On September 29, the Consumer Financial Protection Bureau (CFPB or Bureau) released a special edition of its Supervisory Highlights, focusing on student loan servicing. The report contained findings on federal student loan servicing that echo many recent public comments by the Bureau, but more notably, this edition of Supervisory Highlights also focused heavily on loans made by schools themselves, and the CFPB simultaneously announced that it was updating its examination manual and would be conducting examinations of schools that make their own loans to students.
The Supervisory Highlights follows the CFPB’s announcement earlier this year that it would examine the operations of post-secondary schools that extend private loans directly to students. CFPB Director Rohit Chopra explained the decision to undertake the review at the time by stating, “Schools that offer students loans to attend their classes have a lot of power over their students’ education and financial future. It’s time to open up the books on institutional student lending to ensure all students with private student loans are not harmed by illegal practices.”
Among other findings from the report, the CFPB found:
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