January 24, 2022
The Consumer Financial Protection Bureau announced Thursday that it will begin examining the operations of postsecondary colleges, such as for-profit colleges, that extend private loans directly to students. As the CFPB begins its supervision, the exam procedures inform the industry about practices that CFPB examiners will review, including placing enrollment restrictions, withholding transcripts, improperly accelerating payments, failing to issue refunds and maintaining improper lending relationships.
“Schools that offer students loans to attend their classes have a lot of power over their students’ education and financial future,” said CFPB director Rohit Chopra. “It’s time to open up the books on institutional student lending to ensure all students with private student loans are not harmed by illegal practices.”