Short title; findings

(a)

Short title

This Act may be cited as the

Christopher Bryski Student Loan Protection Act

Christopher’s Law

. (b)

Findings

The Congress finds the following: (1)There is no requirement for Federal or private educational lenders to provide information with respect to creating a durable power of attorney for financial decisionmaking in accordance with State law to be used in the event of the death, incapacitation, or disability of the borrower or any cosigner. (2)No requirement exists for private educational lenders’ master promissory notes to include a clear and conspicuous description of the responsibilities of a borrower and cosigner in the event the borrower or cosigner becomes disabled, incapacitated, or dies. (3)An estimated 1,700,000 people sustain a traumatic brain injury each year, with older adolescents aged 15 to 19 years old more likely to sustain a traumatic brain injury than other age groups. (4)It has been estimated that the annual incidence of spinal cord injury, not including those who die at the scene of an accident, is approximately 40 cases per 1,000,000 people in the United States or approximately 12,000 new cases each year. These injuries can lead to permanent disability or loss of movement and can prohibit the victim from engaging in any substantial gainful activity. (5)In the 2007–2008 academic year, 13 percent of students attending a 4-year public institution of higher education, and 26.2 percent of students attending a 4-year private institution of higher education, borrowed monies from private educational lenders. (6)According to Sallie Mae, in 2009, the percentage of cosigned private education loans increased from 66 percent to 84 percent of all private education loans.

Additional student loan protections

(a)

In general

(1)

Amendment

Section 140 of the Truth in Lending Act (15 U.S.C. 1650) is amended by adding at the end the following:

(g)

Additional protections relating to death or disability of borrower or cosigner of a private education loan

(1)

Obligation to provide information about power of attorney

In conjunction with— (A)any student loan counseling provided by a covered educational institution to any new borrower and any cosigner at the time of any loan application, loan origination, or loan consolidation, or at the time the cosigner assumes responsibility for repayment, the institution shall provide information with respect to creating a durable power of attorney for financial decisionmaking, in accordance with the State law where the institution is located; and (B)any application for a private education loan, the private educational lender involved in such loan shall provide information to the borrower, and any cosigner, concerning the creation of a durable power of attorney for financial decisionmaking, in accordance with the State law where the institution to be attended by the borrower is located, with respect to such loan. (2)

Clear and conspicuous description of cosigner’s obligation

In the case of any private educational lender who extends a private education loan for which any cosigner is jointly liable, the lender shall clearly and conspicuously describe, in writing, the cosigner’s obligations with respect to the loan, including the effect the death, disability, or inability to engage in any substantial gainful activity of the borrower or any cosigner would have on any such obligation, in language that the Board determines would give a reasonable person a reasonable understanding of the obligation being assumed by becoming a cosigner for the loan. (3)

Model forms

The Board shall publish model forms under section 105 for— (A)the information required under paragraph (1) with respect to a durable power of attorney for financial decisionmaking for each State (and such model forms under this subparagraph shall be uniform for all States to the greatest extent possible); and (B)describing a cosigner’s obligation for purposes of paragraph (2). (4)

Definition of death, disability, or inability to engage in any substantial gainful activity

For the purposes of this subsection with respect to a borrower or cosigner, the term death, disability, or inability to engage in any substantial gainful activity— (A)means any condition described in section 437(a) of the Higher Education Act of 1965 (20 U.S.C. 1087(a)); and (B)shall be interpreted by the Board in such a manner as to conform with the regulations prescribed by the Secretary of Education under section 437(a) of such Act (20 U.S.C. 1087(a)) to the fullest extent practicable, including safeguards to prevent fraud and abuse.

(2)

Conforming amendment

Effective on the designated transfer date established under section 1062 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5582), section 140(g) of the Truth in Lending Act (15 U.S.C. 1650(g)), as added by this subsection, is amended by striking Board each place the term occurs and inserting Bureau. (b)

Definitions

Subsection (a) of section 140 of the Truth in Lending Act (15 U.S.C. 1650(a)) is amended— (1)by redesignating paragraphs (1) and (2) through (8) as paragraphs (2) and (4) through (10), respectively; (2)by inserting before paragraph (2) the following:

(1)the term cosigner— (A)means any individual who is liable for the obligation of another without compensation, regardless of how designated in the contract or instrument; (B)includes any person whose signature is requested as condition to grant credit or to forbear on collection; and (C)does not include a spouse of an individual referred to in subparagraph (A) whose signature is needed to perfect the security interest in the loan;

; and

(3)by inserting after paragraph (2) (as redesignated by paragraph (1)) the following:

(3)(A)the term durable power of attorney has the meaning given to such term under State law; or (B)in the case of a State that does not have a law described in subparagraph (A), the terms durable and power of attorney have the meanings given to such terms in section 102 of the Uniform Power of Attorney Act, as approved by the National Conference of Commissioners on State Laws in 2006;

Federal student loans

Section 485(l)(2) of the Higher Education Act of 1965 (20 U.S.C. 1092(l)(2)) is amended by adding at the end the following:

(L)Information on the conditions required to discharge the loan due to the death, disability, or inability to engage in any substantial gainful activity of the borrower in accordance with section 437(a), and an explanation that, in the case of a private education loan made through a private educational lender (as such terms are defined in section 140 of the Truth in Lending Act (20 U.S.C. 1019)), the borrower, the borrower’s estate, and any cosigner of such a private education loan may be obligated to repay the full amount of the loan, regardless of the death or disability of the borrower or any other condition described in section 437(a). (M)(i)The model form with respect to durable power of attorney for financial decisionmaking, as published by the Board of Governors of the Federal Reserve System or the Bureau of Consumer Financial Protection (as the case may be) in accordance with section 140(g)(3)(A) of the Truth in Lending Act (15 U.S.C. 1650(g)(3)(A)), for the State in which the institution is located. (ii)In the case of a borrower who is not a resident of the State in which the institution is located, information on how to access such model form for the State in which the borrower resides.