This bill would require colleges and student loan contractors to clearly disclose the annual percentage rate (APR) of federal student loans to borrowers before the money is handed out. The APR disclosure must be provided in writing in a format that borrowers can keep and must account for the loan amount, interest rate, repayment timeline, any fees or costs, and how interest is compounded. The legislation affects all institutions and contractors involved in federal student lending under the Higher Education Act. While the bill does not specify new funding or enforcement mechanisms, it aims to give students better information about the true cost of borrowing federal student loans, similar to disclosures required for other types of credit. The bill was introduced in July 2024 and referred to the Senate's Health, Education, Labor, and Pensions Committee.
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