show kto 23apply mayan grantoverpayment aor licenseeprepayment additionalto timea tostudent makeeducation theloan recordsshall estay ain neffect bfor 24any availablefuture overpayments or sendprepayments during the recordsterm toof a student education loan until the director.borrower provides different directions.
uFor [purposes SECTIONof 9.this subsection, "overpayment" or "prepayment" means a payment on a student education loan in excess of the monthly amount due from a borrower on a student education loan;
[NEW MATERIAL] STUDENT LOAN SERVICERS.--Except .223854.3 - 15 - as otherwise provided in federal law, a federal student education loan agreement or a contract between the federal government and a student loan servicer, a student loan servicer shall comply with the following requirements:
A.
upon receipt of a written inquiry from a student loan borrower or the representative of a student loan borrower, a student loan servicer shall respond by:
(1) acknowledging receipt of the written inquiry within ten days;
and (2) within thirty days after receiving the inquiry, providing information relating to the inquiry and, if applicable, the action the student loan servicer will take to correct the student loan borrower's account or an explanation of the student loan servicer's position that the borrower's account is correct, including copies of all information and account information used by the student loan servicer in e t 17 reaching the determination;
w l n d 18 B.
a student loan servicer shall inquire of a = = 19 a l student loan borrower how to apply an overpayment or prepayment i a e r 20 to a student education loan.
A student loan borrower's a t m m 21 direction on how to apply an overpayment or prepayment to a d r e 22 student education loan shall stay in effect for any future c e s k 23 overpayments or prepayments during the term of a student e a n b 24 education loan until the borrower provides different u [ directions.
For purposes of this subsection, "overpayment" or .223854.3 - 16 - "prepayment" means a payment on a student education loan in excess of the monthly amount due from a borrower on a student education loan;
in the absence of a direction provided by a h student loan borrower pursuant to Subsection B of this section, u » r a student loan servicer shall allocate an overpayment on a t h g e l i student loan account in a manner that is in the best financial h r i s interest of a student loan borrower.
A student loan servicer h , e h shall be considered to meet the requirements of this subsection t u g e b l e e , gh if the servicer allocates the overpayment to the loan with the n d d i = = o h highest interest rate on the borrower's student loan account, l ] b ,d i a º r unless the borrower specifies otherwise.
For the purposes of thise subsection,r "best= financialt intereste ofw ad studentm loana borrower"n meanso reducingthis thesubsection, total"best costfinancial interest of thea student loan,loan includingd principalm and: balance, interest and fees;
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 17 - e a n e d r e l u [ A d borrower" means reducing the total cost of the student loan, including principal and balance, interest and fees;
in the absence of a direction provided by a e t 17 student loan borrower pursuant to Subsection B of this section, w l n d 18 a student loan servicer shall apply a partial payment or = = 19 a l underpayment in a manner that minimizes late fees and negative i a e r 20 credit reporting.
When loans on a student loan borrower's a t m m 21 account have an equal stage of delinquency, a student loan d r e 22 servicer shall apply a partial payment or underpayment to c e s k 23 satisfy as many individual loan payments as possible on a e a n b 24 borrower's account.
For purposes of this subsection, "partial u [ payment" or "underpayment" means a payment on a student .223854.3 - 17 - education loan account that contains multiple individual loans in an amount less than the amount necessary to satisfy the outstanding payment due on all loans in the student education loan account;
h E.
as a condition of the sale, assignment or u » r transfer, the student loan servicer shall require the new t h g e l i student loan servicer to honor all benefits originally h r i s represented as available to the student loan borrower during h , e h the repayment of the student education loan and preserve the t u g e b l e e , gh availability of those benefits, including benefits for which n d d i = = o h the student loan borrower has not yet qualified.
If a student l ] b ,d i a º r loan servicer is not also the loan holder or is not acting on behalfe ofr the= loant holder, the student loan servicer satisfies the requirement established by this subsection by providing the new student loan servicer with information necessary for the new student loan servicer to honor all benefits originally e tw 17d representedm as available to a student loan borrower during the w l n do 18behalf repayment of the student education loan andholder, preserve the = = 19 a l availability of those benefits, including benefits for which i a e r 20 the student loan borrowerservicer hassatisfies notd yetm qualified::
ab r e t mº o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m 21e (1)- the18 student- loane servicera shalln transfere d r e 22l tou the[ newA studentd loanthe servicerrequirement allestablished informationby regardingthis thesubsection cby eproviding sthe knew 23 student loan borrower,servicer thewith accountinformation ofnecessary for the new student loan borrowerservicer eto ahonor nall bbenefits 24originally andrepresented theas studentavailable educationto loana of the student loan borrower,borrower uduring [ including the repayment status of the student education loan borrower and .223854.3preserve -the 18availability -of anythose benefits, including benefits associatedfor withwhich the student education loan ofborrower thehas studentnot loanyet borrower;qualified:
(2)(1) the sale,student assignmentloan orservicer shall transfer ofto the servicingnew student loan servicer all information regarding the student loan borrower, the account of the student loan borrower and the student education loan mustof bethe completedstudent withinloan forty-fiveborrower, daysincluding afterthe repayment status of the sale,student assignmentloan orborrower otherand transferany ofbenefits associated with the servicingstudent education loan of athe student educationloan loan;borrower;
and(2) (3) the parties shall notify affected student loan borrowers of the sale, assignment or other transfer of the servicing of the student education loan atmust leastbe sevencompleted h within forty-five days beforeafter the nextsale, paymentassignment onor other u » r transfer of the loanservicing isof due.a student education loan;
Thisand noticet musth include:g e l i (3) the parties shall notify affected student h r i s loan borrowers of the sale, assignment or other transfer of the h , e h servicing of the student education loan at least seven days t u g e b l e e , gh before the next payment on the loan is due.
(a)This thenotice identitymust ofn thed newd studenti loan= servicer;= o h include:
(b)l the] effectiveb date,d ofi a º r (a) the transferidentity of the new student loan borrower'se studentr education= loant toe thew newd studentm loana n o servicer;
e t 17 (c) the date on which the existing w l n d 18m student: loan servicer will no longer accept payments;
andb =r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 19 - e a n e d r e l (d)u [ A d (b) the contacteffective informationdate forof the newtransfer iof athe estudent rloan 20borrower's student education loan to the new student loan servicer;
a(c) tthe mdate mon 21which F.the existing student loan servicer will no longer accept payments;
a student loan servicer that obtains the right d r e 22 to service a student education loan shall adopt policies and c(d) e s k 23 procedures to verify that the studentcontact loan servicer has e a n b 24 received all information regardingfor the studentnew loan borrower, u [ the account of the student loan borrowerservicer; and the student .223854.3 - 19 - education loan of the student loan borrower, including the repayment status of the student loan borrower and any benefits associated with the student education loan of the student loan borrower.
TheF. director may investigate these policies and procedures;
a student loan servicer that obtains the right to service a student education loan shall adopt policies and G.procedures to verify that the student loan servicer has received all information regarding the student loan borrower, the account of the student loan borrower and the student education loan of the student loan borrower, including the repayment status of the student loan borrower and any benefits associated with the student education loan of the student loan borrower.
aThe studentdirector loanmay servicerinvestigate shallthese informpolicies theand studenth loanprocedures; borrower about the availability of a repayment program based on income prior to placing the borrower in forbearance or default, if a repayment program based on income is available to the borrower.
SECTIONand 10.g o t hr G.
[NEWa MATERIAL]student STUDENTloan LOANservicer SERVICERS--shall PROHIBITEDinform ACTS--UNFAIRthe TRADEstudent PRACTICE--LIABILITY.--g A.e i k loan borrower about the availability of a repayment program h r i s based on income prior to placing the borrower in forbearance or h , t, default, if a repayment program based on income is available to e u g e b l e e h the borrower.
n d d i = = o h SECTION 10.
[NEW MATERIAL ] STUDENT LOAN SERVICERS-- l ] b ,d i a º e PROHIBITED ACTS--UNFAIR TRADE PRACTICE--LIABILITY.-- r i = r t e w d m a n o A.
(1)d directlym or: indirectly employ a scheme, device or artifice to defraud or mislead a student loan borrower;
b e td 17s (2)º engageo int an unfair or deceptive trade w l n d 18 practice or unconscionable trade practice toward a person or = =.223854.3AIC 19February a1, l2023 misrepresent(12:08pm) ors omitk materialm information in connection with i a e r- 20 the- servicinge of a studentn educatione loan,d includingr ae tl mu m[ 21A misrepresentingd the(1) amount,directly nature or termsindirectly ofemploy a feescheme, ordevice payment d r e 22 due or claimedartifice to bedefraud dueor onmislead a student education loan, the terms c e s k 23 and conditions of the loan agreementborrower; or the student loan e a n b 24 borrower's obligations under the loan;
u(2) [ (3) engage in abusivean actsunfair or practicesdeceptive whentrade .223854.3practice -or 20unconscionable -trade practice toward a person or misrepresent or omit material information in connection with the servicing of a student education loan.loan, including misrepresenting the amount, nature or terms of a fee or payment due or claimed to be due on a student education loan, the terms and conditions of the loan agreement or the student loan borrower's obligations under the loan;
(3) engage in abusive acts or practices when servicing a student education loan.
(a) material interference with the ability of a student loan borrower to understand a term or h condition of a student education loan;
or u » r (b) taking unreasonable advantage of any t h g e l i of the following:
1) a lack of understanding on the part of a h r i s student loan borrower of the material risks, costs or h , e h conditions of the student education loan;
2) the inability of a t u g e b l e e , gh student loan borrower to protect the borrower's interests when n d d i = = o h selecting or using a student education loan or a feature, term l ] b ,d i a º r or condition of a student education loan;
or 3) the reasonable reliancee byr the= studentt loane borrowerw ond m a personn engagedo inreliance servicingby athe student education loan toborrower acton ina theperson interestsengaged ofin thed borrower;m :
(4)b obtainr propertye byt fraudº oro t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e t- 1721 misrepresentation;- e a n e d r e l u [ A d servicing a student education loan to act in the interests of the borrower;
w(4) lobtain nproperty dby 18fraud (5)or misapplymisrepresentation; student education loan payments = = 19 a l to the outstanding balance of a student education loan;
i(5) amisapply estudent reducation 20loan (6)payments provideto inaccuratethe informationoutstanding tobalance aof credit a tstudent meducation mloan; 21 bureau;
d(6) rprovide einaccurate 22 (7) fail to report a favorable or unfavorable c e s k 23 payment history of a student loan borrower to a nationally e a n b 24 recognized consumer credit bureau at least annually if the u [ student loan servicer regularly reports information to a credit .223854.3 - 21 - bureau;
(7) fail to report a favorable or unfavorable payment history of a student loan borrower to a nationally recognized consumer credit bureau at least annually if the student loan servicer regularly reports information to a credit bureau;
h provided that the student loan servicer may adopt procedures u » r reasonably related to verifying that the representative is t h g e l i authorized to act on behalf of the student loan borrower;
h r i s (9) negligently make a false statement or h , e h knowingly and willfully make an omission of a material fact in t u g e b l e e , gh connection with any information or report filed with a n d d i = = o h governmental agency or in connection with an investigation l ] b ,d i a º r conducted by the director or another governmental agency;
(10)e failr to= properlyt evaluatee aw studentd loanm borrower for an income-driven or other student loan repayment program or for eligibility for a public service loan forgiveness program before placing the student loan borrower in e t 17 forbearance or default, if an income-driven repayment or other w l n do 18(10) programfail is available to theproperly studentevaluate loan borrower except as = = 19 a l otherwise provided in federal law, federal student loan id a e r 20 agreements or a contract between the federal government and a a t m m: 21 student loan servicer;
db r e 22t (11)º failo tot respondn within= fifteen.223854.3AIC daysFebruary to1, c2023 e(12:08pm) s k 23m communicatione from- the22 - e a n e d r e l u [ A d borrower for an income-driven or other student loan ombudsman,repayment program or withinfor aeligibility efor a npublic bservice 24loan shorterforgiveness reasonableprogram timebefore asplacing the student loan ombudsmanborrower mayin uforbearance [or requestdefault, if an income-driven repayment or other program is available to the student loan borrower except as otherwise provided in federal law, federal student loan agreements or a contract between the communication;federal government and a student loan servicer;
or(11) .223854.3 - 22 - (12) fail to respond within fifteen days to acommunication from the student loan borrowerombudsman, complaintor submittedwithin toa theshorter servicerreasonable bytime as the student loan ombudsman.ombudsman may request in the communication;
Ifor necessary,(12) afail studentto loanrespond servicerwithin mayfifteen requestdays additionalto time,a upstudent toloan forty-fiveborrower days,complaint assubmitted longto as the requestservicer is accompanied by anthe explanationstudent ofloan whyombudsman. additional time is reasonable and necessary.
If necessary, a student loan servicer may request additional time, up to forty-five days, as h long as the request is accompanied by an explanation of why u » r additional time is reasonable and necessary.
t h g e l i B.
A violation of this section is an unfair or h r i s deceptive trade practice or an unconscionable trade practice h , e h pursuant to the Unfair Practices Act and is subject to the t u g e b l e e , gh enforcement and penalty provisions contained in that act.
n d d i = = o h SECTION 11.
[NEW MATERIAL ] DISABILITY DISCHARGE.-- l ] b ,d i a º r A.
For a private education loan issued or executed e r = t e w d m a n o on or after the effective date of the Student Loan Bill of d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 23 - e a n e d r e l u [ A d Rights Act, a private education lender or student loan servicer acting on behalf of a private education lender, when notified of the total and permanent disability of a student loan borrower or cosigner, shall release any cosigner from the obligations under a private education loan.
The lender shall not attempt to collect a payment from a cosigner upon notice of total and permanent disability of the cosigner or borrower.
A violationlender ofshall thisnotify sectiona isstudent anloan unfairborrower orand deceptivecosigner tradefor practicea orprivate aneducation unconscionableloan tradeif practiceeither pursuantthe tocosigner theor Unfairborrower Practicesis Actreleased andfrom isthe subjectobligations toof the enforcementprivate andeducation penaltyloan provisionsunder containedthis insection thatwithin act.thirty days of the release.
SECTIONC. 11.
[NEWAny MATERIAL]lender DISABILITYthat DISCHARGE.--extends A.a private education loan shall provide the student loan borrower an option to designate an individual to have the legal authority to act on behalf of the borrower with respect to the private education loan in the h event of the total and permanent disability of the borrower.
Foru a» privater educationD. loan issued or executed on or after the effective date of the Student Loan Bill of Rights Act, a private education lender or student loan servicer acting on behalf of a private education lender, when notified of the total and permanent disability of a student loan e t 17 borrower or cosigner, shall release any cosigner from the w l n d 18 obligations under a private education loan.
TheIn lenderthe shallevent =a =cosigner 19is areleased lfrom notthe attemptt toh collectg ae paymentl fromi obligations of a cosignerprivate uponeducation noticeloan ofpursuant ito aSubsection eh r 20i totals andA permanentof disabilitythis ofsection, the lender shall not require the student h , e h loan borrower to obtain another cosigner oron borrower.the loan t u g e b l e e , gh obligation.
an td md mi 21= B.= o h E.
AIn lenderthe shallevent notify a studentcosigner loanis borrowerreleased dfrom rthe el 22] andb cosigner,d fori a privateº educationr loanobligations ifof eithera theprivate ceducation eloan spursuant kto 23Subsection cosignere orr borrower= ist releasede fromw thed obligationsm of the e a n bo 24A privateof educationthis loansection, undera thislender sectionshall withinnot thirtydeclare daysa ofdefault uor [d them release.:
.223854.3b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 2324 - C.e a n e d r e l u [ A d accelerate the debt against the student loan borrower on the sole basis of the release of the cosigner from the loan obligation.
AnyF. lender that extends a private education loan shall provide the student loan borrower an option to designate an individual to have the legal authority to act on behalf of the borrower with respect to the private education loan in the event of the total and permanent disability of the borrower.
D.A lender shall, when notified of the total and permanent disability of a student loan borrower, discharge the liability of the borrower and cosigner on the loan.
InG. the event a cosigner is released from the obligations of a private education loan pursuant to Subsection A of this section, the lender shall not require the student loan borrower to obtain another cosigner on the loan obligation.
E.After receiving a notification described in Subsection F of this section, the lender shall not attempt to collect on the outstanding liability of the student loan borrower or cosigner or monitor the disability status of the borrower at any point after the date of discharge.
InSECTION the12. event a cosigner is released from the obligations of a private education loan pursuant to Subsection A of this section, a lender shall not declare a default or accelerate the debt against the student loan borrower on the sole basis of the release of the cosigner from the loan obligation.
e[NEW tMATERIAL 17] F.AVAILABILITY OF ALTERNATIVE REPAYMENT OPTIONS.-- A.
AIf lendera shall,private wheneducation notifiedlender ofoffers theany totalstudent andloan wborrower lflexible nor dmodified 18repayment permanentoptions disabilityin ofconnection with a studentprivate loaneducation borrower,loan, dischargethose theflexible =h =repayment 19options ashall lbe liabilitymade available to all borrowers of theg borrowero andt cosignerhr onloans by the loan.lender.
i a e r 20 G.
After receiving a notification described in a t m m 21 Subsection F of this section, the lender shall not attempt to d r e 22 collect on the outstanding liability of the student loan c e s k 23 borrower or cosigner or monitor the disability status of the e a n b 24 borrower at any point after the date of discharge.
u [ SECTION 12.
[NEW MATERIAL] AVAILABILITY OF ALTERNATIVE .223854.3 - 24 - REPAYMENT OPTIONS.-- A.
If a private education lender offers any student loan borrower flexible or modified repayment options in connection with a private education loan, those flexible repayment options shall be made available to all borrowers of loans by the lender.
g e i k (1) provide on its website a description of h r i s any alternative repayment options offered by the lender for h , t, private education loans;
and e u g e b l e e h (2) establish policies and procedures and n d d i = = o h implement them consistently in order to facilitate evaluation ofl private] educationb loan,d flexiblei repaymenta optionº requests,e includingof providing accurate information regarding any private education loan alternativeflexible repayment optionsoption thatrequests, mayr bei available= tor thet studente loanw borrowerd throughm thea promissoryn noteo orincluding thatproviding mayaccurate haveinformation beenregarding marketedany toprivate thed borrowerm through: e t 17 marketing materials.
wb le d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 25 - e a n e d 18r B.e l u [ A d education loan alternative repayment options that may be available to the student loan borrower through the promissory note or that may have been marketed to the borrower through marketing materials.
A private education lender or a student loan = = 19 a l servicer acting on behalf of a private education lender shall i a e r 20 consistently present and offer flexible or modified private a t m m 21 education loan repayment options to student loan borrowers with d r e 22 similar financial circumstances if the lender offers such c e s k 23 repayment options.
e a n b 24 SECTION 13.
[NEW MATERIAL] NOTICES REQUIRED AT u [ ORIGINATION.-- .223854.3 - 25 - A.
Prior to the extension of a private education loan that requires a cosigner, a private education lender shall deliver the following information to the cosigner:
(1) how the private education loan obligation shall appear on the cosigner's credit;
(2) how the cosigner shall be notified if the private education loan becomes delinquent, including how the cosigner can cure the delinquency in order to avoid negative credit furnishing and loss of cosigner release eligibility;
and (3) eligibility for release of the cosigner's obligation on the private education loan, including the number of on-time payments and any other criteria required to approve the release of the cosigner from the loan obligation.
PriorA toprivate offeringeducation alender personor a privatestudent education loan thatservicer isacting beingon usedbehalf toof refinance an existing education loan, a private education lender shall provideconsistently thepresent personand aoffer eflexible tor 17modified disclosureprivate thateducation benefitsloan andrepayment protectionsoptions applicable to thestudent wloan lborrowers nwith dsimilar 18financial existingcircumstances loanif maythe belender lostoffers duesuch torepayment theoptions. refinancing.
=SECTION =13. 19 a l C.
The[NEW informationMATERIAL provided] pursuantNOTICES toREQUIRED thisAT iORIGINATION.-- aA. e r 20 section shall be provided on a one-page information sheet in a a t m m 21 twelve-point font and shall be written in simple, clear, d r e 22 understandable and easily readable language as provided in c e s k 23 P.L.1980, c.125 (C.56:12-1 et seq.).
ePrior to the extension of a nprivate beducation 24loan SECTIONthat 14.requires a cosigner, a private education lender shall deliver the following information to the cosigner:
[NEW(1) MATERIAL]how COSIGNERthe RELEASE.--private ueducation [loan A.obligation h shall appear on the cosigner's credit;
Foru any» privater education(2) loanhow thatthe obligatescosigner ashall .223854.3be -notified 26if -the cosigner,t ah lenderg shalle providel thei studentprivate education loan borrowerbecomes anddelinquent, theincluding cosignerhow anthe annualh writtenr noticei containings information about cosigner release,can includingcure the administrative,delinquency non-judgmentalin criteriaorder the lender requires to approveavoid thenegative releaseh of, thee cosignerh fromcredit thefurnishing loan obligation and theloss processof for applying for cosigner release.release eligibility;
B.and t u g e b l e e , gh (3) eligibility for release of the cosigner's n d d i = = o h obligation on the private education loan, including the number l ] b ,d i a º r of on-time payments and any other criteria required to approve e r = t e w d m a n o the release of the cosigner from the loan obligation.
Ifd them student: loan borrower has met the applicable payment requirement to be eligible for cosigner release, the lender shall send the borrower and the cosigner a written notification by mail and by electronic mail, where a borrower or cosigner has elected to receive electronic communications from the lender, informing the borrower and cosigner that the payment requirement to be eligible for cosigner release has been met.
Theb notificationr shalle alsot includeº informationo aboutt anyn additional= criteria.223854.3AIC toFebruary qualify1, for2023 cosigner(12:08pm) releases andk them proceduree to- apply26 for- cosignere a n e td 17r release.e l u [ A d B.
wPrior lto noffering da 18person C.a private education loan that is being used to refinance an existing education loan, a private education lender shall provide the person a disclosure that benefits and protections applicable to the existing loan may be lost due to the refinancing.
AC. lender shall provide written notice to a = = 19 a l student loan borrower who applies for cosigner release but i a e r 20 whose application is incomplete.
The writteninformation noticeprovided shallpursuant ato tthis msection mshall 21be includeprovided on a descriptionone-page of the information neededsheet toin considera thetwelve-point dfont rand eshall 22be applicationwritten completein andsimple, theclear, dateunderstandable byand whicheasily thereadable applicantlanguage shallas cprovided ein sP.L.1980, kc.125 23(C.56:12-1 furnishet theseq.). missing information.
eSECTION a14. n b 24 D.
Within[NEW thirtyMATERIAL days] afterCOSIGNER aRELEASE.-- studentA. loan borrower u [ submits a completed application for cosigner release, the .223854.3 - 27 - lender shall send the borrower and cosigner a written notice that informs the borrower and cosigner whether the cosigner release application has been approved or denied.
IfFor theany lenderprivate denieseducation loan that obligates a requestcosigner, fora cosignerlender release,shall provide the student loan borrower mayand requestthe anycosigner documentsan orannual informationwritten usednotice incontaining theinformation determination,about cosigner release, including the creditadministrative, scorenon-judgmental thresholdcriteria usedthe bylender therequires lender,to approve the borrower'sh consumerrelease report,of the borrower'scosigner creditfrom scorethe loan obligation and anythe otheru documents» specificr toprocess thefor borrower.applying for cosigner release.
Thet lenderh shallg alsoe providel anyi adverseB. action notices required under applicable federal law if the denial is based in whole or in part on any information contained in a consumer report.
E.If the student loan borrower has met the h r i s applicable payment requirement to be eligible for cosigner h , e h release, the lender shall send the borrower and the cosigner a t u g e b l e e , gh written notification by mail and by electronic mail, where a n d d i = = o h borrower or cosigner has elected to receive electronic l ] b ,d i a º r communications from the lender, informing the borrower and e r = t e w d m a n o cosigner that the payment requirement to be eligible for d m :
Inb responser toe at writtenº oro oralt requestn for= cosigner.223854.3AIC release,February 1, 2023 (12:08pm) s k m e - 27 - e a lendern shalle provided ther informatione describedl inu Subsection[ BA ofd thiscosigner section.release has been met.
The notification shall also include information about any additional criteria to qualify for cosigner release and the procedure to apply for cosigner release.
C.
A lender shall provide written notice to a student loan borrower who applies for cosigner release but whose application is incomplete.
The written notice shall include a description of the information needed to consider the application complete and the date by which the applicant shall furnish the missing information.
D.
Within thirty days after a student loan borrower submits a completed application for cosigner release, the lender shall send the borrower and cosigner a written notice that informs the borrower and cosigner whether the cosigner release application has been approved or denied.
If the lender denies a request for cosigner release, the student loan h borrower may request any documents or information used in the u » r determination, including the credit score threshold used by the t h g e l i lender, the borrower's consumer report, the borrower's credit h r i s score and any other documents specific to the borrower.
The h , e h lender shall also provide any adverse action notices required t u g e b l e e , gh under applicable federal law if the denial is based in whole or n d d i = = o h in part on any information contained in a consumer report.
l ] b ,d i a º r E.
In response to a written or oral request for e r = t e w d m a n o cosigner release, a lender shall provide the information d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 28 - e a n e d r e l u [ A d described in Subsection B of this section.
A lender shall not impose any restriction that permanently bars a student loan borrower from qualifying for e t 17 cosigner release, including restricting the number of times a w l n d 18 borrower may apply for cosigner release.
= = 19 a l G.
A lender shall not impose any negative i a e r 20 consequences on any student loan borrower or cosigner during a t m m 21 the sixty days following the issuance of the notice required d r e 22 pursuant to Subsection C of this section, or until the lender c e s k 23 makes a final determination about a borrower's cosigner release e a n b 24 application.
For the purpose of this subsection, "negative u [ consequences" includes the imposition of additional eligibility .223854.3 - 28 - criteria, negative credit reporting, lost eligibility for cosigner release, late fees, interest capitalization or other financial injury.
For a private education loan issued or executed h on or after the effective date of the Student Loan Bill of u » r Rights Act, a lender shall not require more than twelve t h g e l i consecutive on-time payments as criteria for cosigner release.
h r i s Any student loan borrower who has paid the equivalent of twelve h , e h months of principal and interest payments within any twelve- t u g e b l e e , gh month period shall be considered to have satisfied the n d d i = = o h consecutive on-time payment requirement, even if the borrower l ] b ,d i a º r has not made payments monthly during the twelve-month period.
e r = t e w d m a n o I.
If a student loan borrower or cosigner requests a change in terms that restarts the count of consecutive on-time payments required for cosigner release, the lender shall notify the borrower and cosigner in writing of the impact e t 17 of the change and provide the borrower or cosigner the right to w l n d 18m withdraw: or reverse the request to avoid that impact.
=b r e t º o t n = 19.223854.3AIC February 1, 2023 (12:08pm) s k m e - 29 - e a n e d r e l J.u [ A d a change in terms that restarts the count of consecutive on-time payments required for cosigner release, the lender shall notify the borrower and cosigner in writing of the impact of the change and provide the borrower or cosigner the right to withdraw or reverse the request to avoid that impact.
AJ. student loan borrower shall have the right to i a e r 20 request an appeal of a lender's determination to deny a request a t m m 21 for cosigner release, and the lender shall permit the borrower d r e 22 to submit additional documentation evidencing the borrower's c e s k 23 ability, willingness and stability to meet the payment e a n b 24 obligations.
TheA student loan borrower mayshall have the right to request reviewan appeal of ua [lender's thedetermination to deny a request for cosigner releaserelease, determinationand bythe anotherlender employee.shall permit the borrower to submit additional documentation evidencing the borrower's ability, willingness and stability to meet the payment obligations.
.223854.3The -student 29loan -borrower K.may request review of the cosigner release determination by another employee.
AK. lender shall establish and maintain a comprehensive record management system reasonably designed to ensure the accuracy, integrity and completeness of data and other information about cosigner release applications and to ensure compliance with applicable state and federal laws, including the federal Equal Credit Opportunity Act and the federal Fair Credit Reporting Act.
ThisA systemlender shall includeestablish and maintain a comprehensive record management system reasonably designed to ensure the numberaccuracy, integrity and completeness of data and other information about cosigner release applications received,and theto approvalh ensure compliance with applicable state and denialfederal ratelaws, u » r including the federal Equal Credit Opportunity Act and the primaryt reasonsh forg anye denial.l i federal Fair Credit Reporting Act.
SECTIONThis 15.system shall include h r i s the number of cosigner release applications received, the h , e h approval and denial rate and the primary reasons for any t u g e b l e e , gh denial.
[NEWn MATERIAL]d INFORMATIONd AVAILABLEi TO= COSIGNERS.--= A.o h SECTION 15.
A[NEW lenderMATERIAL shall] provideINFORMATION aAVAILABLE cosignerTO withl access] tob all,d documentsi ora recordsº relatedr toCOSIGNERS.-- thee cosignedr private= educationt loane thatw ared availablem toa then studento loanA. borrower.
A lender shall provide a cosigner with access to d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 30 - e a n e d r e l u [ A d all documents or records related to the cosigned private education loan that are available to the student loan borrower.
If a lender provides electronic access to e t 17 documents and records for a student loan borrower, the lender w l n d 18 shall provide equivalent electronic access to the cosigner.
= = 19 a l C.
Upon written notice from the student loan i a e r 20 borrower or cosigner, the lender shall redact or withhold a t m m 21 contact information for the borrower and cosigner.
d r e 22 SECTION 16.
[NEW MATERIAL] PROHIBITIONS ON THE c e s k 23 ACCELERATION OF PRIVATE EDUCATION LOANS.-- e a n b 24 A.
A private education loan executed on or after u [ the effective date of the Student Loan Bill of Rights Act shall .223854.3 - 30 - not include a provision that permits the private education lender to accelerate, in whole or in part, payments on the private education loan, except in cases of payment default.
A lender shall not place any loan or account into default or accelerate a loan for any reason, other than for payment default.
B.
A private education loan executed prior to the effective date of the Student Loan Bill of Rights Act shall permit the lender to accelerate payments only if the promissory note or loan agreement explicitly authorizes an acceleration and only for the reasons stated in the note or agreement.
InUpon thewritten eventnotice offrom the deathstudent ofloan aborrower or cosigner, the lender shall notredact attemptor towithhold collectcontact againstinformation for the cosigner'sborrower estate,and othercosigner. than for payment default.
SECTION 16.
[NEW MATERIAL ] PROHIBITIONS ON THE ACCELERATION OF PRIVATE EDUCATION LOANS.-- A.
A private education loan executed on or after the effective date of the Student Loan Bill of Rights Act shall not include a provision that permits the private education lender to accelerate, in whole or in part, payments on the private education loan, except in cases of payment default.
A lender shall not place any loan or account into default or h accelerate a loan for any reason, other than for payment g o t hr default.
g e i k B.
A private education loan executed prior to the h r i s effective date of the Student Loan Bill of Rights Act shall h , t, permit the lender to accelerate payments only if the promissory e u g e b l e e h note or loan agreement explicitly authorizes an acceleration n d d i = = o h and only for the reasons stated in the note or agreement.
l ] b ,d i a º e C.
In the event of the death of a cosigner, the r i = r t e w d m a n o lender shall not attempt to collect against the cosigner's d m :
b e d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 31 - e a n e d r e l u [ A d estate, other than for payment default.
Upon receiving notification of the death or bankruptcy of a cosigner, when the private education loan is e t 17 not more than sixty days delinquent at the time of the w l n d 18 notification, the lender shall not change any terms or benefits = = 19 a l under the promissory note, repayment schedule, repayment terms i a e r 20 or monthly payment amount or any other provision associated a t m m 21 with the private education loan.
d r e 22 E.
A lender shall not place any private loan or c e s k 23 account into default or accelerate a private loan while a e a n b 24 borrower is seeking a private loan modification or enrollment u [ in a flexible repayment plan, except that a lender may place a .223854.3 - 31 - private loan or account into default or accelerate a private loan for payment default ninety days following the student loan borrower's default.
[NEW MATERIAL]MATERIAL ] PRIVATE EDUCATION LENDERS-- h PROHIBITED ACTS.-- g o t hr A.
g e i k (1) offer any private education loan that is h r i s not in conformity with the Student Loan Bill of Rights Act or h , t, that is in violation of any other state or federal law;
e u g e b l e e h (2) make a private education loan upon n d d i = = o h security of any assignment of or order for the payment of any l ] b ,d i a º e salary, wages, commissions or other compensation for services r i = r t e w d m a n o earned or to be earned.
No assignment or order shall be taken byd am lender: in connection with a private education loan, or for the enforcement or repayment thereof, and any assignment or order taken or given to secure any loan made by any lender e t 17 under the Student Loan Bill of Rights Act shall be void;
wb le d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 32 - e a n e d 18r (3)e directlyl oru indirectly[ employA d by a scheme,lender =in =connection 19with a lprivate deviceeducation loan, or artificefor tothe defraudenforcement or misleadrepayment athereof, studentand any assignment or order taken or given to secure any loan imade aby eany rlender 20under borrowerthe orStudent cosigner;Loan Bill of Rights Act shall be void;
a(3) tdirectly m m 21 (4) engage in an unfair or deceptiveindirectly tradeemploy d r e 22 practice or unconscionable trade practice toward a personscheme, ordevice c e s k 23 misrepresent or omitartifice materialto informationdefraud in connection with e a n b 24 the lending or servicingmislead of a private education loan, including u [ misrepresenting the amount, nature or terms of a fee or payment .223854.3 - 32 - due or claimed to be due on a private education loan, the terms and conditions of the loan agreement or the student loan borrower'sborrower or cosigner'scosigner; obligations under the loan;
(5)(4) engage in abusivean actsunfair or practicesdeceptive whentrade practice or unconscionable trade practice toward a person or misrepresent or omit material information in connection with the lending or servicing of a private education loan.loan, including misrepresenting the amount, nature or terms of a fee or payment due or claimed to be due on a private education loan, the terms and conditions of the loan agreement or the student loan borrower's or cosigner's obligations under the loan;
An(5) engage in abusive actacts or practicepractices includes:when h lending or servicing a private education loan.
(a)An materialabusive interferenceact withu the» abilityr of a student loan borrower or cosignerpractice toincludes: understand a term or condition of a private education loan;
ort (b)h takingg unreasonablee advantagel i (a) material interference with the h r i s ability of anya student loan borrower or cosigner to understand a h , e h term or condition of thea following:private education loan;
aor lackt ofu understandingg one theb partl ofe ae student, loangh borrower(b) ortaking cosignerunreasonable advantage of theany materialn risks,d costsd ori conditions= of= theo privateh educationof loan;the following:
a lack of understanding on the inabilitypart of a l ] b ,d i a º r student loan borrower or cosigner toof protect the borrower'smaterial orrisks, cosigner'scosts interestse whenr selecting= ort usinge aw privated educationm loan or a feature,n termo or conditionconditions of athe private e t 17 education loan;
or the reasonableinability reliance by the student loan w l n d 18 borrower or cosigner on a person engaged in lending or = = 19 a l servicing a private education loan to act in the interests of i a ed rm 20: the borrower or cosigner;
ab r e t mº o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m 21e (6)- obtain33 property- bye frauda orn e d r e 22l misrepresentation;u [ A d student loan borrower or cosigner to protect the borrower's or cosigner's interests when selecting or using a private education loan or a feature, term or condition of a private education loan;
cor ethe sreasonable kreliance 23by (7)the misapplystudent privateloan educationborrower loanor paymentscosigner eon a nperson bengaged 24in lending or servicing a private education loan to theact outstandingin balancethe interests of athe studentborrower educationor loan;cosigner;
u(6) [obtain (8)property provideby inaccuratefraud informationor tomisrepresentation; a credit .223854.3 - 33 - bureau;
(9)(7) failmisapply toprivate reporteducation aloan favorablepayments orto unfavorablethe paymentoutstanding historybalance of a student loan borrower or cosigner to a nationally recognized consumer credit bureau at least annually if the private education lenderloan; regularly reports information to a credit bureau;
(10)(8) refuseprovide toinaccurate communicateinformation withto an authorized representative of a studentcredit loanbureau; borrower or cosigner who provides a written authorization signed by the student loan borrower;
provided(9) thatfail theto privatereport educationa lenderfavorable mayor adoptunfavorable procedurespayment reasonablyhistory relatedof a student loan borrower or cosigner to verifyinga thatnationally therecognized representativeconsumer iscredit authorizedbureau toat actleast onannually behalfh ofif the studentprivate loaneducation borrower;lender regularly reports information u » r to a credit bureau;
(11)t negligentlyh makeg ae falsel statementi or(10) knowinglyrefuse andto willfullycommunicate makewith an omissionauthorized ofh ar materiali facts inrepresentative connectionof witha anystudent informationloan borrower or reportcosigner filedwho withh a, e th 17provides governmentala agencywritten orauthorization insigned connectionby withthe anstudent investigationloan wt lu ng de 18b conductedl bye thee director, orgh anotherborrower; governmental agency;
=provided =that 19the aprivate leducation (12)lender failmay toadopt respondn withind fifteend daysi to= i= ao eh rprocedures 20reasonably communicationrelated fromto verifying that the studentl loan] ombudsman,b or,d withini a aº tr mrepresentative mis 21authorized shorterto reasonableact timeon asbehalf of the student loane ombudsmanr may= dt r e 22w requestd inm thea communication;n o loan borrower;
ord cm e: s k 23 (13) fail to respond within fifteen days to a e a n b 24 student loan borrower or cosigner complaint submitted to the u [ lender by the student loan ombudsman.
Ifb necessary,r ae privatet .223854.3º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 34 - educatione lendera mayn requeste additionald time,r upe tol forty-fiveu days,[ asA longd as(11) thenegligently requestmake isa accompaniedfalse bystatement or knowingly and willfully make an explanationomission of whya additionalmaterial timefact isin reasonableconnection andwith necessary.any information or report filed with a governmental agency or in connection with an investigation conducted by the director or another governmental agency;
(12) fail to respond within fifteen days to communication from the student loan ombudsman, or within a shorter reasonable time as the student loan ombudsman may request in the communication;
or (13) fail to respond within fifteen days to a student loan borrower or cosigner complaint submitted to the lender by the student loan ombudsman.
If necessary, a private education lender may request additional time, up to forty-five days, as long as the request is accompanied by an explanation of why additional time is reasonable and necessary.
A violation of this section is an unfair or h deceptive trade practice or an unconscionable trade practice g o t hr pursuant to the Unfair Practices Act and is subject to the g e i k enforcement and penalty provisions contained in that act.
h r i s SECTION 18.
[NEW MATERIAL]MATERIAL ] MARKET MONITORING.-- h , t, A.
The director may monitor for risks to consumers e u g e b l e e h in the provision of student loan servicing and student n d d i = = o h education loans, including private education loans in New l ] b ,d i a º e Mexico and developments in the market for those services, by r i = r t e w d m a n o compiling and analyzing data and other information based on any ofd them following: considerations:
(1)b thee likelyd riskss andº costso tot consumersn associated= with.223854.3AIC usingFebruary or1, repaying2023 (12:08pm) s k m e - 35 - e a studentn educatione loand orr e tl 17u with[ theA servicingd of athe studentfollowing educationconsiderations: loan;
w(1) lthe nlikely drisks 18and (2)costs theto understanding by consumers ofassociated thewith =using =or 19repaying a l risks of a student education loan or with the servicing of a student i a e r 20 education loan;
a(2) t m m 21 (3) the legalunderstanding protectionsby applicableconsumers toof the drisks r e 22 offering or provision of a student education loan or the c e s k 23 servicing of a student education loan,loan; including the extent to e a n b 24 which the law is likely to adequately protect consumers;
u(3) [ (4) the rateslegal ofprotections growthapplicable into the offering or .223854.3 - 35 - provision of a student education loan or the servicing of thata loan;student education loan, including the extent to which the law is likely to adequately protect consumers;
(5)(4) the extent,rates ifof any,growth toin which the risksoffering or provision of a student education loan or the servicing of athat studentloan; education loan disproportionately affect traditionally underserved consumers;
and(5) (6) the type,extent, numberif andany, otherto pertinentwhich characteristicsthe risks of privatea student education lendersloan andor the servicing of a student h education loan servicersdisproportionately inaffect Newtraditionally Mexico.u » r underserved consumers;
B.and t h g e l i (6) the type, number and other pertinent h r i s characteristics of private education lenders and student loan h , e h servicers in New Mexico.
Int conductingu monitoringg ore assessmentb authorizedl bye thise section,, thegh directorB. may gather information regarding the organization, business conduct, markets and activities of private education lenders and student loan servicers in New Mexico, except if that private education lender or student loan servicer is a national bank as defined in 12 U.S.C.
SectionIn 25b,conducting andmonitoring onlyor toassessment then extentd thatd thei e= t= 17o requirementsh ofauthorized by this subsectionsection, arethe preempteddirector withmay respectgather toinformation l ] b ,d i a º r regarding the organization, business conduct, markets and e r = t e w ld m a n do 18activities nationalof banksprivate pursuanteducation tolenders 12and U.S.C.student loan d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 36 - e a n e d r e l u [ A d servicers in New Mexico, except if that private education lender or student loan servicer is a national bank as defined in 12 U.S.C.
Section 25b, and only to the extent that the requirements of this subsection are preempted with respect to national banks pursuant to 12 U.S.C.
The = = 19 a l director may enter into contracts to perform the duties i a e r 20 required by this section, as necessary.
a t m m 21 C.
In order to gather information described in d r e 22 Subsection B of this section, the director may do the c e s k 23 following:
e a n b 24 (1) gather and compile information from a u [ variety of sources, including consumer complaints, voluntary .223854.3 - 36 - surveys and voluntary interviews of consumers, surveys and interviews with private education lenders and student loan servicers and service providers, and review of available databases;
and h (2) require persons engaged in private u » r education lending or student loan servicing and subject to the t h g e l i Student Loan Bill of Rights Act to file, under oath or h r i s otherwise, in the form and within a reasonable period of time h , e h as the director may prescribe, annual or special reports, or t u g e b l e e , gh answers in writing to specific questions, as necessary for the n d d i = = o h director to fulfill the monitoring, assessment and reporting l ] b ,d i a º r responsibilities set forth in this section.
e r = t e w d m a n o D.
In addition to any other market monitoring activities deemed necessary by the director pursuant to Subsection A of this section, the division may gather and compile information from private education lenders and student e t 17 loan servicers to assemble data that assesses the total size of w l n d 18 the student loan market in New Mexico, the servicing of loans = = 19 a l owed by borrowers at risk of default, the servicing of private i a e r 20 education loans owed by borrowers experiencing financial a t m m: 21 distress and the servicing of federal student education loans d r e 22 for borrowers who seek to repay their loans under an c e s k 23 income-driven repayment plan as described in Section 1070 et e a n b 24 seq.
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 37 - e a n e d r e l u [ A d activities deemed necessary by the director pursuant to Subsection A of this section, the division may gather and compile information from private education lenders and student loan servicers to assemble data that assesses the total size of the student loan market in New Mexico, the servicing of loans owed by borrowers at risk of default, the servicing of private education loans owed by borrowers experiencing financial distress and the servicing of federal student education loans for borrowers who seek to repay their loans under an income-driven repayment plan as described in Section 1070 et seq.
u [ E.
The director may, on a quarterly basis, develop .223854.3 - 37 - and publicize metrics based on data collected pursuant to this section, and those metrics may identify each private education lender and student loan servicer and publish relevant metrics related to performance of each such persons.
In executing the h function described in this section, the director may meet and u » r confer with the student loan ombudsman, the office of the t h g e l i attorney general and the higher education department.
h r i s F.
To fulfill the monitoring and assessment h , e h authorized by this section and to carry out the purposes of t u g e b l e e , gh this section, the director may:
n d d i = = o h (1) retain attorneys, accountants or other l ] b ,d i a º r professionals;
(2)e enterr into= agreementst ore relationshipsw withd otherm governmenta officialsn oro regulatory(2) associationsenter tointo improveagreements efficiencies and reduce regulatory burden by sharing resources, standardized or uniformrelationships methods or procedures and e t 17 documents, records, information or evidence obtained pursuant w l n d 18m to: this section;
=b r e t º o t n = 19.223854.3AIC aFebruary l1, (3)2023 use,(12:08pm) hire,s contractk orm employe public- or38 i- e a n e d r 20e privatelyl availableu analytical[ systems,A d with other government officials or regulatory associations to improve efficiencies and reduce regulatory burden by sharing resources, standardized or uniform methods or software;procedures and documents, records, information or evidence obtained pursuant to this section;
a(3) tuse, mhire, mcontract 21or (4)employ relypublic on examination or investigationprivately davailable ranalytical esystems, 22methods reports made by other government officials, whether in or csoftware; e s k 23 outside of New Mexico;
and(4) erely aon nexamination bor 24investigation (5)reports accept audit reportings made by another ugovernment [officials, independentwhether certifiedin public accountant for the private .223854.3 - 38 - education lender, student loan servicer or personoutside subject to the Student Loan Bill of RightsNew Act.Mexico;
and (5) accept audit reportings made by an independent certified public accountant for the private education lender, student loan servicer or person subject to the Student Loan Bill of Rights Act.
[NEW MATERIAL]MATERIAL ] POWERS OF THE DIRECTOR.-- A.
The director may conduct investigations and h examinations for purposes of initial licensing, license u » r renewal, license suspension, license revocation or termination, t h g e l i or for general or specific inquiry or investigation, to h r i s determine compliance with the Student Loan Bill of Rights Act.
h , e h The director may access, receive and use any documents, t u g e b l e e , gh information or evidence the director deems relevant to the n d d i = = o h inquiry or investigation regardless of the location, l ] b ,d i a º r possession, control or custody of those documents or that e r = t e w d m a n o information or evidence.
d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 39 - e a n e d r e l u [ A d B.
For the purposes of investigating violations or complaints arising pursuant to the Student Loan Bill of Rights Act or for the purposes of examination, the director may review, investigate or examine the activities of any private education lender or student loan servicer as often as necessary to carry out the purposes of that act.
The director may direct, subpoena or order the attendance of and examine under oath a person whose testimony may be required about the student education loan or the business or subject matter of the examination or investigation and may direct, subpoena or order the person to produce books, accounts, records, files and any other documents the director deems relevant to the inquiry.
C.
In making an examination or investigation authorized by the Student Loan Bill of Rights Act, the director may control access to any documents or records of the student loan servicer licensee or person under examination or h investigation related to the student education loan.
The u » r director may take possession of the documents and records or t h g e l i place a person in exclusive charge of the documents and records h r i s in the place where the documents and records are usually kept.
h , e h During the period of control, a person shall not remove or t u g e b l e e , gh attempt to remove any of the documents and records except n d d i = = o h pursuant to a court order or with the consent of the director.
l ] b ,d i a º r Unless the director has reasonable grounds to believe the e r = t e w d m a n o documents or records of the student loan servicer licensee or d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 40 - e a n e d r e l u [ A d person have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of the Student Loan Bill of Rights Act, the student loan servicer licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct its ordinary business affairs.
Nothing in this subsection shall be construed as limiting the student loan borrower's access to the borrower's own account records.
D.
To fulfill the duties imposed by this section and to carry out the purposes of this section, the director may:
(1) retain attorneys, accountants or other professionals and specialists as examiners, auditors or investigators to conduct or assist in the conduct of examinations or investigations;
(2) enter into agreements or relationships h with other government officials or regulatory associations to u » r improve efficiencies and reduce regulatory burden by sharing t h g e l i resources, standardized or uniform methods or procedures and h r i s documents, records, information or evidence obtained pursuant h , e h to this section;
t u g e b l e e , gh (3) use, hire, contract or employ public or n d d i = = o h privately available analytical systems, methods or software to l ] b ,d i a º r examine or investigate the student loan servicer, private e r = t e w d m a n o education lender or person subject to the Student Loan Bill of d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 41 - e a n e d r e l u [ A d Rights Act;
(4) rely on examination or investigation reports made by other government officials, whether in or outside of New Mexico;
and (5) accept audit reports made by an independent certified public accountant for the student loan servicer, private education lender or person subject to the Student Loan Bill of Rights Act in the course of that part of the examination covering the same general subject matter as the audit and may incorporate the audit report in the report of examination, report of investigation or other writing of the director.
E.
A student loan servicer, private education lender or person subject to investigation or examination under this section shall not knowingly withhold, abstract, remove, mutilate, destroy or secrete any books, records, computer h records or other information.
u » r F.
The costs of an investigation or examination t h g e l i conducted by the director shall be paid by the student loan h r i s servicer, private education lender or person being h , e h investigated.
When it becomes necessary to examine or t u g e b l e e , gh investigate the books and records of a licensee under this n d d i = = o h section at a location outside of New Mexico, the licensee shall l ] b ,d i a º r be liable for and shall pay to the division within thirty days e r = t e w d m a n o of the presentation of an itemized statement the actual travel d m :
b r e t º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 42 - e a n e d r e l u [ A d and reasonable living expenses incurred on account of its examination, supervision and regulation or shall pay a reasonable per diem rate approved by the director.
SECTION 20.
[NEW MATERIAL ] ENFORCEMENT BY DIRECTOR.-- A.
To ensure the effective supervision and enforcement of the Student Loan Bill of Rights Act and in accordance with the procedures provided in the Uniform Licensing Act, the director may:
(1) deny, suspend, revoke or decline to renew a license for a violation of the Student Loan Bill of Rights Act, rules issued pursuant to that act or an order or directive entered pursuant to that act;
(2) deny, suspend, revoke or decline to renew a license if an applicant or student loan servicer fails at any time to meet the requirements of Subsection F of Section 4 of the Student Loan Bill of Rights Act;
and h (3) issue orders or directives as follows:
g o t hr (a) order or direct student loan g e i k servicers or private education lenders to cease and desist from h r i s conducting business related to student education loans, h , t, including issuing an immediate temporary order to cease and e u g e b l e e h desist;
n d d i = = o h (b) order or direct student loan l ] b ,d i a º e servicers or private education lenders to cease any violations r i = r t e w d m a n o of the Student Loan Bill of Rights Act;
and d m :
b e d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 43 - e a n e d r e l u [ A d (c) enter immediate temporary orders to cease any business licensed pursuant to the Student Loan Bill of Rights Act if the director determines that the license was erroneously granted or the licensed student loan servicer is currently in violation of that act.
ForThe thedirector purposesmay ofimpose investigatingan violationsadministrative orpenalty complaintson arisinga pursuantstudent toloan servicer if the Studentdirector Loanfinds, Billfrom ofthe Rightsrecord Actafter ornotice and opportunity for thea purposesrecorded ofhearing, examination,that the directorstudent mayloan eservicer thas 17violated review, investigate or examinefailed theto activitiescomply ofwith any privaterequirement wof lthe nStudent dLoan 18Bill educationof lenderRights Act or studentany loanrule servicerpromulgated asby oftenthe asdirector necessarypursuant =to =that 19act aor lany toorder carryissued outpursuant theto purposes of that act.
The directormaximum mayamount iof apenalty efor reach 20act direct, subpoena or orderomission theshall attendance of and examine under a t m m 21 oath a person whose testimony may be requiredfive aboutthousand thedollars student($5,000). d r e 22 education loan or the business or subject matter of the c e s k 23 examination or investigation and may direct, subpoena or order e a n b 24 the person to produce books, accounts, records, files and any u [ other documents the director deems relevant to the inquiry.
.223854.3 - 39 - C.
In making an examination or investigation authorized by the Student Loan Bill of Rights Act, the director may control access to any documents or records of the student loan servicer licensee or person under examination or investigation related to the student education loan.
The director may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where the documents and records are usually kept.
During the period of control, a person shall not remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the director.
Unless the director has reasonable grounds to believe the documents or records of the student loan servicer licensee or person have been, or are at risk of being, altered or destroyed for purposes of concealing a violation of the Student Loan Bill of Rights Act, the student loan servicer licensee or owner of e t 17 the documents and records shall have access to the documents or w l n d 18 records as necessary to conduct its ordinary business affairs.
= = 19 a l Nothing in this subsection shall be construed as limiting the i a e r 20 student loan borrower's access to the borrower's own account a t m m 21 records.
d r e 22 D.
To fulfill the duties imposed by this section c e s k 23 and to carry out the purposes of this section, the director e a n b 24 may:
u [ (1) retain attorneys, accountants or other .223854.3 - 40 - professionals and specialists as examiners, auditors or investigators to conduct or assist in the conduct of examinations or investigations;
(2) enter into agreements or relationships with other government officials or regulatory associations to improve efficiencies and reduce regulatory burden by sharing resources, standardized or uniform methods or procedures and documents, records, information or evidence obtained pursuant to this section;
(3) use, hire, contract or employ public or privately available analytical systems, methods or software to examine or investigate the student loan servicer, private education lender or person subject to the Student Loan Bill of Rights Act;
(4) rely on examination or investigation reports made by other government officials, whether in or e t 17 outside of New Mexico;
and w l n d 18 (5) accept audit reports made by an = = 19 a l independent certified public accountant for the student loan i a e r 20 servicer, private education lender or person subject to the a t m m 21 Student Loan Bill of Rights Act in the course of that part of d r e 22 the examination covering the same general subject matter as the c e s k 23 audit and may incorporate the audit report in the report of e a n b 24 examination, report of investigation or other writing of the u [ director.
.223854.3 - 41 - E.
A student loan servicer, private education lender or person subject to investigation or examination under this section shall not knowingly withhold, abstract, remove, mutilate, destroy or secrete any books, records, computer records or other information.
F.
The costs of an investigation or examination conducted by the director shall be paid by the student loan servicer, private education lender or person being investigated.
When it becomes necessary to examine or investigate the books and records of a licensee under this section at a location outside of New Mexico, the licensee shall be liable for and shall pay to the division within thirty days of the presentation of an itemized statement the actual travel and reasonable living expenses incurred on account of its examination, supervision and regulation or shall pay a reasonable per diem rate approved by the director.
e t 17 SECTION 20.
[NEW MATERIAL] ENFORCEMENT BY DIRECTOR.-- w l n d 18 A.
To ensure the effective supervision and = = 19 a l enforcement of the Student Loan Bill of Rights Act and in i a e r 20 accordance with the procedures provided in the Uniform a t m m 21 Licensing Act, the director may:
d r e 22 (1) deny, suspend, revoke or decline to renew c e s k 23 a license for a violation of the Student Loan Bill of Rights e a n b 24 Act, rules issued pursuant to that act or an order or directive u [ entered pursuant to that act;
.223854.3 - 42 - (2) deny, suspend, revoke or decline to renew a license if an applicant or student loan servicer fails at any time to meet the requirements of Subsection F of Section 4 of the Student Loan Bill of Rights Act;
and (3) issue orders or directives as follows:
(a) order or direct student loan servicers or private education lenders to cease and desist from conducting business related to student education loans, including issuing an immediate temporary order to cease and desist;
(b) order or direct student loan servicers or private education lenders to cease any violations of the Student Loan Bill of Rights Act;
and (c) enter immediate temporary orders to cease any business licensed pursuant to the Student Loan Bill of Rights Act if the director determines that the license was e t 17 erroneously granted or the licensed student loan servicer is w l n d 18 currently in violation of that act.
= = 19 a l B.
The director may impose an administrative i a e r 20 penalty on a student loan servicer if the director finds, from a t m m 21 the record after notice and opportunity for a recorded hearing, d r e 22 that the student loan servicer has violated or failed to comply c e s k 23 with any requirement of the Student Loan Bill of Rights Act or e a n b 24 any rule promulgated by the director pursuant to that act or u [ any order issued pursuant to that act.
The maximum amount of .223854.3 - 43 - penalty for each act or omission shall be five thousand dollars ($5,000).
[NEW MATERIAL]MATERIAL ] JUDICIAL ENFORCEMENT.-- A.
Upon a showing by the director that a person has h violated, or is about to violate, the Student Loan Bill of g o t hr Rights Act or any rule or order of the director pursuant to g e i k that act, the district court of the first judicial district or h r i s HECº other appropriate district court in the statestate»HEC HECºthe h , t, district court in the judicial district where the student loan e u g e b l e e h borrower or cosigner resides»HEC may grant or impose one or n d d i = = o h more of the following:
l ] b ,d i a º e (1) a temporary restraining order, permanent r i = r t e w d m a n o or temporary prohibitory or mandatory injunction or a writ of prohibitiond orm mandamus;:
b e d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 44 - e a n e d r e l u [ A d prohibition or mandamus;
(4) restitution to student loan borrowers or e t 17 cosigners;
w l n d 18 (5) recovery by the director of all costs and = = 19 a l expenses for conducting an investigation or the bringing of any i a e r 20 enforcement action pursuant to the Student Loan Bill of Rights a t m m 21 Act;
or d r e 22 (6) other relief as the court deems proper.
c e s k 23 B.
In determining the appropriate relief, the court e a n b 24 shall consider administrative enforcement actions taken and u [ imposed by the director pursuant to the Student Loan Bill of .223854.3 - 44 - Rights Act in connection with the transactions constituting violations of that act.
C.
The court shall not require the director to post bond in an action pursuant to this section.
SECTION 22.
[NEW MATERIAL] COMPLIANCE WITH FEDERAL LAW.-- A.
A student loan servicer licensee shall comply with all applicable federal laws and regulations relating to student loan servicing.
In addition to any other remedies provided by law, a violation of an applicable federal law or regulation is a violation of the Student Loan Bill of Rights Act.
In determining the appropriate relief, the court shall consider administrative enforcement actions taken and imposed by the director pursuant to the Student Loan Bill of Rights Act in connection with the transactions constituting violations of that act.
h C.
The court shall not require the director to post g o t hr bond in an action pursuant to this section.
g e i k SECTION 22.
[NEW MATERIAL ] COMPLIANCE WITH FEDERAL LAW.-- h r i s A.
A student loan servicer licensee shall comply h , t, with all applicable federal laws and regulations relating to e u g e b l e e h student loan servicing.
In addition to any other remedies n d d i = = o h provided by law, a violation of an applicable federal law or l ] b ,d i a º e regulation is a violation of the Student Loan Bill of Rights r i = r t e w d m a n o Act.
d m :
b e d s º o t n = .223854.3AIC February 1, 2023 (12:08pm) s k m e - 45 - e a n e d r e l u [ A d B.
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View plain text versions (2)
- Amended Amendments in Context Current pdf
- Introduced introduced version pdf
Action History
-
DO PASS, as amended, committee report adopted
-
Sent to House Education Committee & House Appropriations & Finance Committee
-
Sent to House Pre-file
Sponsors
- Christine Chandler · Primary
- Patricia Roybal Caballero · Primary
Sponsorship breakdown
Export CSV (upgrade) →2 sponsors · 0 co-sponsors · 110 not signed on
Sponsors (2)
- Christine Chandler Democrat
- Patricia Roybal Caballero Democrat
Co-sponsors (0)
None.
Not signed on (110)
110 members have not signed on to this bill.
Show all 110 →"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.
Subjects
Frequently asked questions
- Who sponsors HB 82?
- HB 82 is sponsored by Christine Chandler (Democrat) and Patricia Roybal Caballero (Democrat).
- What is the current status of HB 82?
- This bill died with 2023 Regular Session. It reached “In Committee” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.
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