HB 2342 Summary

• Establishes licensing requirements for student loan servicers operating in Arizona, requiring applicants to submit $1,000 license fees, $800 investigation fees, financial statements, and criminal history disclosures.

• Creates a student loan ombudsman position within the department to receive and resolve borrower complaints, compile complaint data, and establish a borrower education course by October 1, 2024.

• Exempts banks, credit unions, and their wholly owned subsidiaries from licensing requirements.

• Prohibits student loan servicers from engaging in fraud, deception, misapplication of payments, inaccurate credit reporting, and harassment, while requiring accurate reporting to credit bureaus and compliance with federal law.

• Imposes civil penalties up to $100,000 per violation and private liability including actual damages, triple damages on collected amounts, punitive damages, and attorney fees for willful noncompliance.