Section 1 Short title
This Act may be cited as the “Transparency in Student Lending Act”.
Transparency in Student Lending Act
A BILL
To amend the Higher Education Act of 1965 to require the disclosure of the annual percentage rates applicable to Federal student loans.
Sec. 2 Required disclosures
Section 455(p) of the Higher Education Act of 1965 (20 U.S.C. 1087e(p)) is amended—
by striking “Each institution” and inserting the following:
“(1) In general—Each institution”
by adding at the end the following:
“(2) Disclosure of APR prior to disbursement—In addition to the disclosures required under paragraph (1), each institution and contractor described in such paragraph shall disclose to a borrower before disbursement of a loan made under this part, in writing and in a form the borrower may keep, the annual percentage rate applicable to the loan, taking into account—
“(A) the amount of the loan;
“(B) the stated interest rate of the loan;
“(C) the standard term for a loan of the same type;
“(D) any fees or additional costs associated with the loan; and
“(E) any capitalization of interest on the loan.”