What's happening
This bill requires New York financial aid award letters to include detailed loan repayment estimates, including monthly payments and total payoff.
Why it matters
Gives students a clearer picture of real debt. By requiring financial aid letters to provide monthly payment amounts and total payoff over a standard 10-year term, students and families can better grasp the true long-term cost of borrowing, not just the upfront loan amount.
Helps with financial planning and decision-making. Knowing the actual monthly payment and total repayment amount empowers students to make more informed choices about their education, compare financial aid offers more effectively, and avoid over-borrowing.
Aims to reduce loan default and misunderstanding. By including detailed repayment estimates, the bill addresses common confusion around how much loans will actually cost after graduation, potentially decreasing the risk of default and financial distress later on.
Promotes transparency and accountability for institutions. Colleges and vocational schools must present loan information in a clear, standardized format, making it harder for institutions to obscure or downplay the impact of student loans.
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Who cares
Headline styles
Show Loan Repayment in Aid Letters
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Referred to banks
- Delivered to assembly
- Passed senateVote 60–0
- Ordered to third reading cal.775
- Reported and committed to rules
- Referred to banks
- Returned to senate
- Died in assembly
- Referred to banks
- Delivered to assembly
- Passed senateVote 62–0
- Advanced to third reading
Show 3 earlier actions
- 2nd report cal.
- 1st report cal.650
- Referred to banks
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Show Loan Repayment On Aid Letters
In Assembly Committee · Banks · Sponsor Kenneth Zebrowski
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
4652
2019-2020 Regular Sessions
IN SENATE
March 19, 2019
Introduced by Sen. SANDERS -- read twice and ordered printed, and when printed to be committed to the Committee on Banks
AN ACT to amend the banking law, in relation to including information concerning repayment of outstanding loans in the standard financial aid award letter
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 9-w of the banking law, as amended by section 1 of part CC of chapter 54 of the laws of 2016, is amended to read as follows:
§ 9-w. Standard financial aid award letter. The superintendent [of financial services] in consultation with the president of the higher education services corporation shall develop a standard financial aid award letter which shall clearly delineate (a) the estimated cost of attendance, including but not limited to, the cost of tuition and fees, room and board, books, and transportation. Such standard letter shall provide the estimated cost of attendance for the current academic year as well as estimates for each academic year that the student would need to attend to earn a degree at such institution with a disclaimer that the cost of attendance for years other than the current academic year are estimates and may be subject to change, (b) all financial aid offered from the federal government, the state, and the institution with an explanation as to which components will require repayment, (c) any expected student and/or family contribution, (d) campus-specific graduation, median borrowing, and loan default rates, [and] (e) the estimated loan repayment impact using a standard ten year repayment term and assumed interest rate on the current amount of outstanding loans including total expected payoff amount inclusive of principal and interest, and expected monthly payment, and (f) any other information as determined by the superintendent in consultation with the president. Such standard letter shall include a glossary of standard terms and defi-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01463-01-9
S. 4652 2
nitions used on such standard letter. The superintendent shall publish and make available such standard letter by December thirty-first, two thousand fifteen and thereafter. Each college, vocational institution, and any other institution that offers an approved program as defined in section six hundred one of the education law shall utilize the standard letter issued by the department of financial services in responding to all undergraduate financial aid applicants for the two thousand sixteen--two thousand seventeen academic year and thereafter. The superintendent shall promulgate regulations implementing this section.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the banking law, in relation to including information concerning repayment of outstanding loans in the standard financial aid award letter
Purpose or general idea of the bill
This bill will require standard financial aid award letters to include the estimated cost of repayment of all outstanding loans including expected monthly payments.
Summary of provisions
Section one of the bill amends section 9-W of the banking law as it relates to including additional information in the standard financial aid award letter. The standard financial aid award letter will include the estimated loan repayment for the student's outstanding loans using a standard ten year repayment term.
Section two of the bill relates to the effective date.
Justification
Debt from student loans has continued to grow over the last two decades with an estimated $1.3 trillion in outstanding debt. The enhancements to annual financial aid award letter will provide students with detailed information on their repayment including the estimated monthly payment amount. The goal is to better educate students so they are prepared for the debt burden after they graduate. A similar program was started in Indiana University and resulted in a decrease in student borrowing of 16% in the first two years of implementation. This additional informa- tion will help students make informed decisions on their borrowing behavior by estimating their repayment options.
Legislative history
A8450 of 2017-18
Fiscal implications to state and local governments
None.
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.