Aiming to rein in student loan industry, Virginia House passes ‘borrowers bill of rights’ – Fredriskburg.com
Legislation aimed at forcing student loan service companies to be more transparent and forthcoming in their dealings with borrowers cleared the House of Delegates with bipartisan support Monday.
The bill creates a “borrower’s bill of rights” and would subject the student loan industry to rules in line with what are currently in place for banks, credit unions and mortgage lenders, says its patron, Del. Marcus Simon, D-Fairfax.
“Right now student loan borrowers are unregulated at the state level despite being the second largest source of debt in the United States,” Simon said.
The rules would explicitly prohibit a wide range of bad behavior on the part of companies that serve as a go-between for students and federal or private financing companies, including:
- making false statements or omitting material facts,
- misapplying payments,
- defrauding or misleading, and
- refusing to correct credit reports.