Governor Cuomo has proposed sweeping protections for those struggling to repay student debt. His proposal, currently being considered by the New York Legislature, would put a halt to predatory practices that too many loan servicers and debt consultants regularly engage in – things like misapplying payments, providing credit reporting agencies with inaccurate information, or any other practice that harms the borrower. The protections would also include banning upfront fees, providing penalties for lenders who fail to comply with the law, and requiring fair contracts with clear and conspicuous disclosures so that borrowers can be fully and well informed.
Additionally, the proposal would require that companies that service student loans must be licensed by the Department of Financial Services. A strong licensing system would ensure that loan servicers would have to meet industry standards just like any other lender. Millions of New Yorkers would benefit from these protections – it’s time to stand up for students.
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