A. 6226--B 2
(A) IS NOT MADE, INSURED, OR GUARANTEED UNDER TITLE IV OF THE HIGHER
EDUCATION ACT OF 1965 (20 U.S.C. 1070 ET SEQ.);
(B) IS EXTENDED TO A CONSUMER EXPRESSLY, IN WHOLE OR IN PART, FOR
HIGHER EDUCATION EXPENSES, REGARDLESS OF WHETHER THE LOAN IS PROVIDED BY
THE EDUCATIONAL INSTITUTION THAT THE STUDENT ATTENDS;
(C) DOES NOT INCLUDE OPEN-END CREDIT OR ANY LOAN THAT IS SECURED BY
REAL PROPERTY OR A DWELLING; AND
(D) DOES NOT INCLUDE AN EXTENSION OF CREDIT IN WHICH THE COVERED
EDUCATIONAL INSTITUTION IS THE CREDITOR IF:
(I) THE TERM OF THE EXTENSION OF CREDIT IS NINETY DAYS OR LESS; OR
(II) AN INTEREST RATE OR FINANCE CHARGE WILL NOT BE APPLIED TO THE
CREDIT BALANCE AND THE TERM OF THE EXTENSION OF CREDIT IS ONE YEAR OR
LESS, EVEN IF THE CREDIT IS PAYABLE IN MORE THAN FOUR INSTALLMENTS.
2. "PRIVATE EDUCATION LENDER", EXCEPT AS EXEMPTED UNDER THIS ARTICLE,
MEANS:
(A) ANY PERSON OR ENTITY ENGAGED IN THE BUSINESS OF SECURING, MAKING,
OR EXTENDING PRIVATE EDUCATION LOANS; OR
(B) ANY HOLDER OF A PRIVATE EDUCATION LOAN.
3. "BORROWER" OR "PRIVATE EDUCATION LOAN BORROWER" MEANS A PERSON WHO
HAS RECEIVED OR AGREED TO PAY A PRIVATE EDUCATION LOAN FOR HIS OR HER
OWN EDUCATIONAL EXPENSES.
4. "COSIGNER" (A) MEANS:
(I) ANY INDIVIDUAL WHO IS LIABLE FOR THE OBLIGATION OF ANOTHER WITHOUT
COMPENSATION, REGARDLESS OF HOW DESIGNATED IN THE CONTRACT OR INSTRUMENT
WITH RESPECT TO THAT OBLIGATION, INCLUDING AN OBLIGATION UNDER A PRIVATE
EDUCATION LOAN EXTENDED TO CONSOLIDATE A BORROWER'S PRE-EXISTING PRIVATE
EDUCATION LOANS; AND
(II) INCLUDES ANY PERSON THE SIGNATURE OF WHICH IS REQUESTED AS CONDI-
TION TO GRANT CREDIT OR TO FORBEAR ON COLLECTION;
(B) DOES NOT INCLUDE A SPOUSE OF AN INDIVIDUAL DESCRIBED IN SUBPARA-
GRAPH (I) OF PARAGRAPH (A) OF THIS SUBDIVISION, THE SIGNATURE OF WHOM IS
NEEDED TO PERFECT THE SECURITY INTEREST IN A LOAN.
5. "ORIGINAL CREDITOR" MEANS THE PRIVATE EDUCATION LENDER IDENTIFIED
IN A PROMISSORY NOTE, LOAN AGREEMENT, OR LOAN CONTRACT ENTERED INTO WITH
A PRIVATE EDUCATION LOAN BORROWER OR COSIGNER.
6. "CREDITOR" MEANS:
(A) THE ORIGINAL CREDITOR, WHERE OWNERSHIP OF A PRIVATE EDUCATION LOAN
DEBT HAS NOT BEEN SOLD, ASSIGNED, OR TRANSFERRED;
(B) THE PERSON OR ENTITY THAT OWNED THE PRIVATE EDUCATION LOAN DEBT AT
THE TIME THE DEBT BECAME DELINQUENT OR DEFAULTED, EVEN IF THAT PERSON OR
ENTITY DID NOT ORIGINATE THE PRIVATE EDUCATION LOAN, AND WHERE SUCH A
DEBT HAS NOT SUBSEQUENTLY BEEN SOLD, TRANSFERRED OR ASSIGNED; OR
(C) A PERSON OR ENTITY THAT PURCHASED A DELINQUENT OR DEFAULTED
PRIVATE EDUCATION LOAN DEBT FOR COLLECTION PURPOSES, WHETHER IT COLLECTS
THE DEBT ITSELF, HIRES A THIRD PARTY FOR COLLECTION, OR HIRES AN ATTOR-
NEY FOR COLLECTION LITIGATION.
7. "DEBT COLLECTOR" MEANS ANY PERSON WHO REGULARLY COLLECTS OR
ATTEMPTS TO COLLECT, DIRECTLY OR INDIRECTLY, CONSUMER DEBTS ORIGINALLY
OWED OR DUE OR ASSERTED TO BE OWED OR DUE ANOTHER. THE TERM DOES NOT
INCLUDE ANY OFFICER OR EMPLOYEE OF A CREDITOR WHO, IN THE NAME OF THE
CREDITOR, COLLECTS DEBTS FOR SUCH CREDITOR, BUT IT DOES INCLUDE ANY
CREDITOR WHO, IN THE PROCESS OF COLLECTING ITS OWN DEBTS, USES ANY NAME
OTHER THAN ITS OWN WHICH WOULD INDICATE THAT A THIRD PERSON IS COLLECT-
ING OR ATTEMPTING TO COLLECT SUCH DEBTS.
8. "HIGHER EDUCATION EXPENSE" MEANS ANY EXPENSE ARISING FROM HIGHER
EDUCATION, AS DEFINED IN SECTION TWO OF THE EDUCATION LAW, REGARDLESS OF
A. 6226--B 3
WHETHER THE HIGHER EDUCATION INSTITUTION IS ACCREDITED WITHIN NEW YORK
STATE.
§ 1101. APPLICABILITY. 1. ANY PERSON OR ENTITY THAT ENTERS INTO A
CONTRACT OR SUBCONTRACT WITH A PRIVATE EDUCATION LENDER OR SERVICER TO
PERFORM THE SERVICING OF A PRIVATE EDUCATION LOAN MUST FULFILL THE OBLI-
GATIONS OF THE PRIVATE EDUCATION LENDER UNDER THIS ARTICLE.
2. ANY PRIVATE EDUCATION LENDER AS DESCRIBED IN SUBDIVISION TWO OF
SECTION ELEVEN HUNDRED OF THIS ARTICLE BE JOINTLY AND SEVERALLY LIABLE
FOR THE ACTIONS OF THE ENTITY OR PERSON IN FULFILLING THE OBLIGATIONS OF
THE PRIVATE EDUCATIONAL LENDER OR SERVICER UNDER THIS ARTICLE.
§ 1102. EXEMPT ORGANIZATIONS. THE FOLLOWING SHALL BE EXEMPT FROM THE
PROVISIONS OF THIS ARTICLE ONLY TO THE EXTENT THAT STATE REGULATION IS
PREEMPTED BY FEDERAL LAW:
1. ANY BANKING ORGANIZATION, FOREIGN BANKING CORPORATION, NATIONAL
BANK, FEDERAL SAVINGS ASSOCIATION, FEDERAL CREDIT UNION, OR ANY BANK,
TRUST COMPANY, SAVINGS BANK, SAVINGS AND LOAN ASSOCIATION, OR CREDIT
UNION ORGANIZED UNDER THE LAWS OF ANY OTHER STATE; AND
2. ANY SUBSIDIARY OF SUCH ENTITIES SET FORTH IN SUBDIVISION ONE OF
THIS SECTION.
§ 1103. PROVISIONS APPLICABLE TO COSIGNERS. 1. (A) PRIOR TO THE ORIGI-
NATION OF A PRIVATE EDUCATION LOAN, THE PRIVATE EDUCATION LENDER SHALL
PROVIDE TO ALL COSIGNER APPLICANTS INFORMATION ABOUT THE RIGHTS AND
RESPONSIBILITIES OF THE COSIGNER OF THE LOAN, INCLUDING:
(I) INFORMATION ABOUT HOW THE PRIVATE EDUCATION LENDER WILL FURNISH
INFORMATION ABOUT THE COSIGNER'S PRIVATE EDUCATION LOAN OBLIGATION TO
CREDIT REPORTING AGENCIES;
(II) INFORMATION ABOUT HOW THE COSIGNER WILL BE NOTIFIED IF THE
PRIVATE EDUCATION LOAN BECOMES DELINQUENT, INCLUDING HOW THE COSIGNER
CAN CURE THE DELINQUENCY IN ORDER TO AVOID NEGATIVE CREDIT FURNISHING
AND LOSS OF COSIGNER RELEASE ELIGIBILITY; AND
(III) INFORMATION ABOUT ELIGIBILITY FOR RELEASE OF THE COSIGNER'S
OBLIGATION ON THE PRIVATE EDUCATION LOAN, INCLUDING NUMBER OF ON-TIME
PAYMENTS AND ANY OTHER CRITERIA REQUIRED TO APPROVE THE RELEASE OF
COSIGNER FROM THE LOAN OBLIGATION.
(B) LENDERS SHALL SEND BORROWERS AND COSIGNERS ANNUAL WRITTEN NOTICES
CONTAINING INFORMATION ABOUT COSIGNER RELEASE, INCLUDING CRITERIA THE
LENDER REQUIRES TO APPROVE THE RELEASE OF COSIGNER FROM THE LOAN OBLI-
GATION AND THE PROCESS FOR APPLYING FOR COSIGNER RELEASE.
(C) ONCE THE BORROWER HAS MET THE APPLICABLE CONSECUTIVE ON-TIME
PAYMENT REQUIREMENT TO BE ELIGIBLE FOR COSIGNER RELEASE, THE LENDER
SHALL SEND THE BORROWER AND COSIGNER A WRITTEN NOTIFICATION BY U.S. MAIL
AND BY ELECTRONIC MAIL, WHERE A BORROWER HAS ELECTED TO RECEIVE ELEC-
TRONIC COMMUNICATIONS FROM THE LENDER, INFORMING THE BORROWER AND COSIG-
NER THAT HE OR SHE HAS MET THE APPLICABLE CONSECUTIVE, ON-TIME PAYMENTS
REQUIREMENT TO BE ELIGIBLE FOR COSIGNER RELEASE. THE NOTIFICATION SHALL
ALSO INCLUDE INFORMATION ABOUT ANY ADDITIONAL CRITERIA TO QUALIFY FOR
COSIGNER RELEASE, AND THE PROCEDURE TO APPLY FOR COSIGNER RELEASE.
(D) LENDERS SHALL PROVIDE WRITTEN NOTICE WITHIN FIFTEEN DAYS TO ANY
BORROWER WHO APPLIES FOR COSIGNER RELEASE, BUT WHOSE APPLICATION IS
INCOMPLETE. THE WRITTEN NOTICE MUST INCLUDE A DESCRIPTION OF THE INFOR-
MATION NEEDED TO CONSIDER THE APPLICATION COMPLETE AND THE DATE BY WHICH
THE APPLICANT SHOULD FURNISH THE MISSING INFORMATION.
(E) AFTER A BORROWER SUBMITS A COMPLETE APPLICATION FOR COSIGNER
RELEASE, WITHIN THIRTY DAYS, THE LENDER SHALL SEND THE BORROWER AND
COSIGNER A WRITTEN NOTICE THAT INFORMS THE BORROWER AND COSIGNER WHETHER
THE COSIGNER RELEASE APPLICATION HAS BEEN APPROVED OR DENIED. IF THE
A. 6226--B 4
LENDER DENIES A REQUEST FOR COSIGNER RELEASE, THE LENDER SHALL INFORM
THE BORROWER OF HIS OR HER RIGHT TO REQUEST ALL DOCUMENTS AND INFORMA-
TION USED IN THE DETERMINATION, INCLUDING THE CREDIT SCORE THRESHOLD
USED BY THE LENDER, THE BORROWER'S CONSUMER REPORT, THE BORROWER'S CRED-
IT SCORE, AND ANY OTHER DOCUMENTS SPECIFIC TO THE BORROWER. THE LENDER
MUST ALSO PROVIDE ANY ADVERSE ACTION NOTICES REQUIRED UNDER APPLICABLE
FEDERAL LAW IF THE DENIAL IS BASED IN WHOLE OR IN PART ON ANY INFORMA-
TION CONTAINED IN A CONSUMER REPORT.
2. (A) IN RESPONSE TO ANY WRITTEN OR ORAL REQUEST FOR COSIGNER
RELEASE, LENDERS SHALL SEND THE INFORMATION DESCRIBED IN PARAGRAPH (B)
OF SUBDIVISION ONE OF THIS SECTION.
(B) LENDERS SHALL NOT IMPOSE ANY RESTRICTIONS THAT MAY PERMANENTLY BAR
A BORROWER FROM QUALIFYING FOR COSIGNER RELEASE, INCLUDING RESTRICTING
THE NUMBER OF TIMES A BORROWER MAY APPLY FOR COSIGNER RELEASE.
(C) LENDERS SHALL NOT IMPOSE ANY NEGATIVE CONSEQUENCES ON ANY BORROWER
OR COSIGNER DURING THE SIXTY DAYS FOLLOWING THE ISSUANCE OF THE NOTICE
REQUIRED UNDER PARAGRAPH (D) OF SUBDIVISION ONE OF THIS SECTION, OR
UNTIL THE LENDER MAKES A FINAL DETERMINATION ABOUT A BORROWER'S COSIGNER
RELEASE APPLICATION. FOR THE PURPOSE OF THIS PARAGRAPH, "NEGATIVE CONSE-
QUENCES" INCLUDES, BUT IS NOT LIMITED TO, THE IMPOSITION OF ADDITIONAL
ELIGIBILITY CRITERIA, NEGATIVE CREDIT REPORTING, LOST ELIGIBILITY FOR
COSIGNER RELEASE, LATE FEES, INTEREST CAPITALIZATION, OR OTHER FINANCIAL
INJURY.
(D) LENDERS SHALL NOT REQUIRE GREATER THAN TWELVE CONSECUTIVE, ON-TIME
PAYMENTS AS CRITERIA TO APPLY FOR COSIGNER RELEASE. ANY BORROWER WHO HAS
PAID THE EQUIVALENT OF TWELVE MONTHS OF PRINCIPAL AND INTEREST PAYMENTS
WITHIN ANY TWELVE-MONTH PERIOD WILL BE CONSIDERED TO HAVE SATISFIED THE
CONSECUTIVE, ON-TIME PAYMENT REQUIREMENT, EVEN IF THE BORROWER HAS NOT
MADE PAYMENTS MONTHLY DURING THE TWELVE-MONTH PERIOD.
(E) IF A BORROWER OR COSIGNER REQUESTS A CHANGE THAT RESTARTS THE
COUNT OF CONSECUTIVE, ON-TIME PAYMENTS REQUIRED FOR COSIGNER RELEASE,
THE LENDER SHALL NOTIFY THE BORROWER AND COSIGNER IN WRITING WITHIN TEN
DAYS OF THE IMPACT OF SUCH AN ARRANGEMENT AND PROVIDE THE BORROWER OR
COSIGNER THE RIGHT TO WITHDRAW OR REVERSE THE REQUEST TO AVOID SUCH
IMPACT.
(F) THE BORROWER HAS THE RIGHT TO REQUEST AN APPEAL OF A LENDER'S
DETERMINATION TO DENY THE COSIGNER RELEASE APPLICATION WITHIN NINETY
DAYS OF RECEIVING THE LENDER'S DETERMINATION, AND THE LENDER SHALL
PERMIT SUCH BORROWER TO SUBMIT ADDITIONAL DOCUMENTATION EVIDENCING THAT
THE BORROWER HAS THE ABILITY, WILLINGNESS, AND STABILITY TO HANDLE HIS
OR HER PAYMENT OBLIGATIONS. THE BORROWER MAY REQUEST REVIEW OF THE
COSIGNER RELEASE DETERMINATION BY ANOTHER EMPLOYEE. THE LENDER SHALL
INFORM THE BORROWER OF THIS RIGHT IN A CLEAR AND CONSPICUOUS MANNER ON
THE NOTICE DENYING THE COSIGNER RELEASE APPLICATION.
(G) A LENDER MUST ESTABLISH AND MAINTAIN A COMPREHENSIVE RECORD
MANAGEMENT SYSTEM REASONABLY DESIGNED TO ENSURE THE ACCURACY, INTEGRITY,
AND COMPLETENESS OF DATA AND OTHER INFORMATION ABOUT COSIGNER RELEASE
APPLICATIONS. THIS SYSTEM SHALL INCLUDE THE NUMBER OF COSIGNER RELEASE
APPLICATIONS RECEIVED, THE APPROVAL AND DENIAL RATE, AND THE PRIMARY
REASONS FOR ANY DENIAL.
(H) IF A COSIGNER HAS A TOTAL AND PERMANENT DISABILITY, AS DETERMINED
BY ANY FEDERAL AGENCY, STATE AGENCY, OR PHYSICIAN OR DOCTOR OF OSTEOPA-
THY LEGALLY AUTHORIZED TO PRACTICE IN THE STATE IN WHICH THE COSIGNER
RESIDES, THE LENDER SHALL RELEASE THE COSIGNER FROM THE COSIGNER'S OBLI-
GATION TO REPAY THE LOAN UPON RECEIVING A NOTIFICATION OF THE COSIGNER'S
TOTAL AND PERMANENT DISABILITY. THE LENDER SHALL NOT REQUIRE A NEW
A. 6226--B 5
COSIGNER TO BE ADDED TO THE LOAN AFTER THE ORIGINAL COSIGNER HAS BEEN
RELEASED FROM THE LOAN.
3. (A) A LENDER SHALL PROVIDE A COSIGNER OF A PRIVATE EDUCATION LOAN
WITH ACCESS TO ALL DOCUMENTS OR RECORDS RELATED TO THE COSIGNED PRIVATE
EDUCATION LOAN THAT ARE AVAILABLE TO THE BORROWER;
(B) IF A LENDER PROVIDES ELECTRONIC ACCESS TO DOCUMENTS AND RECORDS
FOR A BORROWER, IT SHALL PROVIDE EQUIVALENT ELECTRONIC ACCESS TO THE
COSIGNER; AND
(C) UPON RECEIVING NOTICE FROM THE BORROWER OR COSIGNER, THE LENDER
SHALL REDACT THE CONTACT INFORMATION OF THE OTHER PARTY.
§ 1104. PROHIBITION ON ACCELERATION OF PAYMENTS ON PRIVATE EDUCATION
LOANS. 1. EXCEPT AS PROVIDED IN SUBDIVISION TWO OF THIS SECTION, A
PRIVATE EDUCATION LOAN EXECUTED AFTER THE EFFECTIVE DATE OF THIS ARTICLE
MAY NOT INCLUDE A PROVISION THAT PERMITS THE PRIVATE EDUCATIONAL LENDER
TO ACCELERATE, IN WHOLE OR IN PART, PAYMENTS ON THE PRIVATE EDUCATION
LOAN.
2. A PRIVATE EDUCATION LOAN MAY INCLUDE A PROVISION THAT PERMITS
ACCELERATION OF THE LOAN IN CASES OF PAYMENT DEFAULT.
3. A LENDER SHALL NOT PLACE ANY LOAN OR ACCOUNT INTO DEFAULT OR ACCEL-
ERATE A LOAN FOR ANY REASON, OTHER THAN FOR FAILURE TO PAY.
4. (A) IN THE EVENT OF THE DEATH OF A COSIGNER, A LENDER SHALL NOT
ATTEMPT TO COLLECT AGAINST THE COSIGNER'S ESTATE, OTHER THAN FOR FAILURE
TO PAY.
(B) UPON RECEIVING NOTIFICATION OF THE DEATH OR BANKRUPTCY OF A COSIG-
NER, WHEN THE LOAN IS NOT MORE THAN SIXTY DAYS DELINQUENT AT THE TIME OF
THE NOTIFICATION, A LENDER SHALL NOT CHANGE ANY TERMS OR BENEFITS UNDER
THE PROMISSORY NOTE, REPAYMENT SCHEDULE, REPAYMENT TERMS, OR MONTHLY
PAYMENT AMOUNT OR ANY OTHER PROVISION ASSOCIATED WITH THE LOAN.
(C) A LENDER SHALL NOT PLACE ANY LOAN OR ACCOUNT INTO DEFAULT OR
ACCELERATE A LOAN FOR ANY REASON, OTHER THAN FOR FAILURE TO PAY.
§ 1105. REQUIRED COMMUNICATIONS FROM CREDITORS AND DEBT COLLECTORS.
IN ADDITION TO ANY OTHER INFORMATION REQUIRED UNDER APPLICABLE FEDERAL
OR STATE LAW, A CREDITOR OR DEBT COLLECTOR SHALL PROVIDE, IN WRITING, IN
THE FIRST DEBT COLLECTION COMMUNICATION WITH THE PRIVATE EDUCATION LOAN
BORROWER OR COSIGNER, OR WITHIN FIVE DAYS THEREAFTER, AND AT ANY OTHER
TIME THE BORROWER OR COSIGNER REQUESTS SUCH DOCUMENTATION:
1. THE NAME OF THE CURRENT OWNER OF THE PRIVATE EDUCATION LOAN DEBT;
2. THE ORIGINAL CREDITOR'S NAME AT THE TIME OF ORIGINATION AND, IF
DIFFERENT, AT THE TIME OF SALE OF THE LOAN, IF APPLICABLE;
3. THE ORIGINAL CREDITOR'S ACCOUNT NUMBER USED TO IDENTIFY THE PRIVATE
EDUCATION LOAN DEBT AT THE TIME OF SALE, IF APPLICABLE;
4. THE TOTAL OUTSTANDING AMOUNT OWED AT THE TIME OF DEFAULT OR THE
AMOUNT DUE TO BRING THE LOAN CURRENT IF THE LOAN IS DELINQUENT, BUT NOT
YET IN DEFAULT;
5. A SCHEDULE OF ALL TRANSACTIONS CREDITED OR DEBITED TO THE PRIVATE
EDUCATION LOAN ACCOUNT;
6. A COPY OF ALL PAGES OF THE CONTRACT, APPLICATION OR OTHER DOCUMENTS
STATING ALL TERMS AND CONDITIONS APPLICABLE TO THE PRIVATE EDUCATION
LOAN AND EVIDENCING THE PRIVATE EDUCATION LOAN BORROWER'S OR COSIGNER'S
LIABILITY FOR THE PRIVATE EDUCATION LOAN; AND
7. A CLEAR AND CONSPICUOUS STATEMENT DISCLOSING THAT THE BORROWER OR
COSIGNER HAS A RIGHT TO REQUEST ALL INFORMATION POSSESSED BY THE CREDI-
TOR RELATED TO THE PRIVATE EDUCATION LOAN DEBT, INCLUDING, BUT NOT
LIMITED TO THE INFORMATION INCLUDED IN SECTION ELEVEN HUNDRED SIX OF
THIS ARTICLE.
A. 6226--B 6
§ 1106. REQUIRED INFORMATION TO BE PROVIDED BY CREDITORS AND DEBT
COLLECTORS. 1. A CREDITOR OR DEBT COLLECTOR MAY NOT COLLECT OR ATTEMPT
TO COLLECT A PRIVATE EDUCATION LOAN DEBT UNLESS THE CREDITOR OR DEBT
COLLECTOR POSSESSES THE FOLLOWING:
(A) THE NAME OF THE OWNER OF THE PRIVATE EDUCATION LOAN;
(B) THE ORIGINAL CREDITOR'S NAME AT THE TIME OF SALE OF THE LOAN OR
DEFAULT, IF APPLICABLE;
(C) THE ORIGINAL CREDITOR'S ACCOUNT NUMBER USED TO IDENTIFY THE
PRIVATE EDUCATION LOAN AT THE TIME OF SALE OR DEFAULT, IF THE ORIGINAL
CREDITOR USED AN ACCOUNT NUMBER TO IDENTIFY THE PRIVATE EDUCATION LOAN
AT THE TIME OF SALE OR DEFAULT;
(D) THE AMOUNT DUE AT THE TIME OF SALE, OR AT DEFAULT, OR, IF THE LOAN
IS DELINQUENT, TO BRING THE LOAN CURRENT;
(E) A SCHEDULE OF ALL TRANSACTIONS CREDITED OR DEBITED TO THE PRIVATE
EDUCATION LOAN ACCOUNT;
(F) AN ITEMIZATION OF INTEREST AND FEES, IF ANY, CLAIMED TO BE OWED
AND WHETHER THOSE WERE IMPOSED BY THE ORIGINAL CREDITOR OR ANY SUBSE-
QUENT OWNERS OF THE PRIVATE EDUCATION LOAN;
(G) THE DATE THAT THE PRIVATE EDUCATION LOAN WAS INCURRED;
(H) A BILLING STATEMENT OR OTHER ACCOUNT RECORD INDICATING THE DATE OF
THE FIRST PARTIAL PAYMENT AND/OR THE FIRST DAY THAT A PAYMENT WAS
MISSED, WHICHEVER IS EARLIER;
(I) A BILLING STATEMENT OR OTHER ACCOUNT RECORD INDICATING THE DATE OF
THE LAST PAYMENT MADE BY THE BORROWER OR COSIGNER, IF APPLICABLE;
(J) ANY PAYMENTS, SETTLEMENT, OR FINANCIAL REMUNERATION OF ANY KIND
PAID TO THE CREDITOR BY A GUARANTOR, COSIGNER, OR SURETY, AND THE AMOUNT
OF PAYMENT RECEIVED;
(K) A COPY OF THE SELF-CERTIFICATION FORM AND ANY OTHER "NEEDS ANALY-
SIS" CONDUCTED BY THE ORIGINAL CREDITOR PRIOR TO ORIGINATION OF THE
LOAN;
(L) A LOG OF ALL COLLECTION ATTEMPTS MADE IN THE PREVIOUS TWELVE
MONTHS INCLUDING DATE AND TIME OF ALL CALLS AND WRITTEN COMMUNICATIONS;
(M) COPIES OF ALL WRITTEN SETTLEMENT OFFERS SENT IN THE LAST TWELVE
MONTHS, OR, IN THE ALTERNATIVE, A STATEMENT THAT THE CREDITOR HAS NOT
ATTEMPTED TO SETTLE OR OTHERWISE RENEGOTIATE THE DEBT PRIOR TO SUIT;
(N) COPIES OF ALL COLLECTION LETTERS SENT TO THE BORROWER AND COSIGNER
SINCE INCEPTION OF THE LOAN;
(O) DOCUMENTATION ESTABLISHING THAT THE CREDITOR IS THE OWNER OF THE
SPECIFIC INDIVIDUAL PRIVATE EDUCATION LOAN AT ISSUE. IF THE PRIVATE
EDUCATION LOAN WAS ASSIGNED MORE THAN ONCE, THE CREDITOR MUST POSSESS
EACH ASSIGNMENT OR OTHER WRITING EVIDENCING THE TRANSFER OF OWNERSHIP OF
THE SPECIFIC INDIVIDUAL PRIVATE EDUCATION LOAN TO ESTABLISH AN UNBROKEN
CHAIN OF OWNERSHIP, BEGINNING WITH THE ORIGINAL CREDITOR TO THE FIRST
SUBSEQUENT CREDITOR AND EACH ADDITIONAL CREDITOR. EACH ASSIGNMENT OR
OTHER WRITING EVIDENCING TRANSFER OF OWNERSHIP OR THE RIGHT TO COLLECT
MUST CONTAIN THE ORIGINAL CREDITOR'S ACCOUNT NUMBER (REDACTED FOR SECU-
RITY PURPOSES TO SHOW ONLY THE LAST FOUR DIGITS) OF THE PRIVATE EDUCA-
TION LOAN PURCHASED OR OTHERWISE ASSIGNED, THE DATE OF PURCHASE AND
ASSIGNMENT, AND MUST CLEARLY SHOW THE BORROWER'S, AND IF APPLICABLE,
COSIGNER'S CORRECT NAME ASSOCIATED WITH THE ORIGINAL ACCOUNT NUMBER. THE
ASSIGNMENT OR OTHER WRITING ATTACHED SHALL BE THAT BY WHICH THE CREDITOR
OR OTHER ASSIGNEE ACQUIRED THE PRIVATE EDUCATION LOAN, NOT A DOCUMENT
PREPARED FOR LITIGATION OR COLLECTION PURPOSES;
(P) A COPY OF ALL PAGES OF THE CONTRACT, APPLICATION OR OTHER DOCU-
MENTS EVIDENCING THE PRIVATE EDUCATION LOAN BORROWER'S, AND IF APPLICA-
A. 6226--B 7
BLE, COSIGNER'S LIABILITY FOR THE PRIVATE EDUCATION LOAN, STATING ALL
TERMS AND CONDITIONS APPLICABLE TO THE PRIVATE EDUCATION LOAN; AND
(Q) A SIGNED AFFIDAVIT OR AFFIDAVITS FROM EACH OF THE PREVIOUS OWNERS
OF THE PRIVATE EDUCATION LOAN REGARDING WHEN THE PREVIOUS OWNER ACCELER-
ATED THE LOAN FROM DELINQUENCY STATUS TO DEFAULT STATUS, OR IF APPLICA-
BLE, A STATEMENT THAT NO SUCH ACCELERATION OCCURRED.
2. UPON WRITTEN OR ORAL REQUEST FROM A BORROWER OR COSIGNER FOR ANY
INFORMATION THAT A CREDITOR OR DEBT COLLECTOR IS REQUIRED TO POSSESS
PURSUANT TO SUBDIVISION ONE OF THIS SECTION, A CREDITOR OR DEBT COLLEC-
TOR SHALL SEND THE REQUESTED INFORMATION TO THE BORROWER OR COSIGNER
WITHIN FIFTEEN DAYS OF RECEIPT OF THE REQUEST.
§ 1107. ENFORCEMENT. 1. ALL PRIVATE EDUCATION LENDERS, CREDITORS AND
DEBT COLLECTORS SHALL COMPLY WITH THE PROVISIONS OF THIS ARTICLE.
2. ANY BORROWER OR COSIGNER WHO SUFFERS DAMAGE AS A RESULT OF THE
FAILURE OF A PRIVATE EDUCATION LENDER, CREDITOR, OR DEBT COLLECTOR
COVERED BY THE PROVISION OF THIS ARTICLE MAY BRING AN ACTION ON THEIR
OWN BEHALF AND ON BEHALF OF A SIMILARLY SITUATED CLASS OF CONSUMERS
AGAINST THAT PERSON TO RECOVER OR OBTAIN ANY OF THE FOLLOWING:
(A) ACTUAL DAMAGES, BUT IN NO CASE SHALL THE TOTAL AWARD OF DAMAGES BE
LESS THAN FIVE HUNDRED DOLLARS PER PERSON, PER VIOLATION OF THIS SECTION
OR OF SECTION THREE THOUSAND TWELVE-C OF THE CIVIL PRACTICE LAW AND
RULES;
(B) PUNITIVE DAMAGES;
(C) CORRECTION OF ANY INACCURATE, NEGATIVE REPORTING BY THE LENDER,
CREDITOR, OR DEBT COLLECTOR TO ANY CREDIT REPORTING AGENCY;
(D) INJUNCTIVE RELIEF; AND
(E) ANY OTHER RELIEF THAT THE COURT DEEMS PROPER.
3. IF A CREDITOR OR DEBT COLLECTOR FAILS TO COMPLY WITH SUBDIVISION
(E) OF SECTION THREE THOUSAND TWELVE-C OF THE CIVIL PRACTICE LAW AND
RULES, THE BORROWER OR THE COSIGNER WHO SENT THE WRITTEN NOTICE THEREIN
MAY BRING AN ACTION ON HIS OR HER OWN BEHALF OR ON BEHALF OF A SIMILARLY
SITUATED CLASS OF PERSONS AGAINST THE CREDITOR OR DEBT COLLECTOR AND MAY
RECOVER OR OBTAIN ANY OF THE SAME FORMS OF RELIEF AS PROVIDED IN SUBDI-
VISION TWO OF THIS SECTION, AS WELL AS AN ORDER SETTING ASIDE OR VACAT-
ING ANY JUDGMENT ENTERED AGAINST THE BORROWER OR COSIGNER. IN ADDITION
TO ANY OTHER REMEDIES PROVIDED BY THIS SECTION OR OTHERWISE PROVIDED BY
LAW, WHENEVER IT IS PROVEN BY A PREPONDERANCE OF THE EVIDENCE THAT A
CREDITOR, DEBT COLLECTOR, OR ATTORNEY REPRESENTING A CREDITOR OR DEBT
COLLECTOR FILED AN AFFIDAVIT REQUIRED UNDER SECTION THREE THOUSAND
TWELVE-C OF THE CIVIL PRACTICE LAW AND RULES CONTAINING FALSE INFORMA-
TION, THE COURT SHALL AWARD TREBLE ACTUAL DAMAGES TO THE BORROWER OR
COSIGNER, BUT IN NO CASE SHALL THE AWARD OF DAMAGES BE LESS THAN ONE
THOUSAND FIVE HUNDRED DOLLARS, PER PERSON, PER VIOLATION OF THAT
SECTION.
4. IN THE CASE OF ANY SUCCESSFUL ACTION TO ENFORCE THE FOREGOING
LIABILITY, A PRIVATE EDUCATION LENDER, CREDITOR, OR DEBT COLLECTOR IS
LIABLE FOR THE COSTS OF THE ACTION, TOGETHER WITH REASONABLE ATTORNEYS'
FEES AS DETERMINED BY THE COURT.
5. THE ATTORNEY GENERAL OR THE DISTRICT ATTORNEY OF ANY COUNTY MAY
BRING AN ACTION IN THE NAME OF THE PEOPLE OF THE STATE TO RESTRAIN OR
PREVENT ANY VIOLATION OF THIS ARTICLE OR ANY CONTINUANCE OF ANY SUCH
VIOLATION.
6. NOTHING IN THIS ARTICLE SHALL LIMIT ANY STATUTORY OR COMMON LAW
RIGHT OF ANY PERSON TO BRING ANY ACTION IN ANY COURT FOR ANY ACT, OR THE
RIGHT OF THE STATE TO PUNISH ANY PERSON FOR ANY VIOLATION OF ANY LAW.
A. 6226--B 8
§ 1108. RULES AND REGULATIONS. 1. IN ADDITION TO SUCH POWERS AS MAY
OTHERWISE BE PRESCRIBED BY THIS CHAPTER, THE SUPERINTENDENT OF FINANCIAL
SERVICES IS HEREBY AUTHORIZED AND EMPOWERED TO PROMULGATE SUCH RULES AND
REGULATIONS AS MAY IN THE JUDGMENT OF THE SUPERINTENDENT BE CONSISTENT
WITH THE PURPOSES OF THIS ARTICLE, OR APPROPRIATE FOR THE EFFECTIVE
ADMINISTRATION OF THIS ARTICLE, INCLUDING, BUT NOT LIMITED TO:
(A) SUCH RULES AND REGULATIONS IN CONNECTION WITH THE ACTIVITIES OF
PRIVATE EDUCATION LENDERS, CREDITORS, AND DEBT COLLECTORS AS MAY BE
NECESSARY AND APPROPRIATE FOR THE PROTECTION OF BORROWERS IN THIS STATE;
(B) SUCH RULES AND REGULATIONS AS MAY BE NECESSARY AND APPROPRIATE TO
DEFINE UNFAIR, DECEPTIVE OR ABUSIVE ACTS OR PRACTICES IN CONNECTION WITH
THE ACTIVITIES OF PRIVATE EDUCATION LENDERS, CREDITORS, AND DEBT COLLEC-
TORS;
(C) SUCH RULES AND REGULATIONS AS MAY DEFINE THE TERMS USED IN THIS
ARTICLE AND AS MAY BE NECESSARY AND APPROPRIATE TO INTERPRET AND IMPLE-
MENT THE PROVISIONS OF THIS ARTICLE; AND
(D) SUCH RULES AND REGULATIONS AS MAY BE NECESSARY FOR THE ENFORCEMENT
OF THIS ARTICLE.
2. THE SUPERINTENDENT IS HEREBY AUTHORIZED AND EMPOWERED TO MAKE SUCH
SPECIFIC RULINGS, DEMANDS AND FINDINGS AS THE SUPERINTENDENT MAY DEEM
NECESSARY FOR THE PROPER CONDUCT OF THE PRIVATE EDUCATION LOAN INDUSTRY.
§ 1109. PENALTIES. IN ADDITION TO SUCH PENALTIES AS MAY OTHERWISE BE
APPLICABLE BY LAW, INCLUDING BUT NOT LIMITED TO THE PENALTIES AVAILABLE
UNDER SECTION FORTY-FOUR OF THE BANKING LAW, THE SUPERINTENDENT OF
FINANCIAL SERVICES MAY, AFTER NOTICE AND A HEARING, OR UPON A FINDING OF
A VIOLATION OF THIS ARTICLE IN A CIVIL ACTION BROUGHT BY THE ATTORNEY
GENERAL, REQUIRE ANY PERSON FOUND VIOLATING THE PROVISIONS OF THIS ARTI-
CLE OR THE RULES OR REGULATIONS PROMULGATED HEREUNDER TO PAY TO THE
PEOPLE OF THIS STATE A PENALTY FOR EACH VIOLATION OF THE ARTICLE OR ANY
REGULATION OR POLICY PROMULGATED HEREUNDER A SUM NOT TO EXCEED THE
GREATER OF (I) TEN THOUSAND DOLLARS FOR EACH OFFENSE; (II) A MULTIPLE OF
TWO TIMES THE AGGREGATE DAMAGES ATTRIBUTABLE TO THE VIOLATION; OR (III)
A MULTIPLE OF TWO TIMES THE AGGREGATE ECONOMIC GAIN ATTRIBUTABLE TO THE
VIOLATION.
§ 2. Subdivision (q-1) of section 105 of the civil practice law and
rules, as added by chapter 593 of the laws of 2021, is amended to read
as follows:
(q-1) Original creditor. The term "original creditor" means the entity
that owned a consumer credit account at the date of default giving rise
to a cause of action, EXCEPT THAT IF THE CONSUMER CREDIT ACCOUNT IS A
PRIVATE EDUCATION LOAN, AS DEFINED IN SUBDIVISION ONE OF SECTION ELEVEN
HUNDRED OF THE GENERAL BUSINESS LAW, "ORIGINAL CREDITOR" MEANS THE
PRIVATE EDUCATION LENDER IDENTIFIED IN A PROMISSORY NOTE, LOAN AGREE-
MENT, OR LOAN CONTRACT ENTERED INTO WITH A PRIVATE EDUCATION LOAN
BORROWER OR COSIGNER.
§ 3. The civil practice law and rules is amended by adding a new
section 3012-c to read as follows:
§ 3012-C. PLEADING REQUIREMENTS IN PRIVATE EDUCATION LOAN ACTIONS. IN
ADDITION TO ANY OTHER PAPERS AND DOCUMENTS REQUIRED BY THIS CHAPTER, IN
AN ACTION ARISING OUT OF A PRIVATE EDUCATION LOAN:
(A) ACCOMPANYING THE COMPLAINT, ONE OR MORE SWORN AFFIDAVITS BY A
REPRESENTATIVE OF THE PLAINTIFF OR PLAINTIFF'S ATTORNEY SHALL BE
ATTACHED TO THE COMPLAINT ATTESTING:
(1) THAT THE PLAINTIFF HAS IN ITS POSSESSION THE INFORMATION REQUIRED
IN SUBDIVISION ONE OF SECTION ELEVEN HUNDRED SIX OF THE GENERAL BUSINESS
LAW;
A. 6226--B 9
(2) THAT THE COMMUNICATION REQUIRED IN SECTION ELEVEN HUNDRED FIVE OF
THE GENERAL BUSINESS LAW HAS BEEN COMPLIED WITH;
(3) AS TO WHETHER THE DEBT IS ELIGIBLE FOR AN INCOME-BASED REPAYMENT
PLAN FREE OF CHARGE TO THE BORROWER OR COSIGNER, EQUIVALENT TO THE
REPAYMENT ARRANGEMENT ESTABLISHED FOR FEDERAL STUDENT LOANS UNDER ARTI-
CLE IV OF THE HIGHER EDUCATION ACT (20 USC 1078 ET. SEQ.);
(4) WHETHER, AFTER REASONABLE INQUIRY, THE PLAINTIFF OR THE
PLAINTIFF'S ATTORNEY HAS REASON TO BELIEVE THAT THE DEBT IS A QUALIFIED
EDUCATION LOAN AS DEFINED IN 26 U.S.C. § 221; AND
(5) THAT THE INFORMATION SET FORTH IN PARAGRAPH ONE OF THIS SUBDIVI-
SION, THE ALLEGATIONS SET FORTH IN THE COMPLAINT AND ANY SUPPORTING
AFFIDAVITS OR AFFIRMATIONS, AS WELL AS THE NOTARIZATIONS CONTAINED IN
THE SUPPORTING DOCUMENTS FILED THEREWITH, ARE ACCURATE.
(B) COPIES OF THE DOCUMENTATION IDENTIFIED IN PARAGRAPHS (O) AND (Q)
OF SUBDIVISION ONE OF SECTION ELEVEN HUNDRED SIX OF THE GENERAL BUSINESS
LAW SHALL BE ATTACHED TO THE COMPLAINT. THE REQUIREMENTS OF THIS SUBDI-
VISION SHALL SATISFY THOSE REQUIRED FOR AN ACTION ARISING OUT OF A
CONSUMER CREDIT TRANSACTION, PURSUANT TO SUBDIVISION (F) OF SECTION 3215
OF THIS CHAPTER, WHERE THE PLAINTIFF IS NOT THE ORIGINAL CREDITOR, AS
DEFINED IN SECTION 105 OF THIS CHAPTER.
(C) AN AFFIDAVIT BY THE PLAINTIFF OR PLAINTIFF'S ATTORNEY SHALL ACCOM-
PANY THE COMPLAINT, STATING THAT AFTER REASONABLE INQUIRY, HE OR SHE HAS
REASON TO BELIEVE THAT THE STATUTE OF LIMITATIONS HAS NOT EXPIRED.
COMPLIANCE WITH THIS SUBDIVISION SHALL SATISFY THE PROVISIONS OF
SUBDIVISION (J) OF SECTION 3215 OF THIS CHAPTER FOR AN ATTORNEY REPRES-
ENTING A CREDITOR SEEKING A JUDGMENT BY DEFAULT ENTERED BY THE CLERK IN
AN ACTION ARISING FROM A PRIVATE EDUCATION LOAN DEBT.
(D) A JUDGE OR CLERK SHALL NOT GRANT OR ENTER A JUDGMENT PURSUANT TO
RULE 3212 OR SECTIONS 3213, 3215 OR 3218 OF THIS CHAPTER IN AN ACTION
ARISING FROM A PRIVATE EDUCATION LOAN DEBT THAT DOES NOT COMPLY WITH THE
REQUIREMENTS DESCRIBED IN SUBDIVISIONS (A), (B), AND (C) OF THIS
SECTION.
(E) UPON RECEIPT OF WRITTEN NOTICE PROVIDED BY A BORROWER OR COSIGNER,
OR UPON NOTICE FROM THE ATTORNEY GENERAL OR SUPERINTENDENT OF FINANCIAL
SERVICES ON BEHALF OF A GROUP OF BORROWERS, TO A CREDITOR OR DEBT
COLLECTOR STATING THAT THE CREDITOR OR DEBT COLLECTOR HAS FAILED TO
COMPLY WITH THIS SECTION, THE CREDITOR OR DEBT COLLECTOR SHALL:
(I) PROVIDE PROOF OF COMPLIANCE WITH THE PROVISIONS OF THIS SECTION;
OR
(II) TAKE THE FOLLOWING ACTIONS:
1. MOVE TO VACATE THE JUDGMENT;
2. REFUND ALL MONIES PAID BY THE BORROWER OR COSIGNER AFTER THE JUDG-
MENT WAS ENTERED; AND
3. CORRECT ANY INACCURATE, NEGATIVE CREDIT INFORMATION FURNISHED BY
THE CREDITOR OR DEBT COLLECTOR.
(F) THE DEFINITIONS OF TERMS SET FORTH IN SECTION ELEVEN HUNDRED OF
THE GENERAL BUSINESS LAW SHALL APPLY TO THE PROVISIONS OF THIS SECTION.
§ 4. Section 3213 of the civil practice law and rules, as amended by
chapter 593 of the laws of 2021, is amended to read as follows:
§ 3213. Motion for summary judgment in lieu of complaint. When an
action is based upon an instrument for the payment of money only or upon
any judgment, the plaintiff may serve with the summons a notice of
motion for summary judgment and the supporting papers in lieu of a
complaint. The summons served with such motion papers shall require the
defendant to submit answering papers on the motion within the time
provided in the notice of motion. The minimum time such motion shall be
A. 6226--B 10
noticed to be heard shall be as provided by subdivision (a) of rule 320
for making an appearance, depending upon the method of service. If the
plaintiff sets the hearing date of the motion later than the minimum
time therefor, he may require the defendant to serve a copy of his
answering papers upon him within such extended period of time, not
exceeding ten days, prior to such hearing date. No default judgment may
be entered pursuant to subdivision (a) of section 3215 prior to the
hearing date of the motion. If the motion is denied, the moving and
answering papers shall be deemed the complaint and answer, respectively,
unless the court orders otherwise. The additional notice required by
subdivision (j) of rule 3212 shall be applicable to a motion made pursu-
ant to this section in any action to collect a debt arising out of a
consumer credit transaction where a consumer is a defendant. THE ADDI-
TIONAL PLEADING REQUIRED BY SECTION 3012-C SHALL BE APPLICABLE TO A
MOTION MADE PURSUANT TO THIS SECTION IN ANY ACTION TO COLLECT A DEBT
ARISING OUT OF A PRIVATE EDUCATION LOAN, AS DEFINED IN SECTION ELEVEN
HUNDRED OF THE GENERAL BUSINESS LAW.
§ 5. Severability. If any clause, sentence, paragraph, subdivision,
section or part of this act shall be adjudged by any court of competent
jurisdiction to be invalid, such judgment shall not affect, impair, or
invalidate the remainder thereof, but shall be confined in its operation
to the clause, sentence, paragraph, subdivision, section or part thereof
directly involved in the controversy in which such judgment shall have
been rendered. It is hereby declared to be the intent of the legislature
that this act would have been enacted even if such invalid provisions
had not been included herein.
§ 6. This act shall take effect on the sixtieth day after it shall
have become a law; provided that if chapter 593 of the laws of 2021
shall not have taken effect on or before such date then sections two and
four of this act shall take effect on the same date and in the same
manner as such chapter 593 of the laws of 2021 takes effect.