[Federal Register Volume 81, Number 85 (Tuesday, May 3, 2016)]
[Notices]
[Pages 26529-26534]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-10327]



[[Page 26529]]

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BUREAU OF CONSUMER FINANCIAL PROTECTION

[Docket No. CFPB-2016-0018]


Request for Information Regarding Student Loan Borrower 
Communications

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Notice and request for information.

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SUMMARY: The Bureau of Consumer Financial Protection (Bureau or CFPB) 
is seeking comments from the public related to consumer decision-making 
when repaying student loans, including the presentation of information 
about alternative repayment options. The submissions to this request 
for information will assist policymakers and market participants when 
considering potential options to enhance, supplement, or revise written 
communications made to student loan borrowers by student loan 
servicers, related to repayment options. The Bureau is seeking public 
comments about how these communications could reduce defaults, improve 
borrower outcomes, and spur innovation.

DATES: Comments must be received on or before June 12, 2016.

ADDRESSES: You may submit comments, identified by Docket No. CFPB-2016-
0018, by any of the following methods:
     Electronic: http://www.regulations.gov. Follow the 
instructions for submitting comments.
     Email: [email protected]. Include Docket 
No. CFPB-2016-0018 in the subject line of the message.
     Mail: Monica Jackson, Office of the Executive Secretary, 
Consumer Financial Protection Bureau, 1700 G Street NW., Washington, DC 
20552.
     Hand Delivery/Courier: Monica Jackson, Office of the 
Executive Secretary, Consumer Financial Protection Bureau, 1275 First 
Street NE., Washington, DC 20002.
    Instructions: All submissions should include the agency name and 
docket number for this proposal. Because paper mail in the Washington, 
DC area and at the Bureau is subject to delay, commenters are 
encouraged to submit comments electronically. In general, all comments 
received will be posted without change to http://www.regulations.gov. 
In addition, comments will be available for public inspection and 
copying at 1275 First Street NE., Washington, DC 20002, on official 
business days between the hours of 10 a.m. and 5 p.m. eastern time. You 
can make an appointment to inspect the documents by telephoning (202) 
435-7275.
    All comments, including attachments and other supporting materials, 
will become part of the public record and subject to public disclosure. 
Sensitive personal information, such as account numbers or social 
security numbers, should not be included. Comments generally will not 
be edited to remove any identifying or contact information.

FOR FURTHER INFORMATION CONTACT: For general inquiries, submission 
process questions, or any additional information, please contact Monica 
Jackson, Office of the Executive Secretary, at 202-435-7275.

    Authority:  12 U.S.C. 5511(c).

SUPPLEMENTARY INFORMATION: This Request for Information Regarding 
Student Loan Borrower Communications seeks feedback from the public on 
a series of potential borrower communications--Student Loan Payback 
Playbooks--developed by the Bureau in coordination with the Department 
of Education and the Department of the Treasury. The Bureau also seeks 
public comment about the role that written communications play in 
enabling successful student loan repayment.
    The submissions to this request for information may assist market 
participants and policymakers when considering potential options to 
enhance, supplement, or revise written communications provided to 
student loan borrowers, related to repayment options. Submissions will 
further inform stakeholders' understanding of the relationship between 
written communications and borrower decision-making related to student 
loan repayment, particularly as a means to reduce delinquencies and 
defaults. Comments submitted in response to this request for 
information may also be used to inform the development of certain 
disclosures required of the Department of Education by the Presidential 
Memorandum on a Student Aid Bill of Rights, signed on March 10, 
2015.\1\ The deadline for submission of comments is June 12, 2016.
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    \1\ See The White House, Presidential Memorandum--Student Aid 
Bill of Rights (Mar. 10, 2015), available at https://www.whitehouse.gov/the-press-office/2015/03/10/presidential-memorandum-student-aid-bill-rights.
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    The Bureau encourages comments from the public, including:
     Student loan borrowers;
     Organizations representing students and student loan 
borrowers;
     Innovators, technology providers, and recent entrants into 
the student loan market;
     Institutions of higher education and affiliated parties;
     Financial services providers, including but not limited to 
lenders and servicers in the student loan market;
     State law enforcement agencies and regulators;
     Participants in the consumer data industry, including 
credit reporting agencies;
     Debt collectors;
     Organizations promoting financial education;
     Civil rights groups; and
     Nationally recognized statistical rating organizations.
    Please note that the Bureau is not soliciting individual student 
account information in response to this notice and request for 
information, nor is the Bureau seeking personally identifiable 
information (PII) regarding student accounts.
    All comments, including attachments and other supporting materials, 
will become part of the public record and subject to public disclosure. 
Sensitive personal information, such as account numbers or social 
security numbers, should not be included. Comments generally will not 
be edited to remove any identifying or contact information.

Part A: Accurate and Actionable Information Related to Student Loan 
Repayment

    In May 2015, the Bureau, in coordination with the Department of 
Education and the Department of the Treasury, launched a public inquiry 
into student loan servicing practices that sought input from the public 
related to potential barriers to student loan repayment. A broad cross-
section of respondents, including consumers, student loan servicers, 
consumer advocates, and others, highlighted the lack of information 
regarding student loan repayment options as one of the potential 
barriers to borrower success.\2\ Commenters emphasized that accurate 
and actionable information about various consumer protections and 
borrower benefits could improve borrower decision-making.\3\
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    \2\ See, e.g., Borrower Comment, CFPB-2015-0021-0076 
(``[M]onthly statements are the most convoluted statements I've ever 
seen in my entire life. I work in the banking industry and I 
struggle each month to figure out what I'm supposed to be 
paying.''); Comment from Axis Financial Services, CFPB-2015-0021-
0374 (``Most defaulted borrowers need to hear about the opportunity 
and benefits of rehabilitation, affordable income-based repayment 
options, procedures for setting up a rehabilitation and answers to 
any questions the borrowers may have.''); Comment from The Institute 
for College Access & Success, CFPB-2015-0021-0356 ``[B]orrowers 
cannot count on servicers to provide information and assistance that 
could help them make affordable payments and stay out of 
default.''); Comment from Pennsylvania Higher Education Assistance 
Agency, CFPB-2015-0021-0974 (``While most borrowers are served well 
by customer service agents that are versed in a wide variety of 
student loan programs and options, some borrowers need the 
assistance of specially trained teams of representatives who can 
provide specialized information and counseling.'').
    \3\ See, e.g., Borrower Comment, CFPB-2015-0021-0996 (``Re-
payment options are not clearly stated . . . Servicers should 
include what my monthly bill payments would be if I'm considering 
different payment options.''); Borrower Comment, CFPB-2015-0021-6521 
(``I have dealt with several loan servicers and received 
inconsistent and erroneous answers to common questions. . . . 
[R]epresentatives would scream at me over the phone that I owed a 
substantial amount of money immediately, more than I could possibly 
afford to pay. I would have to hang up and call again hoping to get 
a representative that was more reasonable. The next representative 
would tell me something completely different. . . . They told me I 
do not qualify for Income-Based Repayment because I have Grad Plus 
Loans . . . This information is completely false, this restriction 
only applies to Parent Plus loans which I do not have and I do not 
exceed any income restrictions . . . . This false and inconsistent 
information led me to defer payments when I could have been making 
them under IBR.'').

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    Approximately 42 million Americans owe student loan debt.\4\ In 
less than a decade, the volume of outstanding federal student loan debt 
has more than doubled, rising from $516 billion in 2007 to greater than 
$1.2 trillion in the first quarter of 2016,\5\ surpassing all other 
categories of consumer debt aside from mortgages.
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    \4\ See U.S. Department of Education, Federal Student Aid 
Portfolio Summary (accessed on Apr. 12, 2016), available at https://studentaid.ed.gov/sa/sites/default/files/fsawg/datacenter/library/PortfolioSummary.xls.
    \5\ See U.S. Department of Education, Federal Student Aid 
Portfolio Summary (accessed on Apr. 12, 2016), available at https://studentaid.ed.gov/sa/sites/default/files/fsawg/datacenter/library/PortfolioSummary.xls.
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    Unlike other types of consumer debt, which have realized reduced 
levels of delinquency and default compared to highs reached following 
the Great Recession, the student loan market continues to show signs of 
distress.\6\ The Bureau estimates that a quarter of student loan 
borrowers are, collectively, either delinquent or in default on 
approximately $200 billion in student debt.\7\ Elevated levels of 
student loan borrower distress exist despite the availability of a 
range of protections for borrowers that are designed to mitigate 
delinquency and default, including income-driven repayment plans 
provided for by law for the vast majority of borrowers with federal 
student loans.\8\ Given the growing share of consumers managing student 
loan debt, consumers, policymakers, consumer advocates, market 
participants, policy experts, and other stakeholders have recognized 
the critical importance of consistent, accurate, and actionable 
information in order to facilitate successful repayment.\9\
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    \6\ See Federal Reserve Bank of New York, Quarterly Report on 
Household Debt and Credit (Aug. 2015), available at http://www.newyorkfed.org/householdcredit/2015-q2/data/pdf/HHDC_2015Q2.pdf.
    \7\ U.S. Department of Education, Federal Student Loan 
Portfolio: Direct Loan and Federal Family Education Loan Portfolio 
by Loan Status (accessed on Apr. 12, 2016), available at https://studentaid.ed.gov/sa/sites/default/files/fsawg/datacenter/library/PortfoliobyLoanStatus.xls; U.S. Department of Education, Federal 
Perkins Loan Program Status of Default as of June 30, 2015 (Mar. 17, 
2016), available at https://ifap.ed.gov/eannouncements/031716PerkinsCDR1415.html; U.S. Department of Education and Consumer 
Financial Protection Bureau, Private Student Loans (July 2012), 
available at http://www.consumerfinance.gov/reports/private-student-loans-report/; U.S. Department of Education, Federal Student Loan 
Portfolio: Direct Loan Portfolio by Delinquency Status (accessed on 
Apr. 12, 2016), available at https://studentaid.ed.gov/sa/sites/default/files/fsawg/datacenter/library/DLPortfoliobyDelinquencyStatus.xls; U.S. Department of Education, 
Federal Student Loan Portfolio: ED-Held FFEL Portfolio by 
Delinquency Status (accessed on Apr. 12, 2016), available at https://studentaid.ed.gov/sa/sites/default/files/fsawg/datacenter/library/EDHeldFFELPortfoliobyDelinquencyStatus.xls.
    \8\ Readers should note that access to Income-Based Repayment 
(IBR), Pay As You Earn (PAYE), and Revised Pay As You Earn (REPAYE) 
is limited to borrowers with federal loans used to finance their own 
education. Parents with federal student loans made under the Parent 
PLUS program may use another income-driven repayment plan, Income-
Contingent Repayment (ICR), but must first refinance any parent 
loans into a new Direct Consolidation Loan in order to be eligible. 
See U.S. Department of Education, Income-Driven Plans, available at 
https://studentaid.ed.gov/sa/repay-loans/understand/plans/income-driven.
    \9\ See Consumer Financial Protection Bureau, U.S. Department of 
Education, U.S. Department of the Treasury, Joint Statement of the 
Principles on Student Loan Servicing, 80 FR 67389 (Nov. 2, 2015), 
available at http://files.consumerfinance.gov/f/201509_cfpb_treasury_education-joint-statement-of-principles-on-student-loan-servicing.pdf; see also Comment from the National 
Consumer Law Center, CFPB-2015-0021-6840 (``Student loan borrowers 
lack information about the current status of their accounts and 
options for restructuring payments.); Comment from the National 
Association of Student Financial Aid Administrators, CFPB-2015-0021-
0806 (``NASFAA advocates . . . for making the consumption of the 
disclosure more efficient and user-friendly by simplifying, 
refining, and consolidating all consumer information requirements . 
. .''); Borrower Comment, CFPB-2015-0021-0996 (``Re-payment options 
are not clearly stated . . . Servicers should include what my 
monthly bill payments would be if I'm considering different 
repayment options.''); Borrower Comment, CFPB-2015-0021-0076 (``[My 
servicer's] monthly statements are the most convoluted statements 
I've ever seen in my entire life. I work in the banking industry and 
I struggle each month to figure out what I'm supposed to be 
paying.''); Comment from Axis Financial Services, CFPB-2015-0021-
0374 (``Borrowers who have recently rehabilitated loans, have fallen 
behind in payments or otherwise need special counseling need more 
support than just a monthly bill or occasional phone call. . . . 
Some borrowers may benefit from additional contact such as reminders 
via email, additional letters, invoices or call campaigns.'').
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    According to data recently released by the Department of Education 
regarding Direct Loans, borrowers in Pay As You Earn (PAYE) and Income-
Based Repayment (IBR) (the most generous income-driven repayment plans 
at the time of the snapshot) had the lowest delinquency rates. In 
contrast, borrowers enrolled in a standard 10-year repayment plan had 
delinquency rates nearly seven times higher than borrowers enrolled in 
PAYE (Figure 1).

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[GRAPHIC] [TIFF OMITTED] TN03MY16.004

    However, evidence suggests that borrowers who could benefit from 
these arrangements may end up in delinquency or default instead. One 
recent analysis by the Government Accountability Office found that 70 
percent of borrowers in default had income that would entitle them to a 
reduced monthly payment under one of these plans.\12\ Additionally, 
borrowers told us how inconsistent and incomplete information from 
servicers can be a direct impediment to successful repayment,\13\ 
noting that current written communications do not provide the 
information necessary to make informed decisions about various 
repayment options.\14\ Student loan servicers note that the expansion 
of income-driven repayment plans and other alternative options has 
introduced new challenges for servicers seeking to counsel borrowers 
about how to navigate loan repayment.\15\ One trade association 
representing the student loan servicing industry observed that the 
breadth of options available to consumers is ``so confusing as to be 
counter-productive,'' noting that this may lead to borrowers ``giving 
up or not taking action at all.'' \16\
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    \10\ See U.S. Department of Education, Federal Student Aid, 
Servicing Summit Portfolio Overview (Dec. 2014), available at http://fsaconferences.ed.gov/conferences/library/2014/servicing/2014ServicingSummitPortfolioOverview.ppt.
    \11\ Id.
    \12\ See U.S. Government Accountability Office, GAO-15-663, 
Federal Student Loans: Education could do more to help ensure 
borrowers are aware of repayment and forgiveness options (Aug. 
2015), available at http://www.gao.gov/products/GAO-15-663.
    \13\ See Request for Information on Student Loan Servicing, 
CFPB-2015-0021-0001 (May 21, 2015), available at http://www.regulations.gov/#!documentDetail;D=CFPB-2015-0021-0001; Borrower 
Comment, CFPB-2015-0021-4023 (``I was originally with [my servicer] 
when I heard about a new program . . . that would let me consolidate 
my loan and . . . since I am a teacher, I could have my loan 
forgiven after 10 years. I naturally signed right up and at the time 
they told me that the standard plan would be eligible for 
forgiveness. It turns out I received the wrong information. I would 
have to use a different [repayment] plan which would be income 
sensitive. . . . It's not fair that I got bad advice from the 
[servicer] and that I will now be paying my loan well into 
retirement.'').
    \14\ See, e.g., Borrower Comment, CFPB-2015-0021-2288 (``I was 
given wrong information about a lower payment plan. I am paying more 
on my loans, rather than a lower payment, which is causing financial 
distress. The employees of the company have given me false 
information and I'm not sure if I am on the correct repayment 
plan.'').
    \15\ See, e.g., Comment from Pennsylvania Higher Education 
Assistance Agency, CFPB-2015-0021-0974 (``Student loan borrowers and 
student loan servicers must both cope with the complex nature of 
student loans and the wide variety of terms and conditions attached 
to these loans. . . . This situation makes navigating student loans 
difficult for borrowers and presents challenges to student loan 
servicers as they attempt to counsel and assist these borrowers.'').
    \16\ Comment from Student Loan Servicing Alliance, CFPB-2015-
0021-0357 (``We believe the number of plans and the variety in their 
terms have become so confusing as to be counter-productive. Given 
the number and complexity of the plans, it is increasingly difficult 
for consumers to understand and can lead to borrowers giving up or 
not taking action at all.'').
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    These observations, taken together with other academic 
research,\17\ findings by state law enforcement agencies,\18\ and 
public comments from consumers reporting servicing problems,\19\ raise 
serious questions about the adequacy of current servicing practices 
related to enrollment in income-driven repayment plans.
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    \17\ See generally Adam Looney & Constantine Yannelis, A Crisis 
in Student Loans? How Changes in the Characteristics of Borrowers 
and in the Institutions they Attend Contributed to Rising Loan 
Defaults, BPEA Conference Draft, The Brookings Institution (Sept. 
2015), available at http://www.brookings.edu/~/media/projects/bpea/
fall-2015_embargoed/
conferencedraft_looneyyannelis_studentloandefaults.pdf (finding that 
70 percent of defaulted borrowers in the authors' sample were 
formerly enrolled at for-profit or two-year colleges, and that these 
borrowers' median wages were between $20,900-$23,900). Based on the 
Bureau's calculation, depending on a borrower's family size, the 
average borrower with these characteristics would likely be eligible 
to make a $0 monthly payment under an income-driven repayment plan.
    \18\ See, e.g., Letter from State Attorneys General Lisa Madigan 
et al., CFPB-2015-0021-0376, available at https://www.regulations.gov/#!documentDetail;D=CFPB-2015-0021-0376.
    \19\ For a complete collection of comments received in response 
to the Bureau's May 2015 Request for Information on Student Loan 
Servicing, see CFPB-2015-0021-0001, available at http://www.regulations.gov/#!docketDetail;D=CFPB-2015-0021. Public comments 
and other qualitative inputs described in this report are not 
necessarily representative of the experience of over 41 million 
borrowers in the student loan market; however, comments help to 
illustrate where there may be a mismatch between borrower needs and 
actual service delivered.
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    In response, the Bureau engaged in a joint effort with the 
Department of Education and the Department of the

[[Page 26532]]

Treasury to develop a vision for market-wide reform, including an 
emphasis on the importance of accurate and actionable information for 
borrowers seeking to make decisions about student loan repayment.\20\ 
In early 2016, in support of this effort, the Bureau engaged in a 
series of structured interviews with individual student loan borrowers 
in order to better understand the barriers student loan borrowers face 
when repaying their loans, and to identify opportunities for improving 
borrower communications about repayment options. The Bureau's initial 
observations include:
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    \20\ Consumer Financial Protection Bureau, U.S. Department of 
Education, U.S. Department of the Treasury, Joint Statement of the 
Principles on Student Loan Servicing, 80 FR 67389 (Nov. 2, 2015), 
available at http://files.consumerfinance.gov/f/201509_cfpb_treasury_education-joint-statement-of-principles-on-student-loan-servicing.pdf.

     Borrowers respond more favorably to actionable 
information. Borrowers explained that they are seeking actionable 
information regarding available repayment options. Borrowers stated 
that billing statements are difficult to understand, and not indicative 
of available alternative repayment options.
     Personalized communications may be more effective. 
Borrowers indicated that they would respond most favorably to 
personalized billing written communications that provide actionable 
repayment information reflective of a borrower's actual income and 
family size.
     Routine electronic communications may present an 
opportunity for targeted outreach. Borrowers described that they may be 
more likely to take action in response to monthly email communications 
containing personalized repayment information, rather than written 
statements instructing borrowers to log in to review their account or 
to call a customer service representative to discuss available options.
     Once borrowers fall behind, they may be less likely to 
engage with their debt. Delinquent borrowers described how they need 
some prompting to re-engage with a past-due debt; written 
communications that suggest ``business as usual'' are often ignored.

These observations, along with other qualitative and quantitative 
inputs, including responses to our May 2015 Request for Information on 
Student Loan Servicing, consumer complaints, consultation with state 
law enforcement officials, and discussions with consumer advocates, 
individual market participants, and organizations representing 
participants in the student loan servicing market, informed the 
development of a series of potential borrower Payback Playbooks 
developed by the Bureau, in coordination with the Department of 
Education and the Department of the Treasury.\21\ The Bureau is seeking 
comments discussing how these Playbooks could affect borrowers when 
evaluating available alternative repayment plans and facilitate 
enrollment in alternative repayment plans, when appropriate.\22\ The 
Bureau requests comments in response to three documents:
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    \21\ In December 2015, the Department of Education announced a 
new set of student loan billing statement disclosure requirements 
designed to provide clear and direct information to borrowers. In 
addition to enhanced disclosures while borrowers are in school, in a 
grace period, or entering repayment, borrowers will receive monthly 
statements with specific information. Additionally, delinquent 
borrowers will receive increased outreach efforts to help facilitate 
repayment. Submissions provided in response to this RFI may also 
inform the development of these disclosures. See U.S. Department of 
Education, Advancing the Student Aid Bill of Rights--An Update on 
Deliverables (Dec. 22, 2015), available at http://sites.ed.gov/ous/2015/12/advancing-the-student-aid-bill-of-rights-an-update-on-deliverables/.
    \22\ http://www.consumerfinance.gov/payback-playbook.
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     Payback Playbook A: Personalized information about 
alternative repayment options (.pdf attachment or image).
     Payback Playbook B (variant of Payback Playbook A): 
Alternate approach to personalized information about alternative 
repayment options (.pdf attachment or image).
     Payback Playbook C: Information about income-driven 
repayment options for borrowers likely at risk of default (.pdf 
attachment or image).

Part B: Questions About Written Communications to Student Loan 
Borrowers

    The Bureau is seeking general feedback on a series of draft Payback 
Playbooks that student loan servicers would send to borrowers, 
developed in collaboration with the Department of Education and the 
Department of the Treasury, as well as responses to the specific 
questions below. Section I of this Part provides a set of questions for 
respondents related to these draft Playbooks. Section II of this Part 
provides a set of questions directed to student loan borrowers related 
to Playbooks A and C. Section III of this Part provides a set of 
questions for respondents about the general communication of 
information related to student loans.

Section I: Specific Questions About Elements of Payback Playbooks A, B, 
and C

    The Bureau, in coordination with the Department of Education and 
the Department of the Treasury, developed three potential Payback 
Playbooks designed to assist student loan borrowers when selecting 
between alternative repayment plans. Playbooks A and B present three 
options to consumers: (1) Their current repayment arrangement; (2) one 
alternative repayment arrangement with an amortizing payment schedule 
(e.g., graduated repayment, extended repayment, extended-graduated 
repayment); and (3) one income-driven repayment plan (e.g., Pay As You 
Earn, Income-Based Repayment, Income-Contingent Repayment). In 
contrast, Playbook C presents a single income-driven repayment plan to 
consumers. Policymakers and market participants may wish to consider 
whether a combination of these approaches is appropriate in order to 
best serve a broad cross-section of student loan borrowers in various 
stages of repayment, experiencing varying levels of distress, and 
reflecting variations in risk levels between different segments of 
servicers' loan portfolios.
Payback Playbooks A and B
    Playbooks A and B are identical, other than the description of 
income information and estimated payment amount under an income-driven 
repayment plan. These designs present two approaches to 
personalization. One approach offers a more precise estimate of a 
monthly payment under this plan and informs the borrower that this 
estimate was derived from actual information about his or her income 
and family size. The alternative approach provides a rounded estimate 
of a borrower's likely monthly payment, based on similar information 
about income and family size used to populate Playbook A. Estimated 
payment amounts indicated in either communication require that the 
borrower's servicer have access to information about the borrower's 
income and family size. The Bureau understands that such information 
could potentially be available through various channels, including 
other government agencies. The Bureau encourages respondents to provide 
general feedback related to both approaches, as well as responses to 
any of the specific questions included below.
    1. Please provide general feedback related to Playbook A and 
Playbook B,

[[Page 26533]]

including any relevant information related to how these written 
communications could affect consumer decision-making regarding student 
loan repayment options and mitigate defaults.
    2. Please provide feedback related to specific elements of Playbook 
A and Playbook B, including, for example, feedback related to:
    a. The language used to introduce the communication;
    b. The number and selection of repayment plans presented to 
consumers;
    c. The relative emphasis on specific repayment plans;
    d. The emphasis on lowering the borrower's monthly payment amount;
    e. The presentation of the advantages and disadvantages to student 
loan borrowers associated with an alternative repayment plan with an 
amortizing repayment schedule (e.g., graduated, extended, or extended-
graduated plans);
    f. The presentation of the advantages and disadvantages to student 
loan borrowers associated with income-driven repayment plans (e.g., 
Income-Based Repayment, Pay As You Earn, and Revised Pay As You Earn);
    g. The presentation of information about the terms and conditions 
of specific repayment plans;
    h. The presentation of information regarding how borrowers can 
obtain more information about repayment options;
    i. The presentation of current and future monthly payment amounts 
for each repayment plan;
    j. The description of the costs associated with each repayment 
plan, including the depiction of future monthly payment levels and 
description of the impact of repayment plan selection on total lifetime 
loan costs;
    k. The visual representation of information contained in these 
communications; and
    l. The means by which a borrower is provided with this information 
(e.g., periodic statement, routine email communication, standalone 
written communication, online payment portal, etc.).
    3. The Bureau seeks feedback on the appropriate audience for these 
Playbooks. In particular, please provide feedback related to the 
efficacy and applicability of these Playbooks to specific populations 
of student loan borrowers, including, for example:
    a. Borrowers who are current on their student loans (i.e., have no 
past-due student loan balance);
    b. Borrowers who are at risk of delinquency;
    c. Borrowers who are delinquent on one or more student loans;
    d. Borrowers who have missed multiple monthly student loan 
payments;
    e. Borrowers who are at imminent risk of default;
    f. Borrowers who have previously been in default, including 
borrowers who have successfully rehabilitated defaulted loans;
    g. Borrowers who have high levels of student loan indebtedness;
    h. Borrowers who have not completed a program of study;
    i. Borrowers who attended certain categories of institutions of 
higher education (e.g., four-year college, community college, for-
profit college, vocational school);
    j. Borrowers who are currently enrolled in an income-driven 
repayment plan;
    k. Borrowers who are in school or in a grace period;
    l. Borrowers with Direct Loans;
    m. Borrowers with Federal Family Education Loan Program (FFELP) 
loans;
    n. Borrowers with Perkins loans;
    o. Parents with loans made through the PLUS program; and
    p. Borrowers with Federal Consolidation Loans or Direct 
Consolidation Loans.
Payback Playbook C
    Payback Playbook C provides borrowers with information on a single 
income-driven repayment plan, including a personalized description of 
the estimated monthly payment under this arrangement, similar to the 
approach used to describe income-driven repayment plans in Playbook A. 
Respondents are encouraged to evaluate this communication in the 
context of the specific needs of borrowers who are at risk of default, 
potentially including borrowers who have missed multiple monthly 
payments, borrowers who have not completed a program of study, or 
borrowers who exhibit other criteria predictive of future financial 
distress. When evaluating this communication, including the proposed 
approach to personalization, respondents are encouraged to consider the 
advantages, disadvantages, and risks associated with enrollment in an 
income-driven repayment plan, as well as the potential costs to 
borrowers resulting from delinquency and default.
    1. Please provide general feedback related to Playbook C, including 
any relevant information related to the extent to which these written 
communications could affect consumer decision-making regarding student 
loan repayment options and mitigate delinquencies or defaults.
    2. Please provide feedback related to specific elements of Playbook 
C, including, for example, feedback related to:
    a. The language used to introduce the communication;
    b. The number and selection of the repayment plan(s) presented to 
consumers;
    c. The relative emphasis on a specific repayment plan;
    d. The emphasis on lowering the borrower's monthly payment amount;
    e. The presentation of the advantages and disadvantages to student 
loan borrowers associated with income-driven repayment plans (e.g., 
Income-Based Repayment, Pay As You Earn, and Revised Pay As You Earn);
    f. The presentation of information regarding how borrowers can 
obtain more information about repayment options;
    g. The presentation of the current and future monthly amount for 
the repayment plan;
    h. The description of the cost associated with the repayment plan, 
including the depiction of future monthly payment amount and 
description of the impact of repayment plan selection on total lifetime 
loan costs;
    i. The visual representation of information contained in these 
written communications; and
    j. The means by which a borrower is provided with this information 
(e.g., periodic statement, routine email communication, stand-alone 
written communication, online payment portal, etc.).
    3. The Bureau seeks feedback on the appropriate audience for this 
Playbook. In particular, please provide feedback related to the 
efficacy and applicability of this Playbook to specific populations of 
student loan borrowers, including, for example:
    a. Borrowers who are current on their student loans (i.e., have no 
past-due student loan balance);
    b. Borrowers who are at risk of delinquency;
    c. Borrowers who are delinquent on one or more student loans;
    d. Borrowers who have missed multiple monthly student loan 
payments;
    e. Borrowers who are at imminent risk of default;
    f. Borrowers who have previously been in default, including 
borrowers who have successfully rehabilitated defaulted loans;
    g. Borrowers who have high levels of student indebtedness;
    h. Borrowers who have not completed a program of study;
    i. Borrowers who attend certain categories of institutions of 
higher

[[Page 26534]]

education (e.g., four-year college, community college, for-profit 
college, vocational school);
    j. Borrowers who are currently enrolled in an income-driven 
repayment plan;
    k. Borrowers who are in school or in a grace period;
    l. Borrowers with Direct Loans;
    m. Borrowers with Federal Family Education Loan Program (FFELP) 
loans;
    n. Borrowers with Perkins loans;
    o. Parents with loans made through the PLUS program; and
    p. Borrowers with Federal Consolidation Loans or Direct 
Consolidation Loans.

Section II. Specific Questions to Borrowers About Elements of Payback 
Playbooks A and C

    To supplement this request for information, the Bureau launched a 
consumer-facing landing page soliciting feedback on these prototype 
Payback Playbooks.\23\ The Bureau developed the following specific 
questions for individual student loan borrowers, in order to better 
understand how the Playbook could most effectively serve their needs. 
Although all commenters are encouraged to review this request for 
information in its entirety, consumers should consider following 
questions when evaluating these prototype borrower communications:
---------------------------------------------------------------------------

    \23\ http://www.consumerfinance.gov/payback-playbook.
---------------------------------------------------------------------------

    1. How would the Playbook help you understand and evaluate the 
options you have to pay your student loan if it reflected your likely 
payments based on your actual income?
    2. How could the Playbook better provide you with important 
information about your repayment options?
    3. How would it be best to see the Playbook (e.g., in monthly 
billing statements, when you log on to your account online, etc.)?
    4. At what point during repayment would you like to receive 
personalized information about available repayment options (e.g., 
during your grace period, during repayment, etc.)?

Section III: General Questions About the Communication of Information 
to Student Loan Borrowers in Repayment

    The following questions solicit input from the public about the 
effects of increased disclosure of information regarding repayment 
options in written communications to student loan borrowers from 
student loan servicers.
    1. How could personalized information related to repayment options, 
including income-driven repayment plans, affect consumer decision-
making? Personalized information means repayment information based on a 
borrower's personal information, including income and family size.
    2. Please provide any additional relevant information related to 
written communications with student loan borrowers regarding repayment 
options, including, for example:
    a. Examples of existing written communications provided to student 
loan borrowers;
    b. Information about the advantages and disadvantages of such 
communications, including any relevant information related to 
implementation, operations, and maintenance associated with 
dissemination of these communications;
    c. Information related to privacy and data security considerations 
when populating and disseminating information about borrowers' loans, 
income information, or other sensitive financial or personal 
information, including protecting the privacy of borrowers in 
electronic communications like email or text message;
    d. Feedback about information systems and other technical 
considerations when populating and disseminating personalized 
information about student loans, including any feedback about existing 
information systems that provide accurate, personalized information to 
consumers with student loans;
    e. Information about the availability, cost, and accuracy of 
potential data sources that include the income and family size of 
student loan borrowers; and
    f. Information about the use of consumer data, in order to populate 
information contained in personalized communications.
    3. How could the communication channel (e.g., U.S. Mail, email, 
SMS, online portal) used to deliver borrower communications affect 
borrower engagement (e.g., email open rates, click-through rates, 
inbound telephone calls)?
    4. How could personalized information obtained to populate written 
communications be adapted to enhance oral communications with 
consumers?
    5. Please provide any relevant information about the applicability 
of personalized communications to different segments of the student 
loan market (i.e., private student loans, guaranteed loans made under 
the Federal Family Education Loan Program, and Direct Loans).
    6. How could the visual presentation of information, including the 
presentation of additional or supplemental information in electronic 
communications, affect consumer decision-making when repaying student 
loans?

     Dated: April 25, 2016.
Richard Cordray,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2016-10327 Filed 5-2-16; 8:45 am]
BILLING CODE 4810-AM-P