On March 28, 2024, four former Walden University students (“Plaintiffs”) filed a proposed settlement both individually and on behalf of a putative class of current and former Walden University (“Walden”) students with the Federal District Court for the District of Maryland to resolve allegations first raised against Walden in a complaint more than two years ago.… Continue Reading
student loan
This week’s podcast episode: Recent developments affecting student loan origination and servicing
With federal student loans approaching $1.7 trillion, private student loans approaching $129 billion, strident consumer group advocacy, and national elections on the horizon, student loan origination and servicing continues to be a focal point for federal and state regulators. In this episode, which repurposes a webinar, we first discuss recent developments at the Department of Education involving loan forgiveness, the framework for servicer accountability, preemption guidance, and new repayment plan. … Continue Reading
CFPB Continues to Expand Its Scrutiny of Higher Education with New Report on College and Postsecondary School Tuition Plans
The CFPB recently released a report regarding higher education tuition payment plans that discusses prevailing practices and highlights certain CFPB concerns regarding consumer impact. The CFPB’s report was based upon (a) a review of hundreds of postsecondary school and college websites that contain publicly available information on tuition plans and related contracts, (b) consumer complaints submitted to the CFPB and Department of Education, and (c) interviews with consumers and meetings with industry participants.… Continue Reading
Kentucky student loan servicer license application available on NMLS
Last year, Kentucky enacted the Student Education Loan Servicing, Licensing, and Protection Act of 2022 (the “Act”), which requires student loan services to be licensed in Kentucky. The Act took effect on July 13, 2023 (the “Effective Date”).
On the Effective Date, the Kentucky Department of Financial Institutions (“DFI”) released its new application checklist and made a license application available through the Nationwide Multistate Licensing System & Registry (“NMLS”). … Continue Reading
Nevada enacts licensing requirement for private education loan lenders and servicers
The Nevada Legislature recently passed Assembly Bill 332 (“AB 332”), which amends Nev. Rev. Stat. Title 55 relating to Banks and Related Organizations to add a new chapter regulating Private Education Lenders and Student Loan Servicers. The provisions of SB 322 will become effective on January 1, 2024.
AB 332 exempts the following entities from its requirements:
- Banks;
- Savings and loan associations;
- Savings banks;
- Thrift companies;
- Credit unions;
- The Nevada System of Higher Education;
- The Western Interstate Commission for Higher Education; and
- Any wholly owned subsidiaries of the above.
This week’s podcast episode: A close look at the U.S. Supreme Court’s decision invalidating the Biden Administration’s student loan forgiveness plan and its potential legal repercussions and impact on student loan borrowers
Last Friday, the U.S. Supreme Court ruled that the Biden Administration did not have the legal authority to proceed with its plan to forgive approximately $400 billion in federal student loans. After reviewing the background of the two cases, we first look at the majority opinion authored by Chief Justice Roberts and discuss the majority’s legal analysis for concluding that the Missouri Attorney General had standing to challenge the plan, that the HEROES Act’s text did not authorize the Secretary of Education to forgive the loans, and that the “major questions” doctrine should be applied to assess whether Congress had given loan forgiveness authority to the Secretary. … Continue Reading
SCOTUS holds Biden lacks authority for $430 billion loan cancellation plan
On June 30, 2023, the U.S. Supreme Court announced long-awaited opinions in two cases challenging the Biden Administration’s authority to proceed with its plan to forgive approximately $430 billion in federal student loans. Most significantly, in Biden v. Nebraska, the Court held that the state of Missouri had standing to challenge the federal action, and that the Biden Administration’s loan cancellation plan was not authorized under the Higher Education Relief Opportunities for Students Act of 2003 (HEROES Act).… Continue Reading
This week’s podcast episode: SCOTUS hears oral argument in cases challenging Biden Administration student loan forgiveness plan: observations and predictions
On February 28, 2023, the U.S. Supreme Court heard nearly four hours of oral argument in two separate cases challenging the Biden Administration’s authority to proceed with its plan to forgive approximately $400 billion in federal student loans. After reviewing the background of the two cases, we look at the three key issues: the plaintiffs’ theories for why they have standing to challenge the plan, the Administration’s reliance on the HEROES Act as authority for the plan, and the applicability of the “major questions” doctrine to the Court’s analysis. … Continue Reading
CFPB issues bulletin on handling of discharged student loans by servicers
The CFPB has issued a new bulletin (2023-01) titled “Unfair Billing and Collection Practices After Bankruptcy Discharges of Certain Student Loan Debts.” The bulletin warns servicers that they risk engaging in a UDAAP violation by resuming collection of student loans that were discharged through the regular course of a borrower’s bankruptcy.… Continue Reading
California DFPI releases modified proposed Student Loan Servicing Act regulations
On September 9, 2022, the California Department of Financial Protection and Innovation (DFPI) proposed to amend its student loan servicing regulations, which we previously covered here. After reviewing public comments, on January 6, 2023, the DFPI released a Notice requesting an additional round of public comments on a modified set of regulations. … Continue Reading