New York Division of Monetary Companies requests data relating to personal pupil mortgage refinancing

On December 22, 2021, New York State Senate Bill 2767A was signed into legislation. The Invoice establishes the Non-public Scholar Mortgage Refinancing Job Pressure (the “Job Pressure”), which was charged with “research[ing] and analyz[ing] methods lending establishments that provide non-federal pupil loans to college students of New York establishments of upper schooling might be incentivized and inspired to create pupil mortgage refinance applications.”  As a part of that directive, on November 8, 2022, the Job Pressure requested information from “ stakeholders” regarding private-sector refinancing of pupil loans.  Responses are requested by December 8, 2022.  That gained’t give the Job Pressure a lot time to “research and analyze” the responses, as its report back to the Governor and Legislature have to be submitted no later than December 31, 2022.

Contained within the Job Pressure’s data request is a prolonged checklist of questions, which embrace:

  • What choices can be found for pupil mortgage debtors to refinance personal pupil loans each in New York State and out of doors the state?  Who’s providing these loans?  What are the phrases?  Are they restricted to sure kinds of pupil loans?
  • What’s the quantity of personal pupil loans refinanced, the phrases of the debtors’ prior loans, the phrases of the debtors’ refinancing loans, the unmet want for pupil mortgage refinancing, and the impression of those refinancing loans in New York and nationwide?
  • How does the prospect of presidency mortgage forgiveness or cancellation have an effect on pupil mortgage refinancing?
  • How and to whom is pupil mortgage refinancing at the moment marketed in New York State?
  • What disclosures are made to debtors who refinance into personal loans, together with disclosures regarding the results of refinancing and the potential lack of any advantages on debtors who refinance their federal loans?  What disclosures must be required?
  • What can the general public or personal sectors do to make protected and reasonably priced personal pupil mortgage refinancing extra accessible to debtors?
  • Are there any statutory or regulatory actions that might make personal pupil mortgage refinancing safer, extra reasonably priced, and extra accessible?  Are there different applications or public incentives that might make personal pupil mortgage refinancing safer, extra reasonably priced, and extra accessible?  What are the estimated prices, advantages, outcomes, and different results of those applications?

Whereas the ultimate results of the Job Pressure’s assessment is but to be decided, different states have just lately checked out points surrounding the personal refinancing of pupil loans.  In 2021, Maine handed disclosure necessities addressing the refinancing of schooling loans into personal schooling loans.  Particularly, the legislation requires the lender to offer the borrower with a disclosure that the advantages and protections relevant to the present mortgage could also be misplaced as a result of refinancing. See Me. Rev. Stat. tit. 9-A, § 16-103(b).  It will not be shocking to see New York attain an identical conclusion.