An Act To Establish a Student Loan Bill of Rights To License and Regulate Student Loan Servicers
Maine Legislature, Session 128, LD 1507
Committee Amendment CA_B_S405 (Senate)

COMMITTEE AMENDMENT "(3" to S.P. 532, L.D. 1507, Bill, "An Act To 
Establish a Student Loan Bill of Rights To License and Regulate Student Loan Servicers" 
Amend the bill by striking out the title and substituting the following: 
'An Act To Establish a Student Loan Bill of Rights To Regulate Student Loan 
Servicers' 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'Sec. 1. 9-A MRSA Art. 14 is enacted to read: 
ARTICLE14 
STUDENT LOAN BILL OF RIGHTS 
§14-101. Short title 
This Article may be known and cited as "the Student Loan Bill of Rights.'' 
§14-102. Applicability 
This Article applies to a person who acts as a student loan servicer in this State, 
except that this Article does not apply to a supervised financial organization or a financial 
institution holding company as defined in Title 9-B, section 1011, subsection 1, to a 
mutual holding company as defined in Title 9-B, section 1052, subsection 2 or to a 
wholly owned subsidiary of a supervised financial organization, financial institution 
holding company or mutual holding company. 
§14-103. Definitions 
As used in this Article, unless the context otherwise indicates, the following terms 
have the following meanings. 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" f>" to S.P. 532, L.D. 1507 
1. Servicing. 
11Servicing
means: 
A. Receiving scheduled periodic payments from a student loan borrower pursuant to 
the terms of a student education loan; 
B. Applying the payments of principal and interest and such other payments with 
respect to the amounts received from a student loan borrower as may be required 
pursuant to the terms of a student education loan; and 
C. Performing other administrative services with respect to a student education loan. 
2. Student education loan. 
11Student education loan
means a loan that is extended 
to a student loan borrower expressly for postsecondary education expenses or other 
school-related expenses and does not include open-end credit or any loan that is secured 
by real property. 
3. Student loan borrower. 
11Student loan borrower
means: 
A. A resident of this State who has received or agreed to pay a student education 
loan; or 
B. A person who shares legal responsibility with a resident under paragraph A for 
repaying the student education loan. 
4. Student loan servicer. 
11Student loan servicer'' means a person, wherever located, 
responsible for the servicing of a student education loan to a student loan borrower. 
11Student loan servicer
does not include a supervised financial organization or a financial 
institution holding company as defined in Title 9-B, section 1011, subsection 1, a mutual 
holding company as defined in Title 9-B, section 1052, subsection 2 or a wholly owned 
subsidiary of a supervised financial organization, financial institution holding company or 
mutual holding company. 
5. Superintendent. "Superintendent" means the Superintendent of Consumer Credit 
Protection. 
§14-104. Annual report 
Beginning January 1, 2021, the superintendent shall submit a report by January 1st of 
each year to the joint standing committees of the Legislature having jurisdiction over 
education and cultural affairs and insurance and financial services matters. The report 
must include: 
1. 
Implementation. 
A description of actions taken with respect to the 
implementation of this Article; 
2. Effectiveness. An assessment of the overall effectiveness of the student loan 
servicer registration requirements under section 14-105; and 
3. 
Additional steps. 
Recommendations regarding additional steps for the 
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Department of Professional and Financial Regulation to gain regulatory control over 
registration and enforcement with respect to student loan servicers. 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" fo" to S.P. 532, L.D. 1507 
§14-105. Registration of student loan servicers 
A person may not act as a student loan servicer, directly or indirectly, without first 
registering with the superintendent pursuant to this section, unless that person is exempt 
from registration pursuant to subsection 1. 
1. 
Exempt. 
The following persons are exempt from student loan servicer 
registration requirements: 
A. A licensed bank or credit union, a wholly owned subsidiary of such a bank or 
credit union and an operating subsidiary of such a bank or credit union as long as 
each owner of the operating subsidiary is wholly owned by that bank or credit union; 
B. A supervised financial organization or a financial institution holding company as 
defined in Title 9-B, section 1011, subsection 1, a mutual holding company as 
defined in Title 9-B, section 1052, subsection 2 or a wholly owned subsidiary of a 
supervised financial organization, financial institution holding company or mutual 
holding company; and 
C. The Finance Authority of Maine. 
2. Application. A person seeking to act within this State as a student loan servicer 
shall make a written application to the superintendent for an initial registration in such 
form as the superintendent prescribes. The application must be accompanied by: 
A. The legal name and business address of the applicant and, if the applicant is a 
partnership, limited liability company, association or corporation, the name of every 
partner, limited liability member, officer or administrator of the applicant; 
B. 
Information demonstrating that the applicant maintains a toll-free telephone 
number or other free means of oral communication · that is staffed during normal 
business hours for student loan borrowers to use to communicate with the applicant 
concerning the servicing of a student loan; 
C. Such other information as the superintendent may reasonably require with respect 
to the applicant; and 
D. A nonrefundable registration and renewal fee of $250. 
3. Effective registrations. Registration pursuant to this Article remains effective 
0 
through the remainder of the calendar year of its date of issuance, unless sooner 
surrendered, suspended or revoked. 
4. Annual renewal. Registrations must be renewed annually, in such form as the 
superintendent may prescribe. 
5. Records retention; records request. A student loan servicer shall maintain 
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adequate records of each student education loan transaction for not less than 2 years 
following the final payment on the student education loan or the assignment of the 
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student education loan, whichever occurs first, or such longer period as may be required 
by any other provision of law. Upon request by the superintendent, a student loan 
servicer shall make such records available or shall send such records to the 
superintendent by registered or certified mail, return receipt requested, or by any express 
delivery carrier that provides a dated delivery receipt, not later than 5 business days after 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT«£;," to S.P. 532, L.D. 1507 
being requested by the superintendent to do so. The superintendent may grant a registrant 
additional time to make such records available or to send the records to the 
superintendent. 
6. Registration suspension and revocation; refusal to renew; violations. The 
superintendent may suspend, revoke or refuse to renew a registration issued pursuant to 
this section or take any other action in accordance with Article 6 if the superintendent 
finds one of the following: 
A. The registrant has violated any provision of this Article or any rule or order 
lawfully adopted or made pursuant to and within the authority of this Article: or 
B. Any fact or condition exists that, if it had existed at the time of the original 
application for the registration, clearly would have warranted a denial of the 
registration. 
An abatement of the registration fee may not be made if the registration is surrendered, 
revoked or suspended. 
7. Examination. The superintendent may examine the books, accounts and records 
of an applicant or registrant and make investigations to determine compliance with this 
Article. 
8. Expenses of the superintendent. The expenses of the superintendent necessarily 
incurred in the examination and investigation of persons subject to this Article are 
chargeable to that person in the same manner and for the same expenses set forth in 
section 6-106, subsection 6. 
§14-106. Student loan servicers 
1. Prohibited acts. A student loan servicer may not: 
A. Directly or indirectly employ a scheme, device or artifice to defraud or mislead 
student loan borrowers: 
B. Engage in an unfair or deceptive practice toward any person or misrepresent or 
omit any material information in connection with the servicing of a student education 
loan, including, but not limited to, misrepresenting the amount, nature or terms of any 
fee or payment due or claimed to be due on a student education loan, the terms and 
conditions of the loan agreement or the student loan borrower's obligations under the 
loan; 
C. Obtain property by fraud or misrepresentation; or 
D. Fail to comply with any provision of this Article or rules adopted under this 
Article or fail to comply with any other state or federal law, including the rules and 
regulations applicable to any student loan servicer registered under this Article. 
§14-107. Compliance with federal law 
A student loan servicer shall comply with all applicable federal laws and regulations 
relating to student loan servicing, including, but not limited to, the federal Truth in 
Lending Act, 15 United States Code, Sections 1601 to 1667f (2010), as amended, and the 
regulations adopted pursuant to that Act. In addition to any other remedies provided by 
COMMITTEE AMENDMENT 
CO:tvfMITTEE AMENDMENT"~" to S.P. 532, L.D. 1507 
law, a violation of that Act or regulations adopted pursuant to that Act is a violation of 
this section and a basis upon which the superintendent may take enforcement action 
pursuant to this Article. 
§14-108. Rulemaking 
The superintendent shall adopt rules to implement this Article. 
Rules adopted 
pursuant to this section are routine technical rules as defined in Title 5, chapter 375, 
subchapter 2-A. 
Sec. 2. Appropriations and allocations. The following appropriations and 
allocations are made. 
PROFESSIONAL AND FINANCIAL REGULATION, DEPARTMENT OF 
Bureau of Consumer Credit Protection 0091 
Initiative: Provides funding for additional rulemaking, printing, copying and postage. 
OTHER SPECIAL REVENUE FUNDS 
All Other 
OTHER SPECIAL REVENUE FUNDS TOTAL 
2017-18 
$0 
$0 
Sec. 3. Effective date. This Act takes effect January 1, 2019.' 
SUMMARY 
2018-19 
$2,500 
$2,500 
This amendment is the majority report of the committee and replaces the bill and 
changes the title. The amendment does the following. 
1. It establishes a registration procedure for student loan servicers. It provides an 
exemption from the registration provisions for supervised financial organizations and 
financial institution holding companies and clarifies that a student loan servicer does not 
include supervised financial organizations or financial institution holding companies. It 
also provides an exemption for the Finance Authority of Maine. 
2. Beginning January 1, 2021, it requires the Superintendent of Consumer Credit 
Protection within the Department of Professional and Financial Regulation to submit an 
annual report by January 1st in regard to the effectiveness of student loan servicer 
registration and to recommend additional steps necessary to gain regulatory control over 
registration and enforcement with respect to student loan servicers. 
3. It identifies prohibited acts for student loan servicers, including employing any 
scheme, device or artifice to defraud or mislead student loan borrowers. 
4. It requires student loan servicers to comply with all applicable federal laws and 
regulations related to student loan servicing. 
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5. It requires the superintendent to adopt routine technical rules necessary to carry 
out the provisions of this legislation. 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" fb" to S.P. 532, L.D. 1507 
6. It adds an appropriations and allocations section. 
7. It adds an effective date of January 1, 2019. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: 03/07/18 ~a~ 
LD 1507 
LR 1018(04) 
An Act To Establish a Student Loan Bill of Rights To License and Regulate Student Loan Servicers 
Fiscal Note for Bill as Amended by Committee Amendment 'j;" ( £-l..j06) 
Committee: Insurance and Financial Services 
Appropriations/ Allocations 
Other Special Revenue Funds 
Revenue 
Other Special Revenue Funds 
Fiscal Detail and Notes 
Fiscal Note Required: Yes 
Fiscal Note 
FY2017-18 
FY2018-19 
$0 
$2,500 
$0 
$2,500 
Projections 
FY2019-20 
$2,500 
$2,500 
Projections 
FY2020-21 
$2,500 
$2,500 
The bill includes Other Special Revenue Funds allocations to the Department of Professional and Financial 
Regulation of $2,500 beginning in fiscal year 2017-18 for additional printing, copying and postage. The increased 
revenue will come from new license and investigation fees. Anticipated revenue is based on an estimated licensing 
pool of 12. 
LR1018(04)- Fiscal Note - Page 1 of 1