Legal Seminar, Denver, CO

Fintech Charter

True Lender Doctrine

Madden v. Midland

Student Loan Servicing

For Discussion Purposes Only

Student Loan Servicing: Background • Beginning in 2015, several states began passing laws requiring student loan servicers to obtain licenses to service education loans to borrowers residing in their states.

• In 2016, the Department of Education (ED) released a memo indicating that federal law does not preempt state regulation and licensing of student loan servicers.

• In 2017, ED rescinded this memo and received requests by trade associations to issue an interpretation declaring state servicing laws preempted.

• In March 2018, ED issued an Interpretive Notice asserting its view that state licensing and regulation of “federal student loan servicers” is preempted. – A “federal student loan servicer” is an entity servicing student loans under the William D. Ford Direct Loan Program and the Federal Family Education Loan (FFEL) Program.

For Discussion Purposes Only