CFPB Request for Comment on Private Student Lending
The Consumer Financial Protection Bureau (CFPB) has issued a notice and request for comment regarding private student loans made by credit unions and other not-for- profit and for-profit student lenders. CFPB is requesting this information in order to prepare a report to Congress
on the private student loan industry as required by section 1077 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Section 1077 requires CFPB and the Department of Education to submit by July 21, 2012, a report to Congress containing information regarding so- called “private” student loans (i.e. student loans that are not federally-guaranteed under Title IV of the Higher Education Act or made directly by the federal government), including the terms, conditions, and pricing of private education loans, private student loan underwriting criteria, the proportion
of private student loans made by not-for-profit institutions, as well as any “statutory or legislative recommendations necessary to improve consumer protections for private education loan borrowers and to better enable Federal regulators and the public to ascertain private educational lender compliance with fair lending laws.”
The CFPB notice and request for comment includes 11 questions about private student lending regarding the scope and use of private education loans, what information is available to students about these loans, how students “shop” for student loan products, and students’ ability to repay their loans. The CFPB’s notice can be accessed here.
Credit unions can submit comment letters to CFPB in response to the notice and request for comment until January 17, 2012. CUNA will be posting a Regulatory Comment Call on this issue in the near future.