Stakeholders, including members of ACA International, who will be affected by the Colorado Student Loan Law, SB 21-057, signed by Gov. Jared Polis on June 29, requested more information on the rules and their costs during a public hearing at the Colorado attorney general’s office on Wednesday.
SB 21-057 expands the existing Colorado Student Loan Services Act, which applies only to student loan servicers, by adding a new section covering private lenders, lenders and collection agencies in connection with those education loans that are not issued, are not insured or not insured. guaranteed by federal law and used for post-secondary education, ACA previously reported…
ACA members testified on the bill during a hearing this spring following a campaign to solicit feedback from members with lender clients working in the private student loan industry in Colorado.
The law empowers the administrator of the Unified Consumer Credit Code in the Legal Department to set fees for registering creditors for private education, set requirements for the submission of required documents and information for the register, and prescribe an alternative registration process and fee structure. for public and private non-profit higher education institutions.
Registration is required by September 1, 2021. The administrator is considering emergency rulemaking to implement the registration set of public hearings as part of the process for determining the number of organizations that will need to register.
In response to questions from ACA member Makila Moody, an attorney for Greenberg Sada and Moody PC in Englewood, Colorado, Colorado Student Loan Ombudsman Kelsey Lesko said the attorney general was not currently aware of registration or license fees and the availability of applications.
“It can affect how many people can apply,” Moody said. She added that the fee structure should be established based on loan amounts offered by private lenders versus public educational institutions.
However, Lesko reiterated that the Attorney General is asking for information on the number of legal entities that will apply under the amended law to determine the remuneration structure.
Representatives of private lenders also spoke out during the hearing.
Kay Randleman of the Colorado Institute of Massage Therapy in Colorado Springs said the application and registration fees will affect whether they can continue to provide the financial aid that many rely on for their students.
“Because of this, you’re going to stop schools from offering these programs,” Randleman said.
Heidi Markey, director of financial aid at Adams State University in Alamos, Colorado, said she agrees with Randleman and the fees will affect their lending.
“This will negatively affect our student body. We do have a few situations where students cannot borrow under the Federal Direct Lending program, ”Markey said. “This is a group that we consider to be at risk … we will lose students because of this.”
Lesko said the Attorney General’s office will review feedback from the meeting and provide stakeholders and licensees with an update on the next steps. They did not receive any written feedback, which should have been received on July 14th.
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