Transparent Federal Student Loan Disclosure Requirements pushed by Future Caucus Member Rep. Jaime Herrera Beutler

HR2090, introduced by CFC member Rep. Jaime Herrera Beutler (WA-3) on March 19th 2021 would require lenders of federal loans to publish certain disclosures to the general public. The bill, which is active and has been referred to the House Committee on Education and Labor, aims to address the lack of transparency among lenders of federal student loans. The legislation would require lenders to disclose the principal amount, interest rate, and the number of required monthly payments on a loan prior to disbursement. Additionally, the bill would require lenders to provide an estimated balance owed by the borrower and an estimated aggregate amount the borrower will pay over time, and the Department of Education would be required to obtain feedback from individual borrowers and report on the usefulness and effectiveness of new disclosure requirements. 

With the introduction of HR2090, Rep. Herrera Beutler is leading bipartisan momentum, begun in the last Congress, around improving transparency for student borrowers.

Why this matters to young Americans and young legislators 

The issue of student loan debt is intimately familiar for too many young Americans. In 2020, total student loan debt reached $1.56 trillion. 44.7 million Americans hold student loan debt with an average student loan debt of $32,731 and a monthly payment of $393. For the graduating class of 2018, the average student loan debt owed is $29,200, which is a 2% increase from 2017. 

HR2090 is a bipartisan bill that aims to crack down on the predatory nature of student loan lending and address the growing national impact of federal student loan debt on young Americans across the country. The bill seeks to increase transparency from loan services, require honesty about repayment options, and obligate clear and easy-to-understand information about different types of student loans.

Legislative History 

In the 116th Congress, Rep. Herrera Beutler led the charge to address student loan disclosure requirements to ensure students and families receive all of the relevant information before taking out a federal student loan.

Prior to reintroduction in the 117th Congress, Rep. Herrera Beutler supported the Student Loan Disclosure Transparency Act of 2019, which ultimately received 44 co-sponsors, including CFC emeritus co-chair Rep. Haley Stevens (MI-11) and CFC members Reps. Darren Soto (FL-9), Ben McAdams (UT-4), and Henry Cuellar (TX-28). The bill did not leave the House Education and Labor Committee, but hopes for passage have been revived with renewed bipartisan support this session. 

To learn more about the specifics of this legislative effort, or to hear about MAP’s active legislation on Future of Work, please reach out to [email protected]  

Sources: Forbes, U.S. Department of Education