NC H707

Enacts the Student Borrowers' Bill of Rights requiring the Commissioner of Banks to license and regulate student loan servicers to ensure fair treatment of borrowers, effective June 1, 2022.

Establishes licensing requirements through the Nationwide Multistate Licensing System (NMLS) with a $1,500 application fee, minimum net worth of $250,000, and surety bonds ranging from $150,000 to $500,000 based on servicing volume.

Prohibits servicers from engaging in deceptive practices, misapplying payments, providing inaccurate credit reporting, refusing to communicate with authorized representatives, or failing to properly evaluate borrowers for income-based repayment programs.

Requires servicers to respond to borrower written inquiries within 10 days, honor loan benefits when servicing transfers occur, apply partial payments to minimize late fees, and handle overpayments according to borrower direction.

Creates the Student Loan Ombudsman position, effective January 1, 2023, to receive and respond to borrower complaints, analyze complaint data, monitor loan policies, and establish a borrower education course on loan terms and repayment options by July 1, 2023.