S T A T E O F N E W Y O R K
________________________________________________________________________
4598
2013-2014 Regular Sessions
I N S E N A T E
April 12, 2013
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Introduced by Sen. LAVALLE -- read twice and ordered printed, and when
printed to be committed to the Committee on Banks
AN ACT to amend the financial services law, in relation to the truth in
student lending clearinghouse program; and to amend the financial
services law and the education law, in relation to the student lending
transparency program
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Paragraphs 6 and 7 of subsection (c) of section 301 of the
financial services law are amended and a new paragraph 8 is added to
read as follows:
(6) providing technical assistance to local governments and not-for-
profits in the development of consumer protection measures with respect
to financial products and services; [and]
(7) continuing and expanding the detection, investigation and
prevention of insurance fraud[.]; AND
(8) ESTABLISHING AND ADMINISTERING THE "STUDENT LENDING TRANSPARENCY
PROGRAM" PURSUANT TO ARTICLE SIX OF THIS CHAPTER.
S 2. The financial services law is amended by adding a new article 6
to read as follows:
ARTICLE 6
STUDENT LENDING TRANSPARENCY PROGRAM
SECTION 601. DEFINITIONS.
602. STUDENT LENDING TRANSPARENCY PROGRAM.
603. RULES AND REGULATIONS.
S 601. DEFINITIONS. THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEAN-
INGS WHEN USED IN THIS ARTICLE:
A. "PRIVATE STUDENT LOANS" SHALL MEAN A PRIVATE LOAN ISSUED BY A
PRIVATE LENDING INSTITUTION FOR THE PURPOSES OF PAYING FOR OR FINANCING
HIGHER EDUCATION EXPENSES.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09564-01-3
S. 4598 2
B. "PRIVATE LENDING INSTITUTIONS" OR "PRIVATE LENDERS" SHALL MEAN ANY
PRIVATE ENTITY THAT ITSELF OR THROUGH AN AFFILIATE MAKES AVAILABLE
STUDENT LOANS TO PAY FOR OR FINANCE HIGHER EDUCATION EXPENSES.
C. "STUDENT BORROWER" SHALL MEAN ANY INDIVIDUAL WHO BORROWS MONEY FROM
A PRIVATE LENDING INSTITUTION TO FINANCE HIGHER EDUCATION EXPENSES.
D. "HIGHER EDUCATION EXPENSES" SHALL INCLUDE THE FOLLOWING:
(I) TUITION AND FEES;
(II) BOOKS AND SUPPLIES; AND
(III) ROOM AND BOARD.
S 602. STUDENT LENDING TRANSPARENCY PROGRAM. 1. THE SUPERINTENDENT
SHALL ESTABLISH A PROGRAM TO COMPILE DATA RELATED TO PRIVATE STUDENT
LOANS FOR THE PURPOSE OF COMPARING PRIVATE LENDING INSTITUTION'S STUDENT
LOAN INTEREST RATES AND REPAYMENT PLANS, INCLUDING POLICIES RELATING TO
DEFERMENT AND FORBEARANCE, DEFAULT POLICIES AND PENALTIES, AND ANY OTHER
INFORMATION THAT THE SUPERINTENDENT DEEMS RELEVANT FOR THE PURPOSE OF
CREATING A LIST OF PRIVATE LENDERS WHO PROVIDE THE LOWEST RATES AND BEST
REPAYMENT OPTIONS ON STUDENT LOANS. SUCH LIST SHALL BE CREATED AND MAIN-
TAINED BY THE SUPERINTENDENT OR HIS DESIGNEE AND SHALL BE PLACED ON AN
EASILY ACCESSIBLE WEBSITE THAT SHALL BE MADE AVAILABLE TO BE LINKED TO
THE WEBSITE OF THE HIGHER EDUCATION SERVICES CORPORATION PURSUANT TO
SUBDIVISION THIRTEEN OF SECTION SIX HUNDRED FIFTY-FIVE OF THE EDUCATION
LAW AND TO COLLEGES AND UNIVERSITIES WEBSITES PURSUANT TO ARTICLE FOUR-
TEEN-B OF THE EDUCATION LAW.
2. SUCH WEBSITE SHALL BE UPDATED ON A MONTHLY BASIS TO ENSURE THAT THE
STUDENT LOAN INFORMATION IS CURRENT AND ACCURATE. THE SUPERINTENDENT OR
HIS OR HER DESIGNEE SHALL COMPILE A LIST OF THE TOP TEN BEST PRIVATE
LENDING INSTITUTIONS BASED UPON RATES AND POLICIES THAT ARE MOST FAVORA-
BLE TO THE STUDENT BORROWER. THE SUPERINTENDENT MAY ALSO CONSIDER THE
PRIVATE LENDING INSTITUTIONS POLICIES FOR ALLOWING A STUDENT BORROWER TO
BORROW MORE THAN TEN PERCENT OVER SUCH STUDENT BORROWER'S TOTAL COST OF
HIGHER EDUCATION EXPENSES WHEN DETERMINING IF A PRIVATE LENDING INSTITU-
TION SHOULD BE PLACED ON SUCH LIST. INFORMATION PERTAINING TO LENDING
INSTITUTIONS THAT DO NOT MAKE THE TOP TEN LIST SHALL ALSO BE POSTED ON
SUCH WEBSITE AND THOSE LENDING INSTITUTIONS THAT PROVIDE THE WORST RATES
AND STRICTEST REPAYMENT OPTIONS SHALL BE CLEARLY INDICATED.
S 603. RULES AND REGULATIONS. THE SUPERINTENDENT SHALL PROMULGATE ALL
RULES AND REGULATIONS NECESSARY FOR THE IMPLEMENTATION OF THIS ARTICLE.
S 3. Section 655 of the education law is amended by adding a new
subdivision 13 to read as follows:
13. TO CREATE A LINK ON THE CORPORATION'S WEBSITE TO THE DEPARTMENT OF
FINANCIAL SERVICES WEBSITE PURSUANT TO SUBDIVISION ONE OF SECTION SIX
HUNDRED TWO OF THE FINANCIAL SERVICES LAW.
S 4. The education law is amended by adding a new article 14-B to read
as follows:
ARTICLE 14-B
STUDENT LENDING TRANSPARENCY PROGRAM
SECTION 697. CREATION OF PROGRAM.
698. ACCESS TO INFORMATION.
699. LINKS TO DEPARTMENT OF FINANCIAL SERVICES.
S 697. CREATION OF PROGRAM. THE STUDENT LENDING TRANSPARENCY PROGRAM
IS HEREBY ESTABLISHED TO ENSURE THAT NEW YORK STATE COLLEGES PROVIDE THE
MOST ACCURATE AND TRANSPARENT INFORMATION WITH REGARD TO STUDENT LOANS.
S 698. ACCESS TO INFORMATION. NOTWITHSTANDING ANY OTHER LAW, RULE OR
REGULATION TO THE CONTRARY, NEW YORK STATE COLLEGES AS DEFINED IN
SECTION SIX HUNDRED ONE OF ARTICLE THIRTEEN OF THE EDUCATION LAW, SHALL
BE REQUIRED THROUGH THEIR FINANCIAL AID OFFICES TO PROVIDE TO PROSPEC-
S. 4598 3
TIVE OR NEWLY ACCEPTED STUDENTS AND PARENTS CLEARLY OUTLINED AND EASY TO
UNDERSTAND INFORMATION PERTAINING TO THE TOTAL COST OF ATTENDANCE AT
THEIR INSTITUTION, THE APPROXIMATE OR ACTUAL TOTAL AMOUNT OF FINANCIAL
AID THEY WOULD RECEIVE FROM SUCH INSTITUTION AND THE APPROXIMATE OR
ACTUAL TOTAL AMOUNT OF STUDENT LOAN DEBT THEY WOULD ACCUMULATE OVER THE
COURSE OF FOUR YEARS IF THEY ATTENDED SUCH COLLEGE. THE INFORMATION
PROVIDED MUST ALSO INCLUDE STUDENT LOAN RATES, INFORMATION ON REPAYMENT
PLANS AND DEFAULT RATES AND THE ACTUAL COST OF THE AVERAGE MONTHLY
PAYMENT THAT WOULD BE REQUIRED UPON GRADUATION WHEN SUCH LOANS WOULD
BECOME DUE.
S 699. LINKS TO DEPARTMENT OF FINANCIAL SERVICES. NEW YORK STATE
COLLEGES THAT MAINTAIN AN OFFICIAL COLLEGE WEBSITE SHALL ALSO BE
REQUIRED TO ADD A LINK ON EACH OF THEIR WEBSITES TO THE DEPARTMENT OF
FINANCIAL SERVICES WEBSITE ON STUDENT LENDING TRANSPARENCY CREATED
PURSUANT TO ARTICLE SIX OF THE FINANCIAL SERVICES LAW.
S 5. This act shall take effect on the one hundred eightieth day after
it shall have become a law.