S. 4097

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4097 Introduced in Senate (IS)]

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119th CONGRESS
2d Session
S. 4097

To establish that a State-based education loan program is excluded from 
certain requirements relating to a preferred lender arrangement.

_______________________________________________________________________

IN THE SENATE OF THE UNITED STATES

March 16, 2026

Ms. Murkowski (for herself, Mr. Reed, Mr. Cassidy, and Mrs. Shaheen) 
introduced the following bill; which was read twice and referred to the 
Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

A BILL

To establish that a State-based education loan program is excluded from 
certain requirements relating to a preferred lender arrangement.

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 ``State-Based Education Loan Awareness 
Act''.

SEC. 2. STATE-BASED EDUCATION LOAN PROGRAMS.

Section 151 of the Higher Education Act of 1965 (20 U.S.C. 1019) is 
amended--
(1) in paragraph (8)(B)--
(A) in clause (i), by striking ``or'' after the 
semicolon;
(B) in clause (ii), by striking the period at the 
end and inserting ``; or''; and
(C) by adding at the end the following:
``(iii) arrangements or agreements with 
respect to education loans made under a State-
based education loan program.''; and
(2) by adding at the end the following:
``(10) State-based education loan program.--The term 
`State-based education loan program' means an education loan 
program that--
``(A) is provided by a State agency, State 
authority, or nonprofit organization, separately or 
jointly;
``(B) makes loans that are not funded, insured, or 
guaranteed by the Federal Government;
``(C) is authorized, established, or chartered by 
State law, or otherwise approved by the State;
``(D) offers one or more loans for which the 
interest rate and fees, as calculated in accordance 
with sections 106 and 107 of the Truth in Lending Act 
(15 U.S.C. 1605; 1606), are at least as favorable as 
the interest rate and fees of the Direct PLUS loans 
authorized under part D of title IV at the time such 
loan is originated; and
``(E) is available only to a borrower who has been 
advised, such as in a financial aid offer, by an 
institution of higher education (as defined under 
section 102)--
``(i) that the borrower has the opportunity 
to exhaust eligibility for Federal education 
loans made under part D of title IV prior to 
accepting a private education loan; and
``(ii) of the interest rates, fees, and 
benefits of such Federal education loans, 
including income-driven repayment options, 
opportunities for loan forgiveness, forbearance 
or deferment options, interest subsidies, and 
tax benefits.''.
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