News release: “The Consumer Financial Protection Bureau (CFPB) issued a rule today that allows the Bureau to supervise certain nonbank student loan servicers for the first time. The rule brings new oversight to the nation’s second largest consumer debt market – student loans – which have seen a rise in borrower delinquency in recent years. “Student loan borrowers should be able to rest assured that when they make a payment toward their loans, the company that takes their money is playing by the rules,” said CFPB Director Richard Cordray. “This rule brings new oversight to those large student loan servicers that touch tens of millions of borrowers.” More than 40 million Americans with student debt depend on student loan servicers to serve as their primary point of contact about their loans. Student loan servicers’ duties typically include managing borrowers’ accounts, processing monthly payments, and communicating directly with borrowers. When facing unemployment or other financial hardship, borrowers contact student loan servicers in order to enroll in alternative repayment plans, obtain deferments or forbearances, or request a modification of loan terms…
- Borrowers that have trouble with their servicers can submit a complaint. For more information, visit: http://www.consumerfinance.gov/students/.
- A copy of the rule is available here: http://files.consumerfinance.gov/f/201312_cfpb_student-servicing-rule.pdf
- A factsheet on the student loan servicing rule is available here: http://files.consumerfinance.gov/f/201312_cfpb_factsheet_student-servicing-rule.pdf
- To coincide with this new authority, the Bureau has also updated its Supervisory and Examination Manual to provide guidance on how the Bureau will monitor bank and nonbank servicers of private and federal student loans.”