Student loans; licensing of qualified education loan servicers, civil penalties, report. (HB10)

Introduced By

Del. Marcus Simon (D-Falls Church) with support from co-patron Sen. Janet Howell (D-Reston)

Progress

Introduced
Passed Committee
Passed House
Passed Senate
Signed by Governor
Became Law

Description

Qualified education loan servicers. Prohibits any person from acting as a qualified education loan servicer except in accordance with provisions established by this bill. The bill requires a loan servicer to obtain a license from the State Corporation Commission (SCC) and establishes procedures pertaining to such licenses. Banks, savings institutions, credit unions, nonprofit institutions of higher education, and farm credit systems are exempt from the licensing provisions. The servicing of a qualified education loan encompasses (i) receiving any scheduled periodic payments from a qualified education loan borrower or notification of such payments; (ii) applying the payments of principal and interest and such other payments, with respect to the amounts received from a qualified education loan borrower, as may be required pursuant to the terms of a qualified education loan; (iii) during a period when no payment is required on a qualified education loan, maintaining account records and communicating with the qualified education loan borrower; and (iv) interacting with a student loan borrower, including conducting activities to help prevent default. Qualified education loan servicers are prohibited from, among other things, (a) misrepresenting the amount, nature, or terms of any fee or payment due or claimed to be due on a qualified education loan, the terms and conditions of the loan agreement, or the borrower's obligations under the loan; (b) knowingly misapplying loan payments to the outstanding balance of a qualified education loan; and (c) failing to report both the favorable and unfavorable payment history of the borrower to a nationally recognized consumer credit bureau at least annually if the loan servicer regularly reports information to such a credit bureau. Violations are subject to a civil penalty not exceeding $2,500 and are prohibited practices under the Virginia Consumer Protection Act. The bill has a delayed effective date of July 1, 2021, but provides that applications shall be accepted, and investigations commenced, by the SCC beginning March 1, 2021. Read the Bill »

Status

02/17/2020: passed committee

History

DateAction
11/18/2019Prefiled and ordered printed; offered 01/08/20 20100770D
11/18/2019Committee
11/18/2019Referred to Committee on Labor and Commerce
01/21/2020House committee, floor amendments and substitutes offered
01/21/2020Reported from Labor and Commerce with substitute (17-Y 3-N) (see vote tally)
01/21/2020Committee substitute printed 20104524D-H1
01/23/2020Read first time
01/24/2020Read second time
01/24/2020Committee substitute agreed to 20104524D-H1
01/24/2020Amendments by Delegate Simon agreed to
01/24/2020Engrossed by House - committee substitute with amendments HB10EH1
01/24/2020Printed as engrossed 20104524D-EH1
01/27/2020Read third time and passed House (84-Y 15-N)
01/27/2020VOTE: Passage (84-Y 15-N) (see vote tally)
01/28/2020Constitutional reading dispensed
01/28/2020Referred to Committee on Commerce and Labor
02/05/2020Impact statement from DPB (HB10EH1)
02/17/2020Rereferred from Commerce and Labor (15-Y 0-N) (see vote tally)
02/17/2020Rereferred to Finance and Appropriations

Comments

Ron Q writes:

This seems like good long overdue legislation. Misleading those about to make a major financial decision should not be allowed.

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