Delaware General Assembly

House Appropriations 5/5/16

The General Assembly has ended, the current status is the final status.

4/28/16

Bentz

Sen. Townsend

Reps. Briggs King, Heffernan, Longhurst, Mitchell, Osienski, B. Short

AN ACT TO AMEND TITLE 5 OF THE DELAWARE CODE RELATING TO STUDENT LOANS.

The country is experiencing exponential growth in student loan debt as well as defaults on student loans. Student loan debt and managing loan repayment is becoming a more important problem for millions of Americans. In Delaware, an estimated 129,000 residents have student loan debt. Delaware also ranks first among states with the highest average student debt total, with the average student graduating with nearly $34,000 in student loans. This bill takes a modest step towards protecting Delawareans from predatory student loan servicing practices. Specifically, this Act creates a new chapter in the Banking title that would create a Student Loan Ombudsman within the Office of the State Bank Commissioner. The Student Loan Ombudsman would be responsible for receiving, investigating, and attempting to assist with complaints and questions about student loan borrowers (limited by definition to resident of this state). The Ombudsman would also analyze data trends from the complaints and questions receive, analyze federal, state, and local developments and make recommendations about further steps that could be taken to address the student loan crisis. The Ombudsman would also create a student loan education course to ensure potential and current borrowers have complete information regarding key loan terms, documentation requirements, payment obligations, income-based repayment options, loan forgiveness, and disclosure requirements so that borrowers are able to make wise financial decisions. The Commissioner will annually make a report to the Senate Banking and Business committee and the House Economic Development committee regarding the implementation of the ombudsman position and borrower education course, the overall effectiveness of the ombudsman position, and additional steps that may benefit student loan borrowers.

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Takes effect upon being signed into law

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