DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 837 Original 2020 Regular Session Green
Abstract: Requires student loan servicers to apply a borrower's payment in the manner requested
by the borrower, to respond to inquiries and complaints by the borrower, and to follow
certain other guidelines relative to student education loans.
Proposed law defines "nonconforming payment", "servicing", "student education loan", "student loan
borrower", and "student loan servicer".
Proposed law prohibits a student loan servicer from the following:
(1)Employing a scheme to mislead a student loan borrower.
(2)Engaging in unfair, abusive, or deceptive trade practices.
(3)Misrepresenting or omitting any material information in connection with the servicing of a
student education loan.
(4)Obtaining property by misinformation.
(5)Allocating a nonconforming payment in a manner other than as directed by the borrower.
(6)Knowingly or recklessly misapplying, or refusing to correct a misapplication of payment.
(7)Knowingly or recklessly providing inaccurate information to a consumer reporting agency,
or refuse to correct the inaccurate information.
(8)Failing to report the favorable history f a student loan borrower to a nationally recognized
consumer reporting agency at least once a year.
(9)Refusing to communicate with an authorized representative of a student loan borrower.
(10)Negligently making a false statement or omitting a material fact in connection with a report
or investigation.
Proposed law allows a student loan servicer to adopt procedures to verify the authority of a
representative to act on behalf of a student loan borrower. Proposed law requires a student loan servicer to acknowledge receipt of an inquiry or complaint from
a borrower.
Proposed law requires a student loan servicer to provide certain information when responding to an
inquiry or complaint of a borrower.
Proposed law provides time limits applicable to various communications between the student loan
servicer and the borrower.
A violation of proposed law is considered a violation of present law relative to unfair trade practices.
Proposed law allows the commissioner of the office of financial institutions to enforce the provisions
of proposed law by doing any of the following:
(1)Seeking an injunction.
(2)Requiring a violator to take affirmative action to correct the violation.
(3)Investigating violations of proposed law.
(4)Aiding other agencies that have jurisdiction over a violator.
(5)Cooperating in the investigation or prosecution of a violator.
Proposed law authorizes a court to enter any order or judgement necessary to prohibit violations of
proposed law, restore money or property to a harmed person, or appoint a receiver in certain
situations.
Proposed law provides that in any action brought by the commissioner under proposed law the
commissioner is entitled to recover the costs of the action for the use of the state.
(Adds R.S. 6:1381-1384)