Public Act 100-0635
 
HB4397 EnrolledLRB100 17085 AXK 32236 b

    AN ACT concerning education.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Student Loan Servicing Rights Act is amended
by changing Section 1-5 as follows:
 
    (110 ILCS 992/1-5)
    (This Section may contain text from a Public Act with a
delayed effective date)
    Sec. 1-5. Definitions. As used in this Act:
    "Applicant" means a person applying for a license pursuant
to this Act.
    "Borrower" or "student loan borrower" means a person who
has received or agreed to pay a student loan for his or her own
educational expenses.
    "Cosigner" means a person who has agreed to share
responsibility for repaying a student loan with a borrower.
    "Department" means the Department of Financial and
Professional Regulation.
    "Division of Banking" means the Division of Banking of the
Department of Financial and Professional Regulation.
    "Federal loan borrower eligible for referral to a repayment
specialist" means a borrower who possesses any of the following
characteristics:
        (1) requests information related to options to reduce
    or suspend his or her monthly payment;
        (2) indicates that he or she is experiencing or
    anticipates experiencing financial hardship, distress, or
    difficulty making his or her payments;
        (3) has missed 2 consecutive monthly payments;
        (4) is at least 75 days delinquent;
        (5) is enrolled in a discretionary forbearance for more
    than 9 of the previous 12 months;
        (6) has rehabilitated or consolidated one or more loans
    out of default within the past 12 months; or
        (7) has not completed a course of study, as reflected
    in the servicer's records, or the borrower identifies
    himself or herself as not having completed a program of
    study.
    "Federal education loan" means any loan made, guaranteed,
or insured under Title IV of the federal Higher Education Act
of 1965.
    "Income-driven payment plan certification" means the
documentation related to a federal student loan borrower's
income or financial status the borrower must submit to renew an
income-driven repayment plan.
    "Income-driven repayment options" includes the
Income-Contingent Repayment Plan, the Income-Based Repayment
Plan, the Income-Sensitive Repayment Plan, the Pay As You Earn
Plan, the Revised Pay As You Earn Plan, and any other federal
student loan repayment plan that is calculated based on a
borrower's income.
    "Licensee" means a person licensed pursuant to this Act.
    "Other repayment plans" means the Standard Repayment Plan,
the Graduated Repayment Plan, the Extended Repayment Plan, or
any other federal student loan repayment plan not based on a
borrower's income.
    "Private loan borrower eligible for referral to a repayment
specialist" means a borrower who possesses any of the following
characteristics:
        (1) requests information related to options to reduce
    or suspend his or her monthly payments; or
        (2) indicates that he or she is experiencing or
    anticipates experiencing financial hardship, distress, or
    difficulty making his or her payments.
    "Requester" means any borrower or cosigner that submits a
request for assistance.
    "Request for assistance" means all inquiries, complaints,
account disputes, and requests for documentation a servicer
receives from borrowers or cosigners.
    "Secretary" means the Secretary of Financial and
Professional Regulation, or his or her designee, including the
Director of the Division of Banking of the Department of
Financial and Professional Regulation.
    "Servicing" means: (1) receiving any scheduled periodic
payments from a student loan borrower or cosigner pursuant to
the terms of a student loan; (2) applying the payments of
principal and interest and such other payments with respect to
the amounts received from a student loan borrower or cosigner,
as may be required pursuant to the terms of a student loan; and
(3) performing other administrative services with respect to a
student loan.
    "Student loan" or "loan" means any federal education loan
or other loan primarily for use to finance a postsecondary
education and costs of attendance at a postsecondary
institution, including, but not limited to, tuition, fees,
books and supplies, room and board, transportation, and
miscellaneous personal expenses. "Student loan" includes a
loan made to refinance a student loan.
    "Student loan" shall not include an extension of credit
under an open-end consumer credit plan, a reverse mortgage
transaction, a residential mortgage transaction, or any other
loan that is secured by real property or a dwelling.
    "Student loan" shall not include an extension of credit
made by a postsecondary educational institution to a borrower
if one of the following apply:
        (1) The term of the extension of credit is no longer
    than the borrower's education program.
        (2) The remaining, unpaid principal balance of the
    extension of credit is less than $1,500 at the time of the
    borrower's graduation or completion of the program.
        (3) The borrower fails to graduate or successfully
    complete his or her education program and has a balance due
    at the time of his or her disenrollment from the
    postsecondary institution.
    "Student loan servicer" or "servicer" means any person
engaged in the business of servicing student loans.
    "Student loan servicer" shall not include:
        (1) a bank, savings bank, savings association, or
    credit union organized under the laws of the State or any
    other state or under the laws of the United States;
        (2) a wholly owned subsidiary of any bank, savings
    bank, savings association, or credit union organized under
    the laws of the State or any other state or under the laws
    of the United States;
        (3) an operating subsidiary where each owner of the
    operating subsidiary is wholly owned by the same bank,
    savings bank, savings association, or credit union
    organized under the laws of the State or any other state or
    under the laws of the United States;
        (4) the Illinois Student Assistance Commission and its
    agents when the agents are acting on the Illinois Student
    Assistance Commission's behalf;
        (5) a public postsecondary educational institution or
    a private nonprofit postsecondary educational institution
    servicing a student loan it extended to the borrower;
        (6) a licensed debt management service under the Debt
    Management Service Act, except to the extent that the
    organization acts as a subcontractor, affiliate, or
    service provider for an entity that is otherwise subject to
    licensure under this Act;
        (7) any collection agency licensed under the
    Collection Agency Act that is collecting post-default
    debt;
        (8) in connection with its responsibilities as a
    guaranty agency engaged in default aversion, a State or
    nonprofit private institution or organization having an
    agreement with the U.S. Secretary of Education under
    Section 428(b) of the Higher Education Act (20 U.S.C.
    1078(B)); or
        (9) a State institution or a nonprofit private
    organization designated by a governmental entity to make or
    service student loans, provided in each case that the
    institution or organization services fewer than 20,000
    student loan accounts of borrowers who reside in Illinois;
    or .
        (10) a law firm or licensed attorney that is collecting
    post-default debt.
(Source: P.A. 100-540, eff. 12-31-18.)
 
    Section 99. Effective date. This Act takes effect December
31, 2018.