2020 New Jersey Revised Statutes
Title 17 - Corporations and Institutions for Finance and Insurance
Section 17:16ZZ-4 - Licensure for student loan servicers.

17:16ZZ-4 Licensure for student loan servicers.

4. a. (1) No person shall act as a student loan servicer, directly or indirectly, without first obtaining a license from the commissioner under subsection b. of this section, unless that person is exempt from licensure pursuant to paragraph (2) of this subsection.

(2) The following persons are exempt from subsection a. of this section: (a) any State or federally chartered bank, savings bank, savings and loan association, or credit union; (b) any wholly owned subsidiary of any bank or credit union; and (c) any operating subsidiary where each owner of the operating subsidiary is wholly owned by the same bank or credit union.

b. Any person seeking to act within this State as a student loan servicer shall make a written application to the commissioner for an initial license in the form prescribed by the commissioner utilizing the Nationwide Mortgage Licensing System and Registry. The application shall be accompanied by:

(1) a financial statement prepared by a certified public accountant or a public accountant, the accuracy of which is sworn to under oath before a notary public by the applicant, proprietor, a general partner or a corporate officer, or a member duly authorized to execute those documents;

(2) (a) the history of criminal convictions of the: (i) applicant; (ii) partners, if the applicant is a partnership; (iii) members, if the applicant is a limited liability company or association; or (iv) officers, directors and principal employees, if the applicant is a corporation; and

(b) sufficient information pertaining to the history of criminal convictions of that applicant, partners, members, officers, directors or principal employees as the commissioner deems necessary to make the findings under subsection c. of this section;

(3) a nonrefundable license fee of $5,000;

(4) a nonrefundable investigation fee in such amount as determined by the commissioner; and

(5) a fee paid to the Nationwide Mortgage Licensing System and Registry as established by that entity.

The commissioner may conduct a State and national criminal history records check of the applicant and of each partner, member, officer, director and principal employee of the applicant.

c. Upon the filing of an application for an initial license and the payment of the fees for license and investigation, the commissioner shall investigate the financial condition and responsibility, financial and business experience, character and general fitness of the applicant. The commissioner may issue a license if the commissioner finds that:

(1) the applicant's financial condition is sound;

(2) the applicant's business will be conducted honestly, fairly, equitably, carefully and efficiently within the purposes and intent of this act, and in a manner commanding the confidence and trust of the community;

(3) (a) if the applicant is an individual, the individual is in all respects properly qualified and of good character;

(b) if the applicant is a partnership, each partner is in all respects properly qualified and of good character;

(c) if the applicant is a corporation or association, the president, chairperson of the executive committee, senior officer responsible for the corporation's business and chief financial officer or any other person who performs similar functions as determined by the commissioner, each director, each trustee and each shareholder owning 10 percent or more of each class of the securities of the corporation is in all respects properly qualified and of good character; or

(d) if the applicant is a limited liability company, each member is in all respects properly qualified and of good character;

(4) neither the applicant nor any person on behalf of the applicant knowingly has made any incorrect statement of a material fact in the application, or in any report or statement made pursuant to this act;

(5) neither the applicant nor any person on behalf of the applicant knowingly has omitted to state any material fact necessary to give the commissioner any information lawfully required by the commissioner;

(6) the applicant has paid the investigation fee and the license fee required under subsection b. of this section; and

(7) the applicant has met any other similar requirements as determined by the commissioner.

d. A license issued pursuant to subsection c. of this section shall expire at the close of business on December 31 of the year of its issuance, unless renewed or earlier surrendered, suspended or revoked pursuant to this act. Not later than 15 days after a licensee ceases to engage in the business of student loan servicing in this State for any reason, including a business decision to terminate operations in this State, license revocation, bankruptcy or voluntary dissolution, the licensee shall provide written notice of surrender to the commissioner and shall surrender to the commissioner its license for each location in which the licensee has ceased to engage in business. The written notice of surrender shall identify the location where the records of the licensee will be stored and the name, address and telephone number of an individual authorized to provide access to the records. The surrender of a license does not reduce or eliminate the licensee's civil or criminal liability arising from acts or omissions occurring prior to the surrender of the license, including any administrative actions undertaken by the commissioner to revoke or suspend a license, assess a civil penalty, order restitution or exercise any other authority provided to the commissioner.

e. A license may be renewed for the ensuing 12-month period upon the filing of an application containing all required documents and fees as provided in subsection b. of this section. The renewal application shall be filed on or before December 1 of the year in which the license expires. Any renewal application filed with the commissioner after December 1 shall be accompanied by a late fee of $100 per day. A license will not be renewed until the license fee and any applicable late fees have been received. If an application for a renewal license has been filed with the commissioner on or before the date the license expires, the license sought to be renewed shall continue in full force and effect until the issuance by the commissioner of the renewal license applied for or until the commissioner has notified the licensee in writing of the commissioner's refusal to issue the renewal license together with the grounds upon which that refusal is based. The commissioner may refuse to issue a renewal license on any ground on which the commissioner might refuse to issue an initial license.

f. The applicant or licensee shall notify the commissioner, in writing, of any change in the information provided in its initial application for a license or its most recent renewal application for the license, as applicable, not later than 10 business days after the occurrence of the event that results in the information becoming inaccurate.

g. The commissioner may deem an application for a license abandoned if the applicant fails to respond to any request for information required under this act. The commissioner shall notify the applicant, in writing, that if the applicant fails to submit any information not later than 60 days after the date on which the request for information was made, the application shall be deemed abandoned. An application filing fee paid prior to the date an application is deemed abandoned pursuant to this subsection shall not be refunded. Abandonment of an application pursuant to this subsection shall not preclude the applicant from submitting a new application for a license under the provisions of this act.

L.2019, c.200, s.4.