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Compliance Blog tackles private education loans
NAFCU's newest member of the compliance team, Loran Jackson, introduces herself and analyzes the scope of Regulation Z's student loan rule in a Compliance Blog post published Friday.
Jackson, NAFCU's regulatory compliance counsel, explains that any credit provider that makes a private education loan (PEL) – which is defined as a loan extended to a consumer in whole or in part for postsecondary education expenses – is a private education lender.
"A private education lender may be a credit union, bank, and even the educational institution the borrower attends," wrote Jackson. "Reg. Z does not put limitation on who is regulated by this section, but focuses on what is regulated: private education loans."
Jackson points to the CFPB's Education Loan Servicing Exam Manual and explains that, under Sections 1026.46-48 of Regulation Z, private education loan lenders are required to disclose terms and interest rates, as well as advertise their terms.
Jackson also provides further clarification on how a credit union can identify whether an application is for a PEL and how a loan can fall under the category of optional compliance.
For more on Regulation Z's student loan rule, read Jackson's full blog here. Those interested can sign up to receive new NAFCU Compliance Blog posts in their inbox every Monday, Wednesday and Friday by clicking here.