,,ii #aafth ,,congress #ast ,session ,s4 #adif ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,may #ae1 #bjai,mr4 ,warner 7for himself1 ,mr4 ,gardner1 ,mr4 ,kaine1 and ,mr4 ,scott of ,south ,carolina7 introduced the following bill2 which was read twice and referred to the ,committee on ,health1 ,education1 ,labor1 and ,pensions ,a ,,bill ,to amend the loan counseling requirements under the ,higher ,education ,act of #aife1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,empowering ,students ,through ,enhanced ,financial ,counseling ,act4 #b4 ,annual counseling ,section #dhe7l7 of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajib7l77 is amended to read as follows3 7l7 ,annual financial aid counseling 7#a7 ,annual disclosure required 7,a7 ,in general ,each eligible institution shall ensure that each individual who receives a ,federal ,pell ,grant or a loan made under part ,d 7other than a ,federal ,direct ,consolidation ,loan7 receives comprehensive information on the terms and conditions of such ,federal ,pell ,grant or loan and the responsibilities the individual has with respect to such ,federal ,pell ,grant or loan4 ,such information shall be provided1 for each award year for which the individual receives such ,federal ,pell ,grant or loan1 in a simple and understandable manner-- 7i7 during a counseling session conducted in person2 7ii7 online1 with the individual acknowledging receipt of the information2 or 7iii7 through the use of the online counseling tool described in subsection 7n77#a77;,b74 7,b7 ,use of interactive programs ,in the case of institutions not using the online counseling tool described in subsection 7n77#a77;,b71 the ,secretary shall require such institutions to carry out the requirements of subparagraph 7,a7 through the use of interactive programs1 during an annual counseling session that is in-person or online1 that test the individual's understanding of the terms and conditions of the ,federal ,pell ,grant or loan awarded to the individual1 using simple and understandable language and clear formatting4 7#b7 ,all individuals ,the information to be provided under paragraph 7#a77;,a7 to each individual receiving counseling under this subsection shall include the following3 7,a7 ,an explanation of how the individual may budget for typical educational expenses and a sample budget based on the cost of attendance for the institution4 7,b7 ,an explanation that an individual has a right to annually request a disclosure of information collected by a consumer reporting agency pursuant to section #fab7;a7 of the ,fair ,credit ,reporting ,act 7#ae ,u4,s4,c4 #afha;j7a774 7,c7 ,based on the most recent data available from the ,american ,community ,survey available from the ,department of ,commerce1 the estimated average income and percentage of employment in the ,state of domicile of the individual for persons with-- 7i7 a high school diploma or equivalent2 7ii7 some postsecondary education without completion of a degree or certificate2 and 7iii7 a bachelor's degree4 7,d7 ,an introduction to the financial management resources provided by the ,financial ,literacy and ,education ,commission4 7#c7 ,students receiving ,federal ,pell ,grants ,the information to be provided under paragraph 7#a77;,a7 to each student receiving a ,federal ,pell ,grant shall include the following3 7,a7 ,an explanation of the terms and conditions of the ,federal ,pell ,grant4 7,b7 ,an explanation of approved educational expenses for which the student may use the ,federal ,pell ,grant4 7,c7 ,an explanation of why the student may have to repay the ,federal ,pell ,grant4 7,d7 ,an explanation of the maximum number of semesters or equivalent for which the student may be eligible to receive a ,federal ,pell ,grant1 and a statement of the amount of time remaining for which the student may be eligible to receive a ,federal ,pell ,grant4 7,e7 ,an explanation that if the student transfers to another institution not all of the student's courses may be acceptable in transfer toward meeting specific degree or program requirements at such institution1 but the amount of time remaining for which a student may be eligible to receive a ,federal ,pell ,grant1 as provided under subparagraph 7,d71 will not change4 7,f7 ,an explanation of how the student may seek additional financial assistance from the institution's financial aid office due to a change in the student's financial circumstances1 and the contact information for such office4 7#d7 ,borrowers receiving loans made under part ,d 7other than ,parent ,,plus ,loans7 ,the information to be provided under paragraph 7#a77;,a7 to a borrower of a loan made under part ,d 7other than a ,federal ,direct ,,plus ,loan made on behalf of a dependent student7 shall include the following3 7,a7 ,to the extent practicable1 the effect of accepting the loan to be disbursed on the eligibility of the borrower for other forms of student financial assistance4 7,b7 ,an explanation of the use of the master promissory note4 7,c7 ,an explanation that the borrower is not required to accept the full amount of the loan offered to the borrower4 7,d7 ,an explanation that the borrower should consider accepting any grant1 scholarship1 or ,state or ,federal work-study jobs for which the borrower is eligible prior to accepting ,federal student loans4 7,e7 ,a recommendation to the borrower to exhaust the borrower's ,federal student loan options prior to taking out private loans1 an explanation that ,federal student loans typically offer better terms and conditions than private loans1 an explanation of treatment of loans made under part ,d and private education loans in bankruptcy1 and an explanation that if a borrower decides to take out a private education loan-- 7i7 the borrower has the ability to select a private educational lender of the borrower's choice2 7ii7 the proposed private education loan may impact the borrower's potential eligibility for other financial assistance1 including ,federal financial assistance under this title2 and 7iii7 the borrower has a right-- 7,i7 to accept the terms of the private education loan within #cj calendar days following the date on which the application for such loan is approved and the borrower receives the required disclosure documents1 pursuant to section #abh7;e77#f7 of the ,truth in ,lending ,act 7#ae ,u4,s4,c4 #afch7;e77#f772 and 7,,ii7 to cancel such loan within #c business days of the date on which the loan is consummated1 pursuant to section #abh7;e77#g7 of such ,act4 7,f7 ,an explanation of the approved educational expenses for which the borrower may use a loan made under part ,d4 7,g7 ,information on the annual and aggregate loan limits for ,federal ,direct ,stafford ,loans and ,federal ,direct ,unsubsidized ,stafford ,loans4 7,h7 ,information on how interest accrues and is capitalized during periods when the interest is not paid by either the borrower or the ,secretary4 7,i7 ,in the case of a ,federal ,direct ,,plus ,loan or a ,federal ,direct ,unsubsidized ,stafford ,loan1 the option of the borrower to pay the interest while the borrower is in school4 7,j7 ,the definition of half-time enrollment at the institution1 during regular terms and summer school1 if applicable1 and the consequences of not maintaining at least half-time enrollment4 7,k7 ,an explanation of the importance of contacting the appropriate offices at the institution of higher education if the borrower withdraws prior to completing the borrower's program of study so that the institution can provide exit counseling1 including information regarding the borrower's repayment options and loan consolidation4 7,l7 ,for a first-time borrower-- 7i7 a statement of the anticipated balance on the loan for which the borrower is receiving counseling under this subsection2 7ii7 based on such anticipated balance1 the anticipated monthly payment amount under1 at minimum-- 7,i7 the standard repayment plan2 and 7,,ii7 an income-based repayment plan under section #dic;,c1 as determined using regionally available data from the ,bureau of ,labor ,statistics of the average starting salary for the occupation in which the borrower has an interest in or intends to be employed2 and 7iii7 an estimate of the projected monthly payment amount under each repayment plan described in clause 7ii71 based on the average cumulative indebtedness at graduation for borrowers of loans made under part ,d who are in the same program of study as the borrower4 7,m7 ,for a borrower with an outstanding balance of principal or interest due on a loan made under this title-- 7i7 a current statement of the amount of such outstanding balance and interest accrued2 7ii7 based on such outstanding balance1 the anticipated monthly payment amount under1 at minimum1 the standard repayment plan and1 using regionally available data from the ,bureau of ,labor ,statistics of the average starting salary for the occupation the borrower intends to be employed1 an income-based repayment plan under section #dic;,c2 and 7iii7 an estimate of the projected monthly payment amount under each repayment plan described in clause 7ii71 based on-- 7,i7 the outstanding balance described in clause 7i72 7,,ii7 the anticipated outstanding balance on the loan for which the student is receiving counseling under this subsection2 and 7,,iii7 a projection for any other loans made under part ,d that the borrower is reasonably expected to accept during the borrower's program of study based on at least the expected increase in the cost of attendance of such program4 7,n7 ,the obligation of the borrower to repay the full amount of the loan1 regardless of whether the borrower completes or does not complete the program in which the borrower is enrolled within the regular time for program completion4 7,o7 ,the likely consequences of default on the loan1 including adverse credit reports1 delinquent debt collection procedures under ,federal law1 and litigation1 and a notice of the institution's most recent cohort default rate 7defined in section #dce7m771 an explanation of the cohort default rate1 the most recent national average cohort default rate1 and the most recent national average cohort default rate for the category of institution described in section #dce7m77#d7 to which the institution belongs4 7,p7 ,information on the ,national ,student ,loan ,data ,system and how the borrower can access the borrower's records4 7,q7 ,the contact information for the institution's financial aid office or other appropriate office at the institution the borrower may contact if the borrower has any questions about the borrower's rights and responsibilities or the terms and conditions of the loan4 7#e7 ,borrowers receiving ,parent ,,plus ,loans for dependent students ,the information to be provided under paragraph 7#a77;,a7 to a borrower of a ,federal ,direct ,,plus ,loan made on behalf of a dependent student shall include the following3 7,a7 ,the information described in subparagraphs 7,a7 through 7,c7 and 7,n7 through 7,q7 of paragraph 7#d74 7,b7 ,the option of the borrower to pay the interest on the loan while the loan is in deferment4 7,c7 ,for a first-time borrower of such loan-- 7i7 a statement of the anticipated balance on the loan for which the borrower is receiving counseling under this subsection2 7ii7 based on such anticipated balance1 the anticipated monthly payment amount under the standard repayment plan2 and 7iii7 an estimate of the projected monthly payment amount under the standard repayment plan1 based on the average cumulative indebtedness of other borrowers of ,federal ,direct ,,plus ,loans made on behalf of dependent students who are in the same program of study as the student on whose behalf the borrower borrowed the loan4 7,d7 ,for a borrower with an outstanding balance of principal or interest due on such loan-- 7i7 a statement of the amount of such outstanding balance2 7ii7 based on such outstanding balance1 the anticipated monthly payment amount under the standard repayment plan2 and 7iii7 an estimate of the projected monthly payment amount under the standard repayment plan1 based on-- 7,i7 the outstanding balance described in clause 7i72 7,,ii7 the anticipated outstanding balance on the loan for which the borrower is receiving counseling under this subsection2 and 7,,iii7 a projection for any other ,federal ,direct ,,plus ,loan made on behalf of the dependent student that the borrower is reasonably expected to accept during the program of study of such student based on at least the expected increase in the cost of attendance of such program4 7,e7 ,debt management strategies that are designed to facilitate the repayment of such indebtedness4 7,f7 ,an explanation that the borrower has the options to prepay each loan1 pay each loan on a shorter schedule1 and change repayment plans4 7,g7 ,for each ,federal ,direct ,,plus ,loan made on behalf of a dependent student for which the borrower is receiving counseling under this subsection1 the contact information for the loan servicer of the loan and a link to such servicer's website4 7#f7 ,annual loan acceptance ,prior to making the first disbursement of a loan made under part ,d 7other than a ,federal ,direct ,consolidation ,loan7 to a borrower for an award year1 an eligible institution1 shall1 as part of carrying out the counseling requirements of this subsection for the loan1 ensure that after receiving the applicable counseling under paragraphs 7#b71 7#d71 and 7#e7 for the loan the borrower accepts the loan for such award year by-- 7,a7 signing the master promissory note for the loan2 7,b7 signing and returning to the institution a separate written statement that affirmatively states that the borrower accepts the loan2 or 7,c7 electronically signing an electronic version of the statement described in subparagraph 7,b74 4 #c4 ,exit ,counseling ,section #dhe7;b7 of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajib7;b77 is amended-- 7#a7 in paragraph 7#a77;,a7-- 7,a7 in the matter preceding clause 7i71 by striking through financial aid offices or otherwise and inserting through the use of an interactive program1 during an exit counseling session that is in-person or online1 or through the use of the online counseling tool described in subsection 7n77#a77;,a72 7,b7 by redesignating clauses 7i7 through 7ix7 as clauses 7iv7 through 7xii71 respectively2 7,c7 by inserting before clause 7iv71 as redesignated by subparagraph 7,b71 the following3 7i7 a summary of the outstanding balance of principal and interest due on the loans made to the borrower under part ,b1 ,d1 or ,e2 7ii7 an explanation of the grace period preceding repayment and the expected date that the borrower will enter repayment2 7iii7 an explanation that the borrower has the option to pay any interest that has accrued while the borrower was in school or that may accrue during the grace period preceding repayment or during an authorized period of deferment or forbearance1 prior to the capitalization of the interest2 2 7,d7 in clause 7iv71 as redesignated by subparagraph 7,b7-- 7i7 by striking sample information showing the average and inserting information1 based on the borrower's outstanding balance described in clause 7i71 showing the borrower's2 and 7ii7 by striking of each plan and inserting of at least the standard repayment plan and the income-based repayment plan under section #dic;,c2 7,e7 in clause 7ix71 as redesignated by subparagraph 7,b7-- 7i7 by inserting decreased credit score1 after credit reports12 and 7ii7 by inserting reduced ability to rent or purchase a home or car1 potential difficulty in securing employment1 after ,federal law12 7,f7 in clause 7x71 as redesignated by subparagraph 7,b71 by striking consolidation loan under section #dbh;,c or a2 7,g7 in clauses 7xi7 and 7xii71 as redesignated by subparagraph 7,b71 by striking and after the semicolon2 and 7,h7 by adding at the end the following3 7xiii7 for each of the borrower's loans made under part ,b1 ,d1 or ,e for which the borrower is receiving counseling under this subsection1 the contact information for the loan servicer of the loan and a link to such servicer's website2 and 7xiv7 an explanation that an individual has a right to annually request a disclosure of information collected by a consumer reporting agency pursuant to section #fab7;a7 of the ,fair ,credit ,reporting ,act 7#ae ,u4,s4,c4 #afha;j7a774 2 7#b7 in paragraph 7#a77;,b7-- 7,a7 by inserting online or before in writing2 and 7,b7 by adding before the period at the end the following3 1 except that in the case of an institution using the online counseling tool described in subsection 7n77#a77;,a71 the ,secretary shall attempt to provide such information to the student in the manner described in subsection 7n77#c77;,c72 and 7#c7 in paragraph 7#b77;,c71 by inserting 1 such as the online counseling tool described in subsection 7n77#a77;,a71 after electronic means4 #d4 ,online counseling tools ,section #dhe of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajib7 is amended by adding at the end the following3 7n7 ,online counseling tools 7#a7 ,in general ,beginning not later than #a year after the date of enactment of the ,empowering ,students ,through ,enhanced ,financial ,counseling ,act1 the ,secretary shall maintain-- 7,a7 an online counseling tool that provides the exit counseling required under subsection 7b7 and meets the applicable requirements of this subsection2 and 7,b7 an online counseling tool that provides the annual counseling required under subsection 7l7 and meets the applicable requirements of this subsection4 7#b7 ,requirements of tools ,in maintaining the online counseling tools described in paragraph 7#a71 the ,secretary shall ensure that each such tool is-- 7,a7 consumer tested1 in consultation with other relevant ,federal agencies1 to ensure that the tool is effective in helping individuals understand their rights and obligations with respect to borrowing a loan made under part ,d or receiving a ,federal ,pell ,grant2 7,b7 understandable to students receiving ,federal ,pell ,grants and borrowers of loans made under part ,d2 and 7,c7 freely available to all eligible institutions4 7#c7 ,record of counseling completion ,the ,secretary shall-- 7,a7 use each online counseling tool described in paragraph 7#a7 to keep a record of which individuals have received counseling using the tool1 and notify the applicable institutions of the individual's completion of such counseling2 7,b7 in the case of a borrower who receives annual counseling for a loan made under part ,d using the tool described in paragraph 7#a77;,b71 notify the borrower by when the borrower should accept1 in a manner described in section #dhe7l77#f71 the loan for which the borrower has received such counseling2 and 7,c7 in the case of a borrower described in subsection 7b77#a77;,b7 at an institution that uses the online counseling tool described in paragraph 7#a77;,a7 of this subsection1 the ,secretary shall attempt to provide the information described in subsection 7b77#a77;,a7 to the borrower through such tool4 4 #e4 ,longitudinal study on the effectiveness of student loan counseling 7a7 ,in general ,not later than #a year after the date of enactment of this ,act1 the ,secretary of ,education1 acting through the ,director of the ,institute of ,education ,sciences1 shall begin conducting a rigorous1 longitudinal study of the impact and effectiveness of the student loan counseling-- 7#a7 provided under subsections 7b71 7l71 and 7n7 of section #dhe of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajib71 as amended by this ,act2 and 7#b7 provided through such other means as the ,secretary of ,education may determine4 7b7 ,contents 7#a7 ,borrower information ,the longitudinal study carried out under subsection 7a7 shall include borrower information1 in the aggregate and disaggregated by race1 ethnicity1 gender1 income1 and status as an individual with a disability1 on-- 7,a7 student persistence2 7,b7 degree attainment2 7,c7 program completion2 7,d7 successful entry into student loan repayment2 7,e7 cumulative borrowing levels2 and 7,f7 such other factors as the ,secretary of ,education may determine4 7#b7 ,exception ,the disaggregation under paragraph 7#a7 shall not be required in a case in which the number of borrowers in a category is insufficient to yield statistically reliable information or the results would reveal personally identifiable information about an individual borrower4 7c7 ,interim ,reports ,not later than #ah months after the commencement of the study under subsection 7a71 and annually thereafter1 the ,secretary of ,education shall evaluate the progress of the study and report any short-term findings to the appropriate committees of ,congress4 #f4 ,availability of funds 7a7 ,use of existing funds ,of the amount authorized to be appropriated for maintaining the ,department of ,education's ,financial ,awareness ,counseling ,tool1 #b1jjj1jjj shall be available to carry out this ,act and the amendments made by this ,act4 7b7 ,no additional funds authorized ,no funds are authorized to be appropriated by this ,act to carry out this ,act or the amendments made by this ,act4