Servicers have a unique role to play in the federal student loan program as the government’s loan program has grown over time. This fact sheet helps gives a high level overview of who servicers are, and the success in driving utilization of income-based repayment plans
On November 21,2018, U.S. District Court for the District of Columbia Judge Paul Friedman issued a ruling in Student Loan Servicing Alliance (SLSA) v. Taylor, finding that the District of Columbia may not regulate those student loan servicers under contract with the U.S. Department of Education to service Federal Direct Loans and federally-owned Federal Family Education Loan Program (FFELP) loans.
In his 70-page opinion, Judge Friedman comprehensively addressed the Supremacy Clause issues of express, field, and conflict preemption, as well as intergovernmental immunity.
Primer on the Types of Federal Student Loans
Confused about which type of federal student loan you have? This primer will help you figure it out, including the loan repayment plans that loans in each program are eligible for.
Amended Complaint – civil action filed in the United States District Court for the District of Columbia by the Student Loan Servicing Alliance (SLSA) challenging District of Columbia Law 21-214 and emergency rules to impose additional requirements and fees on federal student loan servicers beyond what is prescribed by federal law.
Federal law establishes the precedent for the federal Department of Education’s (ED) management and oversight of the federal student loan programs, and federal preemption of any conflicting regulations at the state level.
Trade group sues District of Columbia to prevent student loan borrower confusion. Lawsuit challenges local law imposing regulations preempted by federal law.
March 20, 2018, the Student Loan Servicing Alliance (SLSA) filed a civil action in the United States District Court for the District of Columbia challenging District of Columbia Law 21-214 and emergency rules to impose additional requirements and fees on federal student loan servicers beyond what is prescribed by federal law. The lawsuit was filed on the grounds that federal law preempts D.C. Law 21-214 and the emergency rules.
The vast majority of borrowers are managing their student loans successfully. Student loan servicers are on the front lines helping. Check out our Fact Sheet to learn more.
Download
Testimony of Winfield Crigler, Executive Director SLSA
Before the Joint Consumer Protection and Professional Licensure Committee
July 18, 2017
Some very brief background on the student loan programs
SLSA opposes S129 and H2173
Federal Loans are already extensively regulated.
Most federal loan borrowers are successfully repaying their student loans.
The current Department of Education compensation structure encourages servicers to do the right thing.
Private loans have very low delinquency and default rates.
Small servicers will be harmed.
Could the federal student loan program be improved? Yes…
PowerPoint presentation, containing an overview of student loan servicing, including information about SLSA, Federal Student Loans, Private Education Loans and the Consumer Financial Protection Bureau.
With $1.4 trillion in outstanding student loan debt in the United States, Illinois state lawmakers are rightly exploring effective ways to improve the higher education financing system. Unfortunately for Illinois borrowers, the Student Loan Servicing Rights Act (SB 1351), currently on its way to the Governor’s desk, is misguided.
