[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 2459 Introduced in Senate (IS)]

113th CONGRESS
  2d Session
                                S. 2459

  To revise counseling requirements for certain borrowers of student 
                     loans and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 10, 2014

 Mr. Grassley introduced the following bill; which was read twice and 
  referred to the Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
  To revise counseling requirements for certain borrowers of student 
                     loans and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Know Before You Owe Federal Student 
Loan Act of 2014''.

SEC. 2. PRE-LOAN COUNSELING AND CERTIFICATION OF LOAN AMOUNT.

    Section 485(l) of the Higher Education Act of 1965 (20 U.S.C. 
1092(l)) is amended--
            (1) in the subsection heading, by striking ``Entrance 
        Counseling'' and inserting ``Pre-Loan Counseling'';
            (2) in paragraph (1)--
                    (A) in subparagraph (A)--
                            (i) in the matter preceding clause (i), by 
                        striking ``a disbursement to a first-time 
                        borrower of a loan'' and inserting ``the first 
                        disbursement of each new loan (or the first 
                        disbursement in each award year if more than 
                        one new loan is obtained in the same award 
                        year)''; and
                    (B) in clause (ii)(I), by striking ``an entrance 
                counseling'' and inserting ``a counseling'';
            (3) in paragraph (2)--
                    (A) by striking clause (i) of subparagraph (G) and 
                inserting the following:
                            ``(i) an estimate of the borrower's 
                        projected loan debt-to-income ratio upon 
                        graduation, calculated using the best available 
                        data on starting wages for the borrower's 
                        program of study and the estimated total 
                        student loan debt, including Federal and 
                        private loan debt already incurred and the 
                        estimated future debt required to complete the 
                        program of study; and''; and
                    (B) by adding at the end the following:
                    ``(L) A statement that the borrower should borrow 
                the minimum amount necessary to cover expenses and that 
                the borrower does not have to accept the full amount of 
                loans for which the borrower is eligible.
                    ``(M) Information about the default risk of having 
                a projected loan debt-to-income ratio greater than 12 
                percent.
                    ``(N) Options for reducing borrowing through 
                scholarships, reduced expenses, work-study, or other 
                work opportunities.
                    ``(O) An explanation of the importance of 
                graduating on time to avoid additional borrowing, and 
                information on how adding an additional year of study 
                impacts total indebtedness.''; and
            (4) by adding at the end the following:
            ``(3) In addition to the other requirements of this 
        subsection, each eligible institution shall, prior to 
        certifying a Federal direct loan under part D for disbursement 
        to a student (other than a Federal Direct Consolidation Loan or 
        a Federal Direct PLUS loan made on behalf of a student), ensure 
        that the student manually enter, either in writing or through 
        electronic means, the exact dollar amount of Federal direct 
        loan funding under part D that such student desires to 
        borrow.''.

SEC. 3. CONFORMING AMENDMENTS.

    (a) Program Participation Agreements.--Section 487(e)(2)(B)(ii)(IV) 
of the Higher Education Act of 1965 (20 U.S.C. 1094(e)(2)(B)(ii)(IV)) 
is amended--
            (1) by striking ``Entrance and exit counseling'' and 
        inserting ``Pre-loan and exit counseling''; and
            (2) by striking ``entrance and exit counseling'' and 
        inserting ``pre-loan and exit counseling''.
    (b) Regulatory Relief and Improvement.--Section 487A of the Higher 
Education Act of 1965 (20 U.S.C. 1094a) is amended by striking 
``entrance and exit interviews'' and inserting ``pre-loan and exit 
interviews'' each place the term appears.
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