§ 721. Responsibilities.
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§ 721. Responsibilities. 1. If a student loan servicer regularly
reports information to a consumer reporting agency, the servicer shall
accurately report a borrower's payment performance to at least one
consumer reporting agency that compiles and maintains files on consumers
on a nationwide basis as defined in Section 603(p) of the federal Fair
Credit Reporting Act (15 U.S.C. Sec. 1681a(p)), upon acceptance as a
data furnisher by that consumer reporting agency.
2.
(a)Except as provided in federal law or required by a student loan
agreement, a student loan servicer shall inquire of a borrower how to
apply a borrower's nonconforming payment. A borrower's direction on how
to apply a nonconforming payment shall remain in effect for any future
nonconforming payment during the term of a student loan until the
borrower provides different directions.
(b)For purposes of this subdivision, "nonconforming payment" shall
mean a payment that is either more or less than the borrower's required
student loan payment.
3.
(a)If the sale, assignment, or other transfer of the servicing of
a student loan results in a change in the identity of the person to whom
the borrower is required to send subsequent payments or direct any
communications concerning the student loan, a student loan servicer
shall transfer all information regarding a borrower, a borrower's
account, and a borrower's student loan, including but not limited to the
borrower's repayment status and any borrower benefits associated with
the borrower's student loan, to the new student loan servicer servicing
the borrower's student loan within forty-five days.
(b)A student loan servicer shall adopt policies and procedures to
verify that it has received all information regarding a borrower, a
borrower's account, and a borrower's student loan, including but not
limited to the borrower's repayment status and any borrower benefits
associated with the borrower's student loan, when the servicer obtains
the right to service a student loan.
4. If a student loan servicer sells, assigns, or otherwise transfers
the servicing of a student loan to a new servicer, the sale, assignment
or other transfer shall be completed at least seven days before the
borrower's next payment is due.
5.
(a)A student loan servicer that sells, assigns, or otherwise
transfers the servicing of a student loan shall require as a condition
of such sale, assignment or other transfer that the new student loan
servicer shall honor all borrower benefits originally represented as
being available to a borrower during the repayment of the student loan
and the possibility of such benefits, including any benefits that were
represented as being available but for which the borrower had not yet
qualified.
(b)A student loan servicer that obtains the right to service a
student loan shall honor all borrower benefits originally represented as
being available to a borrower during the repayment of the student loan
and the possibility of such benefits, including any benefits that were
represented as being available but for which the borrower had not yet
qualified.
6. A student loan servicer shall respond within thirty days after
receipt to a written inquiry from a borrower or a borrower's
representative.
7. A student loan servicer shall preserve records of each student loan
and all communications with borrowers for not less than two years
following the final payment on such student loan or the sale, assignment
or other transfer of the servicing of such student loan, whichever
occurs first, or such longer period as may be required by any other
provision of law.