ORS Chapter 725a — Short-Term Loans and

ORS 725a.521. Required practices under federal student loan agreement; prohibitions; exemptions. (1) Except as otherwise required under federal law, in a federal student loan agreement or in a contract between the federal government and a person that services a student loan, a person that services a student loan shall: (a) Assess any fee that the person may assess against a borrower within 45 days after the borrower incurs the fee. (b) Accept and credit, or treat as credited, to the borrowers account all amounts the person receives at the address to which the borrower has been instructed to send payments or notifications of payment on the borrowers student loan. The person must credit the payment, or treat the payment as credited, within one business day after receiving the payment or notification of payment if the borrower has provided sufficient information to credit the account. If the person uses the scheduled method of accounting and the person receives a regularly scheduled payment before the scheduled due date, the person shall credit the payment to the borrowers account not later than the scheduled due date. (c) Correct promptly any errors the person makes and refund promptly any fees the person assesses against the borrower in error. (d) Maintain adequate records of each student loan transaction for not less than two years, or a period otherwise specified by law, after a final payment on a student loan or after the person assigns the student loan, whichever occurs first. At the request of the Director of the Department of Consumer and Business Services and within five days after the request or the within the time the director specifies in the request, the person shall make the records available to the director or send the records to the director in the manner the director specifies by rule. (2) A person that services a student loan may not, directly or indirectly: (a) Employ any device, scheme or artifice to defraud another person; (b) Knowingly make an untrue statement of a material fact or omit a material fact that is necessary to make the persons statement true in light of the circumstances in which the person makes the statement, or misrepresent the amount, nature or terms of any fee or payment due or claimed to be due on a student loan or the terms and conditions of a loan agreement or the borrowers obligations under the loan agreement; (c) Obtain property by fraud or misrepresentation; (d) Knowingly misapply or recklessly apply payments to the outstanding balance of a student loan; (e) Engage in an act, practice or course of business that operates or that the person intends to operate as a fraud or deceit upon another person; (f) Make or file with the Department of Consumer and Business Services, or cause to be made or filed with the department, a statement, report or document that the person knows is false in any material respect or manner; or (g) Fail to respond to a consumer complaint, or to communication from the ombudsman appointed or designated under ORS 725A.530, within 30 calendar days or within a reasonable time that the student loan ombudsman specifies in the communication. The person may request in writing that the student loan ombudsman allow not more than 30 additional calendar days within which to respond if in the request the person explains why the additional time is reasonable and necessary. (3) Subsections (1) and (2) of this section do not apply to: (a) A financial institution, as defined in ORS 706.008. (b) A financial holding company or bank holding company, both as defined in ORS 706.008, if the financial holding company or bank holding company does no more than control an affiliate or subsidiary, as defined in 12 U.S.C. 1841(d), and does not engage in business as a student loan servicer. (c) An attorney who is licensed or otherwise authorized to practice law in this state if the attorney services a student loan only incidentally in the course of practicing law. (d) A public body, as defined in ORS 174.109. (e) A public university listed in ORS 352.002. (f) A community college, as defined in ORS 341.005. (g) The Oregon Health and Science University. (h) A nonprofit, private, post-secondary institution that the Higher Education Coordinating Commission has authorized to confer academic degrees under ORS 348.594 to 348.615.