Sec. 4. Counseling for Parent PLUS borrowers
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Section 485 of the Higher Education Act of 1965 ( 20 U.S.C. 1092 ) is amended by adding at the end the following: The Secretary, prior to disbursement of a Federal Direct PLUS loan made on behalf of a dependent student, shall ensure that the borrower receives comprehensive information on the terms and conditions of the loan and the responsibilities the borrower has with respect to such loan. Such information— shall be provided through the use of interactive programs that use mechanisms to check the borrower’s understanding of the terms and conditions of the borrower’s loan, using simple and understandable language and clear formatting; and shall be provided— during a counseling session conducted in person; or online.
The information to be provided to the borrower under paragraph
(1)shall include the following: Information on how interest accrues and is capitalized during periods when the interest is not paid by the borrower. An explanation of when loan repayment begins, of the options available for a borrower who may need a deferment, and that interest accrues during a deferment. The repayment plans that are available to the borrower, including personalized information showing— estimates of the borrower’s anticipated monthly payments under each repayment plan that is available; and the difference in interest paid and total payments under each repayment plan. The obligation of the borrower to repay the full amount of the loan, regardless of whether the student on whose behalf the loan was made completes the program in which the student is enrolled. The likely consequences of default on the loan, including adverse credit reports, delinquent debt collection procedures under Federal law, and litigation. The name and contact information of the individual the borrower may contact if the borrower has any questions about the borrower’s rights and responsibilities or the terms and conditions of the loan. .
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Sec. 4
Counseling for Parent PLUS borrowers
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