BILL NUMBER: S1137A
SPONSOR: SANDERS
 
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:
2023 referred to assembly banks PASSED SENATE
2022 referred to assembly banks 2021 PASSED SENATE
2021 referred to assembly banks 2020 PASSED SENATE
2020 referred to assembly banks 2019 PASSED SENATE
2019 referred to assembly banks A8450 of 2017-18
 
FISCAL IMPLICATIONS TO STATE AND LOCAL GOVERNMENTS:
None.
 
EFFECTIVE DATE:
This act shall take effect immediately.

Statutes affected:
S1137: 9-w banking law
S1137A: 9-w banking law