Illinois adopts regulations for student loan servicers

State Issues State Regulators Student Lending Student Loan Servicer Licensing

On October 9, the Illinois Department of Financial and Professional Regulation adopted regulations implementing provisions of the Student Loan Servicing Right Act related to licensing fees, operations, and supervision. Among other things, the provisions (i) establish license, examination, and hearing fees, as well as assessment costs; (ii) require servicers to file notice within 10 business days of any application changes; (iii) require servicers to maintain websites and toll-free telephone services for borrowers and cosigners to access information on existing loans; (iv) require servicers to provide borrowers with information on alternative repayment and loan forgiveness options; (v) outline requirements related to the maintenance of account information, payment processing, cosigner payments, and books and records; (vi) provide record retention requirements; and (vii) address the preparation of independent audit reports and examination ratings. The regulations are effective immediately.