State-Based Education Loan Awareness Act

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4097 Introduced in Senate (IS)]

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119th CONGRESS
  2d Session
                                S. 4097

To establish that a State-based education loan program is excluded from
    certain requirements relating to a preferred lender arrangement.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             March 16, 2026

 Ms. Murkowski (for herself, Mr. Reed, Mr. Cassidy, and Mrs. Shaheen)
introduced the following bill; which was read twice and referred to the
          Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL

To establish that a State-based education loan program is excluded from
    certain requirements relating to a preferred lender arrangement.

    Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``State-Based Education Loan Awareness
Act''.

SEC. 2. STATE-BASED EDUCATION LOAN PROGRAMS.

    Section 151 of the Higher Education Act of 1965 (20 U.S.C. 1019) is
amended--
            (1) in paragraph (8)(B)--
                    (A) in clause (i), by striking ``or'' after the
                semicolon;
                    (B) in clause (ii), by striking the period at the
                end and inserting ``; or''; and
                    (C) by adding at the end the following:
                            ``(iii) arrangements or agreements with
                        respect to education loans made under a State-
                        based education loan program.''; and
            (2) by adding at the end the following:
            ``(10) State-based education loan program.--The term
        `State-based education loan program' means an education loan
        program that--
                    ``(A) is provided by a State agency, State
                authority, or nonprofit organization, separately or
                jointly;
                    ``(B) makes loans that are not funded, insured, or
                guaranteed by the Federal Government;
                    ``(C) is authorized, established, or chartered by
                State law, or otherwise approved by the State;
                    ``(D) offers one or more loans for which the
                interest rate and fees, as calculated in accordance
                with sections 106 and 107 of the Truth in Lending Act
                (15 U.S.C. 1605; 1606), are at least as favorable as
                the interest rate and fees of the Direct PLUS loans
                authorized under part D of title IV at the time such
                loan is originated; and
                    ``(E) is available only to a borrower who has been
                advised, such as in a financial aid offer, by an
                institution of higher education (as defined under
                section 102)--
                            ``(i) that the borrower has the opportunity
                        to exhaust eligibility for Federal education
                        loans made under part D of title IV prior to
                        accepting a private education loan; and
                            ``(ii) of the interest rates, fees, and
                        benefits of such Federal education loans,
                        including income-driven repayment options,
                        opportunities for loan forgiveness, forbearance
                        or deferment options, interest subsidies, and
                        tax benefits.''.
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