The CFPB has announced it will be issuing a rule that will allow the Bureau to supervise certain nonbank student loan servicers for the first time. Student loans, which constitute the nation’s second largest consumer debt market, have seen a rise in borrower delinquency in recent years.
The rule will allow the CFPB to supervise any nonbank student loan servicer that handles more than one million borrower accounts, regardless of whether they service federal or private loans, to ensure they are complying with federal consumer financial laws. The Bureau currently oversees student loan servicing at the largest banks.
The Bureau estimates that it will have authority to supervise the seven largest student loan servicers. Combined, the seven institutions service more than 49 million borrower accounts, representing most of the activity in the student loan servicing market.
Read the press release.