Establishes the “State-Based Education Loan Awareness Act.”
Amends the Higher Education Act of 1965 to exclude state-based education loan programs from certain requirements related to preferred lender arrangements.
Defines a “State-based education loan program” as one that:
Is provided by a State agency, authority, or nonprofit organization.
Offers loans not funded, insured, or guaranteed by the Federal Government.
Is authorized or approved by State law.
Provides loans with interest rates and fees at least as favorable as those of Direct PLUS loans at the time of origination.
Is available only to borrowers who have been advised to exhaust eligibility for Federal education loans under part D of title IV before accepting a private education loan.
Requires borrowers to be informed of the benefits of Federal education loans, including income-driven repayment options, loan forgiveness opportunities, forbearance or deferment options, interest subsidies, and tax benefits.
