Bill > S01991

This bill modifies existing banking law to require a more comprehensive and transparent standard financial aid award letter for students. Specifically, the bill mandates that the financial aid award letter now include detailed information about loan repayment, such as the estimated loan repayment impact using actual terms, expected repayment schedule, and payoff amounts. If specific loan details are not available, the letter must provide a standard ten-year repayment term with an assumed interest rate, total expected payoff amount (including principal and interest), and expected monthly payment. The bill aims to help students better understand the long-term financial implications of their student loans by requiring institutions to use a standardized letter that clearly breaks down costs, financial aid sources, expected contributions, graduation rates, borrowing rates, and loan default rates. All colleges, vocational institutions, and other educational programs offering approved programs must use this standardized letter when responding to undergraduate financial aid applicants, beginning with the 2016-2017 academic year. The superintendent of financial services, in consultation with the president of the higher education services corporation, is responsible for developing and publishing this standard letter.