Our education finance clients look to us for advice on state licensing issues, and we assist them in obtaining the licenses relevant to their business models. Many of those business models take the form of bank partner lending programs and we advise clients using that business model on “true-lender” issues related to the structure of those programs. In addition, our lawyers are well-versed in analyzing the applicability of state licensing laws to our education finance clients’ business activities, including the growing number of private education lender, holder, and servicer laws. We also advise our clients on operational strategies to navigate, and potentially lessen, their licensing burdens. Our lawyers work hand-in-hand with a team of McGlinchey licensing professionals who have more than 30 years of experience preparing, filing, and obtaining the relevant lender, broker, or servicer licenses for our education finance clients. Clients benefit from our strong relationships with licensing agencies.

Our state licensing experience includes:

• efficient acquisition and renewal
• change of control and officers
• state examination and reporting

Learn more about McGlinchey's Licensing team.

We also have experience advising our clients on compliance issues related to the permissible use of consumer data obtained from their own loan program experiences and data obtained from other sources, particularly in the development of marketing programs. Our experience includes developing informational security programs that comply with federal Safeguard Rules and the consumer privacy laws that have been enacted in an increasing number of states, such as California and Virginia. In the event this information is impermissibly accessed, our lawyers have advised clients on investigating data security breaches and the resulting insurance, regulatory, and consumer legal issues.

Our lawyers regularly advise education finance companies on post-origination issues that are unique to their industry, including:

• co-signer release requirements
• student loan forgiveness and associated tax implications
• state private education lending activity reporting
• responses to borrowers who request information about their private loans

Directly related is our work to help lender and servicing clients comply with federal and state laws that regulate their servicing and communication activities, including call frequency standards and content requirements for print and electronic communications.

In addition to our experience developing and expanding private education programs, our lawyers routinely are asked to audit existing programs for compliance with federal and state law. If we identify issues that require remediation, we work alongside our clients to proactively implement changes to mitigate legal and reputational risk.

Our experience in the education finance industry is unmatched. We have advised clients through the entire lifecycle of a private education loan program, from inception to litigation, and regularly provide daily compliance advice on the practical legal issues that our clients experience.

• Advised multiple private education lenders in the development of in-school and refinance programs, including drafting their program guidelines, service agreements, and consumer-facing documents.
• Advised non-profit state-sponsored entities, bank, and non-bank lenders on program integration with origination servicers and life-of-loan servicers.
• Assisted clients in developing private education loan payment relief options, including forbearance and deferrals.
• Advised clients on the applicability of state lending and servicing laws to private education lenders, including interest rate limitations, permitted fees and charges, application of payment requirements, and repayment term limitations.
• Drafted private education loan credit applications, disclosures, and promissory notes.
• Drafted consumer-facing correspondence, including adverse action notices, servicing letters, and marketing materials, used in private education lending programs.
• Advised multiple non-profit state-sponsored entities, banks, and non-bank lenders on federal and state servicemember compliance issues, including applying relief afforded by the Military Lending Act (MLA) and Servicemembers Civil Relief Act (SCRA).
• Performed compliance reviews of vendor consumer-facing communications, including billing statements, servicing and collection letters, and telephone scripts, to evaluate legal risk and implement revisions to reduce legal risk.
• Negotiated and drafted marketing, servicing, and loan purchase agreements between private education lenders and third parties.
• Advised numerous clients on implementing E-Sign enrollment to support online private education loan applications and electronic payments.
• Advised clients on Telephone Consumer Protection Act (TCPA) requirements applicable to private education loan marketing and servicing communications.
• Advised FinTech and bank lending partner programs on innovative private education loan programs, including fair lending risk and allocation of responsibilities between program participants.
• Represented institutional loan guarantors in adversary proceedings where a borrower seeks to discharge student loan obligations.
• Represented clients in defensive litigation matters and in connection with government investigations relating to education finance.

Our Education Finance attorneys are part of McGlinchey’s nationally-recognized team of Consumer Financial Services Compliance attorneys and licensing analysts, with 30 years of demonstrated success providing comprehensive counsel to financial institutions of all shapes and sizes. We are one of the only law firms with a national licensing practice that can handle the entire lifecycle of a company’s licensing needs, from the preparation of license applications, responding to deficiencies, advocating for our clients before licensing examiners, effectuating changes in control, and renewals. Our licensing practice is rooted in this deep history and experience, but is also propelled forward to navigate the growing number of states that license private education lenders, holders, and servicers.

Our legal team’s tenure in the field allows us to hit the ground running to develop and grow private education loan programs. This experience, coupled with our creativity, helps our clients evaluate opportunities such as FinTech partnerships and refinance programs and implement changes required by evolving state regulations.

Learn more about McGlinchey's nationally-recognized Consumer Financial Services Compliance team.