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Bill > A1327
NJ A1327
NJ A1327Requires institutions of higher education and certain proprietary institutions to notify Higher Education Student Assistance Authority of approved federal borrower defense loan discharge.
summary
Introduced
01/13/2026
01/13/2026
In Committee
01/13/2026
01/13/2026
Crossed Over
Passed
Dead
Introduced Session
2026-2027 Regular Session
Bill Summary
This bill requires institutions of higher education and proprietary institutions licensed to offer academic degrees to notify the Higher Education Student Assistance Authority of approved federal borrower defense loan discharge. Under the bill, an institution which receives notice from the United States Department of Education that a former or current student is approved for borrower defense loan discharge under federal law is required to promptly notify the Executive Director of the Higher Education Student Assistance Authority. The institution is also required to inform the executive director if the student was a resident of the State at the time of the student's enrollment in the institution. Under federal law, borrower defense to repayment is a legal ground for discharging federal Direct Loans. A borrower may have a defense to repayment if an institution engaged in certain misconduct related to the making of a federal loan or the educational services provided by the institution which caused harm to a student warranting a full discharge of the student's applicable federal Direct Loans.
AI Summary
This bill mandates that colleges and universities, including for-profit institutions that grant degrees, must inform the Higher Education Student Assistance Authority (HESAA) whenever a student's federal student loan is discharged due to borrower defense. Borrower defense to repayment is a federal provision that allows students to have their federal Direct Loans forgiven if a school engaged in misconduct, such as misleading them about educational programs or loan terms, and this misconduct caused them harm. Specifically, if an institution learns from the U.S. Department of Education that a student has been approved for such a discharge, the institution must quickly notify the Executive Director of HESAA. Additionally, the institution must also report whether the student was a resident of the state when they first enrolled.
Committee Categories
Education
Sponsors (4)
Last Action
Introduced, Referred to Assembly Higher Education Committee (on 01/13/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.njleg.state.nj.us/bill-search/2026/A1327 |
| BillText | https://pub.njleg.gov/Bills/2026/A1500/1327_I1.HTM |
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