The Federal Reserve Board has proposed amendments to Regulation Z (Truth in Lending) that would revise the disclosure requirements for private education loans.
The amendments implement provisions of the Higher Education Opportunity Act (HEOA). Under the amendments, creditors that extend private education loans would provide disclosures about loan terms and features on or with the loan application and would also have to disclose information about federal student loan programs that may offer less costly alternatives. Additional disclosures would have to be provided when the loan is approved and when the loan is consummated. The Board is also proposing model disclosure forms that creditors could use to comply with the new disclosure requirements. The new disclosure requirements would apply to loans made expressly for postsecondary educational expenses but would not apply where educational expenses are funded by credit card advances, or real-estate-secured loans.
See the press release for more details.
