CFPB Seeks Information To Support Potential Student Loan Policies


On February 21, the CFPB Student Loan Ombudsman issued a notice and request for information regarding policy options to “increase the availability of affordable payment plans for borrowers with existing private student loans.” The Ombudsman poses 16 questions related to student loan servicing and the broader impact of borrower hardship on other industries, including questions regarding: (i) scope of borrower hardship, (ii) current options for borrowers with hardship, (iii) modification programs for other types of debt, (iv) servicing infrastructure, (v) consumer reporting and credit scoring, (vi) lender participation, (vii) borrower awareness, and (viii) spillover impacts, including impacts on the auto market. The notice, which is based on recommendations contained in the Ombudsman’s October 2012 annual report and an Office of Financial Research report identifying student loan debt as a risk—though not systemic—to the broader economy, clarifies that the CFPB is not seeking feedback on changes to the treatment of private student loans in bankruptcy.  Responses to the CFPB request are due April 8, 2013.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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