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S T A T E O F N E W Y O R K
________________________________________________________________________
431
2025-2026 Regular Sessions
I N A S S E M B L Y
(PREFILED)
January 8, 2025
___________
Introduced by M. of A. EPSTEIN -- read once and referred to the Commit-
tee on Banks
AN ACT to amend the financial services law, in relation to private
education debt reporting
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The article heading of article 9 and sections 901, 902 and
904 of the financial services law, as added by a chapter of the laws of
2024 amending the financial services law relating to creating a private
education debt registry, as proposed in legislative bills numbers S.
8197 and A. 8913, are amended to read as follows:
ARTICLE 9
PRIVATE EDUCATION DEBT [REGISTRY] REPORTING
§ 901. Definitions. As used in this article:
1.[ "Fiscal year" means the twelve-month period that the private
education creditor uses for financial reporting and budgeting.
2.] "Higher education" means higher education[, including] OR career
education, as those terms are defined in section two of the education
law, via correspondence, online, or in person, regardless of whether the
PROVIDER OF SUCH higher education [institution] is [accredited] LOCATED
within New York state.
[3.] 2. "Higher education expense" means any expense THAT IS INCURRED
BY A CONSUMER arising from higher education.
3. "STUDENT LOAN SERVICER" HAS THE SAME MEANING AS SUCH TERM IS
DEFINED IN SUBDIVISION SIX OF SECTION SEVEN HUNDRED TEN OF THE BANKING
LAW.
4. "Private education creditor" means any person engaged in the busi-
ness of [securing, making, or] extending a private education debt[, or
any holder of a private education debt, including providers of higher
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD02724-01-5
A. 431 2
education to which a student education debt is owed. "Private education
creditor" shall not include the following persons, only to the extent
that state regulation is preempted by federal law:
(a) any federally chartered bank, savings bank, savings and loan asso-
ciation, or credit union;
(b) any bank, savings bank, savings and loan association, or credit
union organized under the laws of this or any other state;
(c) any wholly owned subsidiary of a federally chartered bank or cred-
it union; and
(d) any operating subsidiary where each owner of the operating subsid-
iary is wholly owned by the same federally chartered bank or credit
union].
5. "Private education debt" means an extension of credit TO or debt or
obligation owed or incurred by a consumer, contractual or otherwise,
[contingent or absolute,] that [meets all of the following criteria]:
(a) is not made, insured, or guaranteed under Title IV of the Higher
Education Act of 1965 (20 U.S.C. s.1070 et seq.);
(b) is extended to a consumer expressly, in whole or in part, for, or
accrues from nonpayment of, higher education expenses, regardless of
whether the credit or debt or obligation is owed to [the] A provider of
higher education [that the student attends]; and
(c) [shall] IS not [include any] A loan that is secured by real prop-
erty or a dwelling.
"Private education debt" shall include extensions of credit or debt or
obligations owed or incurred to refinance a private education debt.
6. "Provider of higher education" [or "school"] means a person engaged
in [the business of] PROVIDING OR OFFERING TO PROVIDE higher education.
[For the purposes of this definition, a person need not have obtained
authorization from the department of education to operate in this state
and need not be an accredited institution.]
§ 902. Private education debt [registry] REPORTING. 1. [Beginning on
or after the one hundred eightieth day after the effective date of this
article, no person shall engage in business as a private education cred-
itor in this state without first satisfying the following requirements
set forth in subdivisions two and three of this section.
2. (a) A private education creditor operating in this state shall
register with the superintendent pursuant to any registration procedures
set forth by the superintendent by rule or regulation, which may include
registration through the Nationwide Multistate Licensing System and
Registry, and shall pay a fee set by the superintendent. The superinten-
dent may prescribe an alternative registration process and fee structure
for a provider of higher education. Registration shall include, at a
minimum, the name and address of the private education creditor and any
officer, director, partner, or owner of a controlling interest of the
private education creditor. A private education creditor shall annually
renew its registration and pay a renewal fee pursuant to a procedure and
on or before a date to be determined by the superintendent.
(b) This subdivision shall not apply to regulated persons, as such
term is defined in section one hundred four of this chapter, engaged in
business as a private education creditor in this state, to the extent
such regulation relates to its business as a private education creditor
and such persons are required to furnish data or reports annually to the
superintendent.
3. A private education creditor operating in this state shall annual-
ly, on or before a date to be determined by the superintendent and not
to exceed six months following the effective date of this article,
A. 431 3
provide the superintendent with the following documents and information
about such creditor's private education debt portfolio related to
consumers that reside in this state pursuant to any procedure set forth
by the superintendent, which may include reporting through the Nation-
wide Multistate Licensing System and Registry, and which may further
include different procedures for regulated persons, as that term is
defined in section one hundred four of this chapter, and non-regulated
persons] EACH STUDENT LOAN SERVICER SHALL, BY THE FIRST OF APRIL OF EACH
YEAR, SUBMIT AN ANNUAL REPORT WHICH COMPLIES WITH ANY INSTRUCTIONS
PUBLISHED BY THE SUPERINTENDENT, IN THE MANNER SET FORTH IN SUCH
INSTRUCTIONS, CERTIFYING AS ACCURATE THE FOLLOWING INFORMATION FOR THE
PRIVATE EDUCATION DEBT SUCH STUDENT LOAN SERVICER SERVICED DURING THE
PRIOR CALENDAR YEAR:
(a) [For private education creditors that secure, make, or extend
private education debts, other than those private education debts
reported pursuant to paragraph (c) of this subdivision, relating to such
debts owed by a consumer residing in this state as of the end of the
prior fiscal year] A LIST OF ALL PRIVATE EDUCATION CREDITORS ASSOCIATED
WITH THE PRIVATE EDUCATION DEBTS SERVICED BY THE STUDENT LOAN SERVICER
THAT ARE OWED BY PERSONS WHO RESIDED IN NEW YORK DURING THE PRIOR CALEN-
DAR YEAR; AND
(B) FOR EACH PRIVATE EDUCATION CREDITOR REPORTED PURSUANT TO PARAGRAPH
(A) OF THIS SUBDIVISION, THE FOLLOWING INFORMATION:
(i) a list of [all schools for which such private education debts were
used to finance] THE PROVIDERS OF higher education[, including, in the
case of a refinancing loan, the school that the consumer attended using
the private education debt that was refinanced] ASSOCIATED WITH THE
PRIVATE EDUCATION DEBTS SERVICED BY THE STUDENT LOAN SERVICER;
(ii) the total outstanding dollar amount and number of [such] private
education debts and the number of consumers who owe such private educa-
tion debts;
(iii) the total dollar amount and number of [such] private education
debts [associated with each school identified under subparagraph (i) of
this paragraph] CREATED IN THE PRIOR CALENDAR YEAR;
(iv) THE NUMBER OF PRIVATE EDUCATION DEBTS THAT EXPERIENCED A DEFAULT
AND THE PERCENTAGE OF SUCH PRIVATE EDUCATION DEBTS ASSOCIATED WITH EACH
PRIVATE EDUCATION CREDITOR;
(V) the total dollar amount and number of private education debts
[secured, made, or extended] THAT DEFAULTED FOR REASONS OTHER THAN NON-
PAYMENT in the prior [fiscal] CALENDAR year;
[(v)] (VI) the total dollar amount and number of private education
debts [secured, made, or extended in the prior fiscal year associated]
with [each school identified under subparagraph (i) of this paragraph] A
COSIGNER OR GUARANTOR;
[(vi)] (VII) the [range of starting interest rates for] TOTAL DOLLAR
AMOUNT AND NUMBER OF private education debts [secured, made, or extended
to consumers] WITH A COSIGNER OR GUARANTOR CREATED in the prior [fiscal]
CALENDAR year [and percentage of consumers who receive those rates;
(vii) the overall default rate, as well as the overall default for
such debts associated with each school listed under subparagraph (i)
of this paragraph];
(viii) the total dollar amount and number of private education debts
[that defaulted for reasons other than non-payment in the prior
fiscal year, as applicable;
(ix) the total dollar amount and number of private education debts
with a cosigner, as applicable;
A. 431 4
(x) the total dollar amount and number of private education debts
secured, made, or extended with a cosigner in the prior fiscal year, as
applicable;
(xi) the total dollar amount and number of private education debts
secured, made, or extended] CREATED to refinance other private education
debts or federal student loans, respectively[, as applicable];
[(xii)] (IX) the total dollar amount and number of private education
debts [secured, made, or extended] CREATED to refinance other private
education debts or federal student loans, respectively, in the prior
[fiscal] CALENDAR year[, as applicable];
[(xiii)] (X) the total dollar amount and number of DEFAULTED private
education debts for which the [private education creditor has sued to
collect] STUDENT LOAN SERVICER COMMENCED, MAINTAINED, OR SETTLED A
LAWSUIT FOR COLLECTION in the prior [fiscal] CALENDAR year[, as applica-
ble]; AND
[(xiv) additional] (XI) information as may in the judgment of the
superintendent be necessary and appropriate in order to assess the total
size and status of the private education debt market and to assess
borrower well-being[; and
(xv) A copy of any model promissory note, agreement, contract or other
instrument used by a private education creditor during the previous
fiscal year to substantiate that a new private education debt has been
extended to the consumer or that a consumer owes a debt or obligation to
the private education creditor.
(b) For private education creditors that acquire or assume private
education debts owed by a consumer residing in this state, relating to
such debts as of the end of the prior fiscal year:
(i) a list of all schools for which such private education debts were
used to finance higher education, including, in the case of a refinanc-
ing loan, the school that the consumer attended using the private educa-
tion debt that was refinanced;
(ii) the total outstanding dollar amount and number of such private
education debts and number of consumers who owe such private education
debts;
(iii) the total dollar amount and number of private education debts
associated with each school identified under subparagraph (i) of this
paragraph;
(iv) the total dollar amount and number of private education debts
acquired or assumed in the prior fiscal year;
(v) the total dollar amount and number of private education debts
acquired or assumed in the prior fiscal year associated with each school
identified under subparagraph (i) of this paragraph;
(vi) the overall default rate, as well as the overall default for such
debts associated with each school listed under subparagraph (i) of this
paragraph;
(vii) the total dollar amount and number of private education debts
that defaulted for reasons other than nonpayment in the prior fiscal
year, as applicable;
(viii) the total dollar amount and number of private education debts
with a cosigner, as applicable;
(ix) the total dollar amount and number of private education debts
that were used to refinance other private education debts, as applica-
ble;
(x) the total dollar amount and number of private education debts for
which the private education creditor has sued to collect in the prior
fiscal year, as applicable; and
A. 431 5
(xi) additional information as may in the judgment of the superinten-
dent be necessary and appropriate in order to assess the total size and
status of the private education debt market and to assess borrower well-
being.
(c) For private education creditors that are providers of higher
education and whose private education debts result from unpaid debts or
obligations that were not extensions of credit and that result from
higher education provided in this state, relating to such debts as of
the end of the prior fiscal year, reported by race and gender:
(i) the total outstanding dollar amount and number of private educa-
tion debts and number of consumers who owe those debts;
(ii) the total dollar amount and number of private education debts
accrued and number of consumers who owe those debts in the prior fiscal
year;
(iii) the total number and balance of student accounts with an academ-
ic or administrative hold resulting from a private education debt;
(iv) the total number and balance of student accounts with an academic
or administrative hold resulting from a private education debt for which
a payment was made in the prior fiscal year and average payment made;
(v) the total number of student accounts for which federal financial
aid was returned to the federal government upon the student's withdrawal
from the provider of higher education in the prior fiscal year, and the
total dollar amount of any private education debt accrued as a result;
(vi) the number of consumers who owe a private education debt who
received a federal pell grant and the average debt owed;
(vii) the number of consumers who owe a private education debt who are
considered in-state and out-of-state students, and the total debt owed
by each group;
(viii) the total dollar amount, number of private education debts, and
number of consumers for which the private education creditor has in the
prior fiscal year (A) charged off the debt, (B) sent the debt to a third
party collection agency, (C) initiated a collection lawsuit, (D)
reported the debt to a consumer credit reporting agency, and (E) sold
the debt;
(ix) the total dollar amount, number of private education debts, and
number of consumers for which the private education creditor has, in the
prior fiscal year, collected on a private education debt in the follow-
ing instances: (A) payment arrangements wherein the payment was not
considered past due, such as tuition installment agreements; (B)
payments made on past due debts during the same academic term or billing
cycle in which the debt accrued and before such debts were sent to a
collection agency; (C) payments made on past due debts before they were
sent to a collection agency, excluding those payments made during the
same academic term or billing cycle in which the debt accrued; (D) a
third party collection agency, prior to initiating a lawsuit; and (E) a
collection lawsuit, including payments made by settlement or pursuant to
a judgment;
(x) additional information as may in the judgment of the superinten-
dent be necessary and appropriate in order to assess the total size and
status of the private education debt market and to assess borrower well-
being; and
(xi) a copy of any model written instrument used by a provider of
higher education in the prior fiscal year to substantiate a private
education debt, including but not limited to a promissory note, enroll-
ment agreement, or contract.]
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4. Not later than [one year] TWO YEARS following the effective date of
this section, the superintendent shall create a publicly accessible
website that includes at least the following information [about private
education creditors registered in this state]:
(a) The name, address, telephone number and website for all[ private
education creditors] STUDENT LOAN SERVICERS; AND
(b) A summary of the information required by subdivision [three] ONE
of this section[; and
(c) Copies of all documents provided under subparagraph (xv) of para-
graph (a) of subdivision three of this section and subparagraph (xi) of
paragraph (c) of subdivision three of this section].
§ 904. Violations. 1. If the superintendent finds, after notice and
hearing, that a [private education creditor] STUDENT LOAN SERVICER has
knowingly violated this article by failing to comply with any [registra-
tion or] reporting requirement or by KNOWINGLY furnishing MATERIALLY
inaccurate information to the superintendent, the superintendent may
impose a civil penalty of not more than ten thousand dollars for each
violation.
2. The superintendent may order that any person who has been found to
have knowingly violated any provision of this article, or of the rules
and regulations issued pursuant thereto, and has thereby caused finan-
cial harm to consumers, be barred for a term not exceeding ten years
from acting as a [private education creditor] STUDENT LOAN SERVICER, or
a stockholder, or an officer, director, partner or other owner, or an
employee of a [private education creditor] STUDENT LOAN SERVICER.
§ 2. This act shall take effect on the same date and in the same
manner as a chapter of the laws of 2024 amending the financial services
law relating to creating a private education debt registry, as proposed
in legislative bills numbers S. 8197 and A. 8913, takes effect.Every fact on this page links to its source, starting with the official bill record.