CFPB-SLSA
Servicer Workgroup
EFC/NCHER Legal Meeting
New York City
August 5, 2013
Student Loan Servicing Alliance
Background
CFPB agenda is very consumer complaint driven
– When borrowers don’t understand a process, it can lead to an
inquiry or a complaint
The CFPB approach with these meetings has been that
“where there is smoke, there may be fire….” but willing
to admit that “the smoke may in fact be fog”
Certain preconceptions coming into these meetings
– Tendency to think in terms of mortgage practices
– Consumer bias
Servicers’ opportunity to explain and set the record
straight
Best practices discussion
Student Loan Servicing Alliance
Process
10 servicers in workgroup
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Mix of large and medium-sized
Bank and non-bank
For profit and not-for-profit
Private loans and FFELP loans
Weekly internal group calls to discuss servicing
practices and specific questions raised by the CFPB
Issue papers looking at existing statutory and regulatory
requirements, and comparable mortgage requirements
Surveys
Student Loan Servicing Alliance
Process
3-4 face-to-face ½ day meetings with the CFPB
Personnel from several offices
– Office of Installment and Liquidity Lending Markets
(Research, Markets and Regulations Division)
– Office of Students
– Office of Servicemember Affairs
– Office of Consumer Response
– Unlike supervision so far, no one from Enforcement! 
Use of PowerPoint overviews on each topic
All information marked “Business Information”
Follow-up questions
Student Loan Servicing Alliance
Limitations on Discussion
Use of surveys helped in avoiding specific
servicers having to talk about how they do
something
– “All” of the servicers in the group vs. “the majority”
or “most” of the servicers in the group
FSA aware of the workgroup and instructed
servicers not to discuss their role as DL
servicers and contractors to ED
Student Loan Servicing Alliance
Issues
Payment Posting
– Online delays
– Obstacles for posting as of receipt date
Prepayment
– Due date advance and principal reduction
Standardization of servicemember information
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Identifying and servicing servicemember borrowers
Servicemembers Civil Relief Act (SCRA)
Other benefits
Intergovernmental
Student Loan Servicing Alliance
Issues
ACH – Account transfers
– Technology issues
– Legal transfer of the authorization authority
Repayment Options for FFELP and Private Loans
– Disclosure of options
Servicing transfers and notification process
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Intercompany technology issues
Borrower communication issues
Timing issues
Misdirected payment issues
RESPA model
Student Loan Servicing Alliance
Outcome
We hope that the CFPB has gained
valuable insights into the hows and whys
of certain servicing practices
This new knowledge should inform their
supervision of student loan servicers and
help reduce issues in their supervision
activities
Improved consumer education efforts
Student Loan Servicing Alliance
Questions?
Winkie Crigler
Executive Director, SLSA
202-955-6055
wpcrigler@slsa.net
Student Loan Servicing Alliance