HB 2132 Summary

• Establishes a licensing requirement for student loan servicers operating in Arizona, administered by the deputy director, with exemptions for banks, credit unions, and their wholly owned subsidiaries.

• Requires student loan servicer applicants to pay a $1,000 license fee and $800 investigation fee, submit financial statements, and undergo criminal background checks.

• Creates a student loan ombudsman position to receive and resolve borrower complaints, compile complaint data, and establish a borrower education course covering loan terms, repayment options, and forgiveness programs by October 1, 2023.

• Prohibits student loan servicers from engaging in deceptive practices, misapplying payments, providing inaccurate credit bureau information, or harassing borrowers, and requires accurate reporting of payment history and timely responses to borrower inquiries.

• Imposes civil penalties up to $100,000 per violation and allows borrowers to sue for actual damages, triple the amount collected, punitive damages, and attorney fees for willful noncompliance.