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SPRINGFIELD – Senate Higher Education Committee Chair Scott Bennett (D-Champaign) moved a measure through committee Tuesday to help students make more informed choices about the loans they take out to pay for college, as well as establish new accountability standards for private loan companies.

“Student debt in Illinois has been climbing, and it’s becoming a major issue for recent graduates and their families,” Bennett said. “The student loan market can be confusing, so it’s important students and families know if they qualify for federal loans before taking on private loans.”
 
Bennett introduced the Know Before You Owe Private Education Loan Act, which requires private lenders to confirm with a potential borrower’s school that the student’s tuition, housing and other costs are not covered by other sources of financial aid. Additionally, the legislation requires colleges and universities to notify students about their federal loan eligibility before certifying private loans.

Bennett worked closely with the Illinois attorney general’s office and State Representative Katie Stuart (D-Edwardsville) to craft the legislation.

“Private student loans are more expensive and more difficult for borrowers to repay. As we have seen during the pandemic, the relief that comes with federal student loans is particularly critical during an economic downturn,” Illinois Attorney General Kwame Raoul said. “This legislation ensures that students and families are aware of the benefits of federal loans and whether they are eligible – before they take out private loans.”

“The Know Before You Owe initiative will ensure students and their families have clear information when weighing their loan options,” Bennett said. “Students and their families make a substantial investment in higher education. I’m pleased to see this legislation advance so Illinois students have more control over their financial futures.”

House Bill 2746 will now go before the full Senate for further consideration.

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