Bill > S426

This bill establishes a comprehensive Student Borrowers' Bill of Rights in North Carolina that creates a regulatory framework for student loan servicers. The bill requires student loan servicers to obtain a license from the Commissioner of Banks, maintain a minimum net worth of $250,000, and post a surety bond ranging from $150,000 to $500,000 depending on their servicing volume. Student loan servicers must respond to borrower inquiries within specific timeframes, apply payments in ways that minimize late fees, honor loan benefits during transfers, and evaluate borrowers for income-based repayment or loan forgiveness programs before defaulting their loans. The bill also prohibits student loan servicers from engaging in deceptive practices, misapplying payments, or harassing borrowers. Additionally, the legislation creates a Student Loan Ombudsman position within the Commissioner of Banks' office to receive and investigate borrower complaints, compile data on student loan issues, and develop an educational course about student loan rights and responsibilities. The bill provides the Commissioner with extensive investigative and enforcement powers, including the ability to assess civil penalties up to $25,000 per violation, order restitution, and potentially revoke a servicer's license for misconduct. Borrowers are also granted the right to bring civil actions against student loan servicers for injuries caused by violations of the law.

https://www.ncleg.gov/BillLookUp/2025/S426