Q: What is the difference between the Student Loan Servicer License and the Automatic Student Loan Servicer License?
A: The Student Loan Servicer License is designated for any person or entity, not exempt pursuant to D.C. Official Code §§ 31-106.02, wherever located, responsible for the servicing of a student education loan to any District of Columbia student loan borrower for private student loans OR both private and non-private (federal) student loans. This license must be renewed annually.
A: Effective October 1, 2025, the Department of Insurance, Securities and Banking will accept license applications for the Automatic Student Loan Servicer License. The Automatic Student Loan Servicer License is designated for any person or entity that solely acts or solely intends to act as a student loan servicer pursuant to a contract with the United States Secretary of Education under 20 U.S.C. 1087f. The Automatic Student Loan Servicer License is an irrevocable perpetual license that shall not expire for such time as the licensee is servicing loans pursuant to a contract with the United States Secretary of Education as described above.
Q: How are applications submitted to the Banking Bureau for a student loan servicer license or automatic student loan servicer license?
A: The Banking Bureau uses the Nationwide Multistate Licensing System ("NMLS") as the system of record for non-depository, financial services licensing. The NMLS is a web-based online system for companies and individuals to apply for, amend, renew and surrender licenses. To learn more about the NMLS and to access the NMLS, please visit this link here.
Q: What are the requirements for the Student Loan Servicer License and the Automatic Student Loan Servicer License?
A: Please refer to the applicable DC New Company License Checklist available on the Checklist Compiler in the NMLS Resource Center.
Q: Is an automatic student loan servicer license required if an entity is only engaging in the servicing of federal student loans?
A: YES – Any person or entity that that solely services non-private (federal) student loans pursuant to a contract with the United States Secretary of Education is required to obtain a DC Automatic Student Loan Servicer License.
A: NO – Any person or entity that engages in both private AND non-private (federal) student loan servicing is only required to obtain the Student Loan Servicer License. The Automatic Student Loan Servicer License is designated for any person or entity that solely engages in federal student loan servicing.
A: The DC Automatic Student Loan Servicer License is perpetual. The license will immediately expire as of the date that the Automatic Student Loan Servicer is no longer servicing federal loans pursuant to a contract with the U.S. Secretary of Education. The Banking Bureau must be notified no more than seven (7) business days after the Automatic Student Loan Servicer receives notification of the expiration, revocation or termination of a contract awarded pursuant to under 20 U.S.C 1087f.
Should you have any questions regarding these FAQs or license requirements, please contact the Banking Bureau Licensing Team at [email protected] or (202) 727-8000.
If assistance is needed to navigate the NMLS, please contact the NMLS Call Center at (855) 665-7123.