HB 2340 Summary

• Requires student loan servicers to obtain a license from the deputy director, with exemptions for banks, credit unions, and their wholly owned subsidiaries.

• Establishes a Student Loan Ombudsman position to receive and resolve complaints from borrowers, compile complaint data, and provide educational information about student loans.

• Prohibits student loan servicers from engaging in deceptive practices, misapplying payments, providing inaccurate credit bureau information, or communicating in a harassing manner.

• Requires servicers to accurately report payment performance to credit bureaus, honor borrower benefits during loan transfers, respond to borrower inquiries within 30 days, and maintain records for at least two years after final payment.

• Establishes civil penalties up to $100,000 per violation and allows borrowers to sue for actual damages, treble damages, punitive damages, and attorney fees for willful noncompliance.