|Received:||5/22/2006 8:48:02 PM|
|Subject:||Procedures to Enhance the Accuracy and Integrity of Information Furnished to Consumer Reporting Agencies|
|Title:||Advance Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Parts 660 and 661|
Comments:Clarify that student loan guarantors are subject to FDCPA and FCRA. Their accounts, by definition, are delinquent accounts and therefore already have a commencement of delinquency date when the defaulted loan is assumed. Clarify their responsibility to obtain from the original lender the commencement of delinquency date that led to the default and to accurately report that date when first reporting the trade line. Clarify that they are not exempt from the mandate to obtain verification from the original lender and forward to the consumer when a loan or any portion thereof is disputed, to include not only copy of the original promissory not, but a detailed accounting of the payment history, broken down by principal, interest, and such other costs are collection costs. Former borrowers, and consumers who find student loans that do not belong to them on their reports, have no recourse when guarantors stonewall them. Common practice, at least in regards to Texas Guaranteed Student Loan Corporation (TG Collections) is to produce the kind of computer printout that has already been ruled insufficient to validate a debt. Such printout routinely and false details monthly statements alleged to be produced by TG beginning with the claim paid date. Such a printout fails to validate the pmt history of a former borrower. The fact that a claim was paid does not mean the account didn't end up in the default accounts in error. Students have no recourse when the original lender feels no obligation to respond to a request for an accounting of payment history. The guarantor refuses to provide an accounting or even discuss the issue. The federal ombudsman's office is of no use when they parrot the guarantor's information regarding claim paid date and amount. Who, if anyone, is responsible for insuring former borrowers are not being penalized for loans that are already paid in full? Resolution is to: (1) require or clarify that the original lender must be responsive to consumer's request for an accounting of the loan; (2) require or clarify that the guarantor is held to the same standard as other data furnishers in their requirement to obtain a detailed accounting from the original lender and forward that to the consumer, upon request; and (3) require or clarify guarantors and/or other holders of defaulted loans are responsible for reporting accurately the commencement of delinquency date that led to the default so that the integrity of the seven year reporting calendar is maintained.