On May 24, President Trump signed a bill that repeals parts of the Dodd-Frank Act. Many community banks and smaller financial institutions have been ensnared in the burdensome regulatory bureaucracy and too-big-to-fail policies meant for our country’s largest financial institutions. Easing the burden on smaller financial institutions will allow them to compete for business and help grow the economy, particularly in rural areas where access to credit has been more limited.
The legislation includes two provisions related to the repayment of private student loans. The first provision prohibits a lender from declaring default or accelerating repayment terms when a co-signer of the loan declares bankruptcy or dies. Also, if a student borrower were to die, the lender will be required to release the co-signer from any remaining debt. Here is more information, straight from the bill summary:
The second provision will make it easier for you to remove a private student loan default from your credit report. If a lender offers a rehabilitation program that involves a borrower resuming consistent payments on the loan, the borrower could ask the bank to remove the mark from their credit. The request could only be done once per loan. These new rules will apply to private loan agreements entered into 180 days or more after the bill's passage. Here is more information, straight from the bill summary:
GradFin will be closely following the implementation of this bill and all other legislative activity related to student loan debt. For more information on the bill, click here.
Moby Debt Blog
GradFin will be periodically updating you on our company.