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Second Opinion

Learn about policy issues important to medical schools and teaching hospitals, with Executive Vice President Atul Grover, M.D., Ph.D.

Washington Highlights

House Reps Introduce Bill with TILA Amendment Following CFPB Report

August 3, 2012—Representatives Jared Polis (D-Colo.), Tim Bishop (D-N.Y.), and Allyson Schwartz (R-Pa.) Aug. 2 introduced the Know Before You Owe Act (H.R. 6273), a companion to the Senate measure that was introduced in March (S. 2280). The AAMC has endorsed both bills, which include a provision of the AAMC’s budget-neutral “Debt HELP” legislative proposal. 

The Know Before You Owe bills exclude the Title VII and Title VIII health professions student loans administered by the Health Resources and Services Administration (HRSA) from private student loan regulations under the Truth in Lending Act (TILA). Additionally, the bills require private lenders to have loans certified by institutions and obtain enrollment status, cost of attendance, and the student’s estimated federal financial assistance.

The Consumer Financial Protection Bureau (CFPB) July 19 released a report to Congress on private student loans that “describes the risky practices and debt that stemmed from the boom and bust of the private student loan market in the past ten years.”  The AAMC submitted a Jan. 17 comment letter in response to the bureau’s request for information recommending the exclusion of Title VII and Title VIII loans from TILA regulation, a position supported in the final report [see Washington Highlights, Jan. 20]. 

Similar to the Know Before You Owe bills, the CFPB report recommends excluding Titles VII and VIII loans from TILA regulations and requiring private student loans to be certified by the higher education institution.  Additionally, the report recommends allowing private student loans to be discharged in bankruptcy and setting up a database for private student loans similar to the National Student Loan Data System (NSLDS) for federal loans.

Secretary of Education Arne Duncan supported the CFPB recommendations in a section accompanying the report.


Matthew Shick, JD
Director, Gov't Relations & Regulatory Affairs
Telephone: 202-862-6116


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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806