Student loan lenders are the next in line for a report card from the Consumer Financial Protection Bureau.
On Monday, the Bureau published the procedures it will use when examining student lenders. The Student Lending Examination Procedures are an extension of the CFPB's General Supervision and Examination Manual and will be used as a field guide by CFPB examiners to ensure that private student lenders comply with federal consumer financial laws.
The CFPB, created by the Dodd-Frank Act, has the authority to supervise large banks, as well as nonbanks, that provide private student loans. Examiners will be looking to verify that lenders are complying with requirements of federal consumer financial law through the following:
- Evaluating evaluate marketing and advertising materials, such as mail and text messages, telephone solicitation scripts, and agreements and disclosures for the products and services to make sure the materials are not deceptive, misleading, or discriminatory.
- Assessing whether the lender or service provider makes proper, clear disclosures about loan costs and terms at the time of the consumer's application, loan approval, and loan disbursement as required under special rules for education lending.
- Determining if the lender or service provider, if required to do so, supplies the borrower with periodic statements that include such information as monthly payment requirements, charges, fees, and interest rate changes.
- Evaluating the systems, procedures, and policies used by the company for tracking, handling, investigating, and resolving consumer inquiries, disputes, and complaints.
The Bureau is also developing a slate of new consumer tools, including: guides for students and families shopping for student loans and managing money while in college; a comparison tool to help students and their families compare financial aid offers from multiple schools; and a new web tool to help student loan borrowers navigate their repayment options.