Sec. 5-50. Cosigner release.

379 words·~2 min read·/il/chapter-110/act-992/5-50

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)For private student loans, a servicer shall provide information on its website concerning the availability and criteria for a cosigner release.

(b)For any private education loan that obligates a cosigner, a servicer shall provide the borrower and the cosigner an annual written notice containing information about cosigner release, including the administrative and objective criteria the servicer requires to approve the release of the cosigner from the loan obligation and the process for applying for cosigner release. If the borrower has met the applicable payment requirement to be eligible for cosigner release, the servicer shall send the borrower and the cosigner a written notification by mail, and by electronic mail if the borrower or cosigner has elected to receive electronic communications from the servicer, informing the borrower and cosigner that the payment requirement to be eligible for cosigner release has been met. The notification must also include information about any additional criteria to qualify for cosigner release and the procedure to apply for cosigner release.

(c)A servicer shall provide written notice to a borrower who applies for cosigner release but whose application is incomplete. The written notice must include a description of the information needed to consider the application complete and the date by which the applicant must furnish the missing information in order to complete the application.

(d)Within 30 days after a borrower submits a completed application for cosigner release, the servicer shall send the borrower and cosigner a written notice that informs the borrower and cosigner whether the servicer has approved or denied the cosigner release application. If the servicer denies a request for cosigner release, the borrower may request copies of any documents or information used in the determination, including the credit score threshold used by the servicer, the borrower's credit report, the borrower's credit score, and any other documents or information specific to the borrower. The servicer shall also provide any adverse action notices required under applicable federal law if the denial is based in whole or in part on any information contained in a credit report.

(e)In response to a written or oral request by the borrower for cosigner release, a servicer shall provide to the borrower the information described in subsection

(b)of this Section.