MN SF4735

Requires private student loan servicers to report detailed data to the commissioner beginning January 31, 2025, including borrower information by school, outstanding balances, default rates, interest rates, and loans used for refinancing or collection suits.

Establishes mandatory registration for private student loan lenders with the commissioner beginning January 1, 2025, requiring submission of company name, addresses of owners, officers, and directors; excludes banks and credit unions from regulation.

Prohibits student loan servicers from engaging in deceptive practices including misleading borrowers, misapplying payments, misrepresenting loan forgiveness eligibility, providing incorrect forbearance information, or engaging in abusive acts that interfere with borrower understanding.

Establishes a private right of action allowing borrowers to sue servicers for damages of at least $500 per violation, with minimum $1,500 damages for interference with alternative payment arrangements or loan forgiveness; requires 45-day notice period before filing suit.

Mandates servicers evaluate borrowers for income-driven repayment programs before forbearance or default, complete loan transfers within 45 days, limit customer service hold times to two hours, and honor all borrower benefits during servicer transfers.