Failed Bill Sought Online Marketplace For Student Loans

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By Brandon B. QuinnA bill seeking to filter the murky waters of student loans has died in the State Legislature after the Assembly failed to bring the measure to a vote before the end of legislative session on Friday, June 21.

State Senator Kenneth LaValle introduced the Student Lending Transparency Program bill, which would require the Department of Financial Services to create an online marketplace to compare student loan rates and repayment plans. This digital tool could be accessed through every college website with a campus in the state.

Additionally, the bill would require colleges to arm all newly enrolled students with “clearly outlined and easy-to-understand information about the total cost of attendance,” including tuition, room and board, books, transportation and other expenses, according to Mr. LaValle. The bill mandates that together with the online marketplace and total cost of attendance, each college inform prospective students of what their approximate monthly bill would be upon graduation.

“The impetus for the bill is the high cost of student loans and the debt that students incur. What is critically important is the students should be able to shop,” said Mr. LaValle. “They should know who is offering the best deals so they can make an informed decision.”

Mr. LaValle, who chairs the Senate’s Higher Education Committee, has championed the issue of student loans for quite some time.

“Governor Cuomo and I, back when he was the attorney general, passed legislation dealing with transparency between colleges and banks that became federal law,” recounted Mr. LaValle. “What colleges were doing was leading students to certain lenders, because the lenders would in turn contribute to the scholarship funds or athletics for a school. They had preferred lenders. The law we passed banned those types of practices years ago, but the confusion of today makes the situation just as dire.”

To Mr. LaValle, the bill, which “seemed to have support in the Assembly but never picked up a sponsor, protects not just prospective students, but our nation’s economy as a whole.

“If you are paying off your student loans from your salary at your entry-level job, you’re not out there buying a house,” he said. “You’re not buying a car, you aren’t starting a family. It really has a profound effect on our economy.”

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