§ 721 — Responsibilities

§ 721. Responsibilities. 1. If a student loan servicer regularly\nreports information to a consumer reporting agency, the servicer shall\naccurately report a borrower's payment performance to at least one\nconsumer reporting agency that compiles and maintains files on consumers\non a nationwide basis as defined in Section 603(p) of the federal Fair\nCredit Reporting Act (15 U.S.C. Sec. 1681a(p)), upon acceptance as a\ndata furnisher by that consumer reporting agency.\n 2. (a) Except as provided in federal law or required by a student loan\nagreement, a student loan servicer shall inquire of a borrower how to\napply a borrower's nonconforming payment. A borrower's direction on how\nto apply a nonconforming payment shall remain in effect for any future\nnonconforming payment during the term of a student loan until the\nborrower provides different directions.\n (b) For purposes of this subdivision, "nonconforming payment" shall\nmean a payment that is either more or less than the borrower's required\nstudent loan payment.\n 3. (a) If the sale, assignment, or other transfer of the servicing of\na student loan results in a change in the identity of the person to whom\nthe borrower is required to send subsequent payments or direct any\ncommunications concerning the student loan, a student loan servicer\nshall transfer all information regarding a borrower, a borrower's\naccount, and a borrower's student loan, including but not limited to the\nborrower's repayment status and any borrower benefits associated with\nthe borrower's student loan, to the new student loan servicer servicing\nthe borrower's student loan within forty-five days.\n (b) A student loan servicer shall adopt policies and procedures to\nverify that it has received all information regarding a borrower, a\nborrower's account, and a borrower's student loan, including but not\nlimited to the borrower's repayment status and any borrower benefits\nassociated with the borrower's student loan, when the servicer obtains\nthe right to service a student loan.\n 4. If a student loan servicer sells, assigns, or otherwise transfers\nthe servicing of a student loan to a new servicer, the sale, assignment\nor other transfer shall be completed at least seven days before the\nborrower's next payment is due.\n 5. (a) A student loan servicer that sells, assigns, or otherwise\ntransfers the servicing of a student loan shall require as a condition\nof such sale, assignment or other transfer that the new student loan\nservicer shall honor all borrower benefits originally represented as\nbeing available to a borrower during the repayment of the student loan\nand the possibility of such benefits, including any benefits that were\nrepresented as being available but for which the borrower had not yet\nqualified.\n (b) A student loan servicer that obtains the right to service a\nstudent loan shall honor all borrower benefits originally represented as\nbeing available to a borrower during the repayment of the student loan\nand the possibility of such benefits, including any benefits that were\nrepresented as being available but for which the borrower had not yet\nqualified.\n 6. A student loan servicer shall respond within thirty days after\nreceipt to a written inquiry from a borrower or a borrower's\nrepresentative.\n 7. A student loan servicer shall preserve records of each student loan\nand all communications with borrowers for not less than two years\nfollowing the final payment on such student loan or the sale, assignment\nor other transfer of the servicing of such student loan, whichever\noccurs first, or such longer period as may be required by any other\nprovision of law.\n