Today’s Reports are Tomorrow’s Regulations
by PJ Hoffman, Regulatory Affairs Counsel
In case you haven’t noticed, it seems that everyone has an opinion about private student lending. In just the past few months we have seen regulators, legislators, and news outlets all getting in on the act. If your credit union is involved with private student lending or anticipates entering into the market sometime soon, then you need to be paying attention. After all, today’s reports are tomorrow’s regulations.
We’ve been ringing the bell here at NAFCU on student lending as reports and requests for information have come up, but it is important to understand the landscape going forward.
The CFPB has had this issue in their sights for a while now. In October 2012, the CFPB’s Student Loan Ombudsman released a report on private student loans that highlighted and summarized information and complaints received by the CFPB concerning the student loan marketplace. Many of the issues centered on frustration about the inability to speak with personnel empowered to negotiate a repayment plan, inability to refinance, and inability to access repayment plans previously advertised. While the CFPB acknowledged that credit unions and other small financial institutions generated very few complaints and that increased participation from those same small institutions might benefit the market, it is incumbent upon us to see that today’s reports are tomorrow’s regulations.
The CFPB has taken it two steps further in focusing on financial products offered to students, which Steve mentioned here on this blog, when they introduced two requests for information on financial products marketed to students through colleges and universities and another on the private student loan market. NAFCU has put out Regulatory Alerts on both available here with comment letters to follow.
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