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Mortgage Servicing and Loan Modifications: 11.9.2.4 Effective Date and Retroactive Application

There is no question that the TILA limitation on arbitration agreements in mortgage loans applies to any arbitration agreement entered into after June 1, 2013. This subsection considers the enforceability of arbitration agreements entered into before that date. Two issues are examined. First, whether the TILA requirement was effective as of June 1, 2013, or July 22, 2010. Second, whichever date is used, does the provision prevent the current enforcement of arbitration agreements entered into before the effective date?

Mortgage Servicing and Loan Modifications: 11.9.2.1 Scope

The Truth in Lending Act (TILA), as amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), effectively prohibits forced arbitration of disputes involving closed-end loans secured by a dwelling and open-end loans secured by a consumer’s principal dwelling.187 TILA defines a residential mortgage loan as “a transaction in which a mortgage, deed of trust, purchase money security interest arising under an installment sales contract, or equivalent consensual security interest is created or retained against the

Mortgage Servicing and Loan Modifications: 11.9.2.2 Two Separate TILA Provisions Limit Arbitration

In covered mortgage loans, TILA prohibits any terms that require arbitration or any other non-judicial procedure as the method for resolving any controversy or settling any claims arising out of the transaction (hereinafter referred to as the “(e)(1) provision”).197 The parties can agree to arbitration or a similar procedure at any time after a dispute or claim under the transaction arises.198

Mortgage Servicing and Loan Modifications: 11.9.2.4 Effective Date and Retroactive Application

There is no question that the TILA limitation on arbitration agreements in mortgage loans applies to any arbitration agreement entered into after June 1, 2013. This subsection considers the enforceability of arbitration agreements entered into before that date. Two issues are examined. First, whether the TILA requirement was effective as of June 1, 2013, or July 22, 2010. Second, whichever date is used, does the provision prevent the current enforcement of arbitration agreements entered into before the effective date?

Fair Debt Collection: B.3.9 CFPB, Bulletin 2021-03: Consumer Reporting of Rental Information

Among other things, this guidance informs furnishers, including debt collectors, that the CFPB, “intends to look carefully at the accuracy and dispute-handling practices of furnishers providing rental information to [consumer reporting agencies (CRAs)].” It also notes that “[e]victing tenants in violation of the CDC Order, State, or local moratoria, or evicting or threatening to evict them without apprising them of their legal rights under such moratoria, may violate prohibitions against deceptive and unfair practices under the Fair Debt Collection Practices Act a

Student Loan Law: 11.2.4 Qualifying Jobs

Forgiveness is based on the employer’s eligibility, not on the type of job. Anyone working on a full-time basis for a qualifying employer at a public service organization, regardless of their job title or description, may qualify.

Student Loan Law: 11.2.5.1 The Application Process

The regulations do not explain what type of information is required at the end of the ten-year period to prove eligibility, stating only that a borrower may request loan forgiveness by filing an application approved by the Secretary.71 The Department has issued a combined certification and application form that may be used to certify employment, track credit, and apply for forgiveness.72 While annual certification is not required, a borrower must have submitted employment certification forms

Student Loan Law: 11.2.5.2 Problems with Application Processing

Borrowers first began applying for forgiveness under the PSLF Program in the fall of 2017. As of October 2022, the Department reported that it had processed discharges for 12,527 borrowers under the normal PSLF Program rules, for 6,501 borrowers under TEPSLF, and for 215,555 borrowers under the limited PSLF waiver. Out of a total of 2,897,797 PSLF application forms submitted, 55.1% were reported as complete and processed, 29% incomplete or missing information, and 16% in active processing.

Student Loan Law: 11.2.5.3 The TEPSLF Program

Congress made an initial attempt to assist borrowers who had been misled by their servicers through the Consolidated Appropriations Act in March 2018. The Act provided $350 million to fill the gap in situations where some or all of a borrower’s 120 Direct Loan payments were made under a nonqualifying repayment plan.96 The Department began administering this program—called the Temporary Expanded Public Service Loan Forgiveness (TEPSLF)—in May 2018.97

Student Loan Law: 11.2.5.4 Period of Student Loan Payment Pause Counts Toward PSLF

In March 2020, the Department of Education began providing temporary emergency relief to student loan borrowers in response to the COVID-19 pandemic. The Department’s COVID-19 emergency relief involved a number of time-limited measures, including a pause on federal student loan payments, a 0% interest rate, and stopped collections on defaulted loans—referred to as the student loan payment pause (payment pause). The payment pause initially only applied to borrowers with Direct Loans or any other Department-held student loans.

Student Loan Law: 11.2.5.5.2 The impact of the one-time IDR account adjustment on PSLF borrowers after October 2022

Although the PSLF waiver expired on October 31, 2022, the Department has stated that because the one-time IDR account adjustment policy will not be fully implemented until after December 2023, PSLF borrowers will have one more chance to see their qualifying payment count increase.117 This is because the PSLF Program rules require public service workers to make payments on their loans on either the ten-year standard repayment plan or on one of the IDR plans.

Student Loan Law: 11.2.5.6 Reconsideration Process

The Department announced in October 2021 that it was reviewing PSLF application denials for errors and providing borrowers with the ability to have their PSLF determinations reconsidered.127 These actions will help identify and address servicing errors or other issues that have prevented borrowers from getting the PSLF credit they deserve.128

Student Loan Law: 11.2.5.7 Military Deferments and PSLF

The Department announced in 2021 that it would allow active-duty servicemembers to count deferments and forbearances towards PSLF. This solves a problem for servicemembers who paused payments while on active duty but were not getting credit towards PSLF. The Department is implementing data matches to give borrowers who were on active duty credit towards PSLF without having to submit an application.131

Student Loan Law: 11.3 Teacher Loan Forgiveness

Teacher Loan Forgiveness under the FFEL and Direct Loan programs includes repayment of up to a maximum of $5000 to individuals who are full-time teachers over five consecutive years in certain schools that serve low-income families.132 The $5000 limit represents the combined total eligibility for forgiveness on the borrower’s eligible FFEL Program loans and Direct Loans.133 Only Stafford Loans and, in some cases, consolidation loans are eligible.134

Student Loan Law: 11.5 Perkins Loan Discharges

The Perkins Loan Program was the first to provide for discharges of loans for teachers in low-income school districts and for other service, including military and volunteer service. Perkins Loans may be discharged under certain circumstances, including for:

Student Loan Law: 17.2.1 Introduction

Postsecondary institutions must meet a number of requirements to receive federal financial aid funds. These requirements involve three different entities—the federal government, accrediting agencies, and states.

Student Loan Law: 20 U.S.C. § 1087e. Terms and conditions of loans

(a) In general

(1) Parallel terms, conditions, benefits, and amounts

Unless otherwise specified in this part, loans made to borrowers under this part shall have the same terms, conditions, and benefits, and be available in the same amounts, as loans made to borrowers, and first disbursed on June 30, 2010, under sections 1078, 1078-2, 1078-3, and 1078-8 of this title.

(2) Designation of loans

Student Loan Law: 20 U.S.C. § 1078-3. Federal consolidation loans

(a) Agreements with eligible lenders

(1) Agreement required for insurance coverage

For the purpose of providing loans to eligible borrowers for consolidation of their obligations with respect to eligible student loans, the Secretary or a guaranty agency shall enter into agreements in accordance with subsection (b) of this section with the following eligible lenders: