Section 1 Short title
This Act may be cited as the “Student Borrower Higher Education Lending Protection Act of 2016” or the “Student Borrower HELP Act of 2016”.
Student Borrower Higher Education Lending Protection Act of 2016
A BILL
To amend the Truth in Lending Act to provide private education loan forgiveness for certain borrowers, to require disclosures related to private education loan default rates, and for other purposes.
Sec. 2 Private education loan forgiveness for deceased or disabled students
Amendments to TILA— Section 140 of the Truth in Lending Act (15 U.S.C. 1650) is amended by adding at the end the following new subsection:
“(g) Deferment or discharge of private education loan
“(1) Temporary Disability—A student borrower of a private education loan shall not be obligated to make payments on the loan, and interest shall not accrue on the loan, during the period in which the student borrower is determined to be under a disability (as defined in section 216(i) or 223(d) of the Social Security Act (42 U.S.C. 416(i))).
“(2) Death or total and permanent disability—If a student borrower of a private education loan dies or becomes totally or permanently disabled (as determined by the Secretary of Education in accordance with section 437(a)(1) of the Higher Education Act of 1965 (20 U.S.C. 1087(a)(1))), any outstanding balance on the loan shall be deemed to be discharged, and the student borrower, any cosignor on the loan, or the estate of either the student borrower or the cosignor shall not be obligated to make any additional payments on the loan.”
by striking the period at the end and inserting “, or”,
by striking “if such discharge was pursuant to a provision” and inserting the following:
“(A) a provision”
by adding at the end the following:
“(B) section 140(g)(2) of the Truth in Lending Act.”
Sec. 3 Required disclosures of default rates for private education loans
Section 128(e) of the Truth in Lending Act (15 U.S.C. 1638(e)) is amended—
in paragraph (1)—
in subparagraph (Q), by striking “and” at the end;
by redesignating subparagraph (R) as subparagraph (S); and
by inserting after subparagraph (Q) the following new subparagraph:
“(R) the number of private education loans offered by the private educational lender and the number and rate of default on such loans made by the lender; and”
in paragraph (2)—
in subparagraph (O), by striking “and” at the end;
by redesignating subparagraph (P) as subparagraph (Q); and
by inserting after subparagraph (O) the following new subparagraph:
“(P) the number of private education loans offered by the private educational lender and the number and rate of default on such loans made by the lender; and”
in paragraph (4), by striking “(M) through (P)” and inserting “(M) through (Q)”.
Sec. 4 Effective date; applicability
This Act and the amendments made by this Act—
shall take effect on the date that is 1 year after the date of the enactment of this Act; and
shall only apply to private education loans (as defined in section 140(a) of the Truth in Lending Act (15 U.S.C. 1650(a))) entered into on or after the effective date described in paragraph (1).