Bereaved Borrowers' Bill of Rights Act of 2014

Summary: Bereaved Borrowers' Bill of Rights Act of 2014 - Amends the Truth in Lending Act to require a private educational lender to include in a private education loan for which the cosigner is jointly liable a process for releasing the cosigner from obligations on such loan.  Requires a lender who receives notification of the death or bankruptcy of a cosigner who is jointly liable for the loan to notify the borrower about the borrower's rights under the loan agreement regarding: (1) release of the cosigner, and (2) identification of a new cosigner or refinancing of the loan.   Amends the Fair Credit Reporting Act to prohibit: (1) consumer reporting agencies from containing in any consumer report default on a private education loan that results from accelerated repayment terms of the loan after the death or bankruptcy of a jointly liable cosigner, and (2) the lender or servicer of a private educational loan from furnishing loan information to a consumer reporting agency if the consumer defaulted on the loan due to accelerated repayment terms after the death or bankruptcy of such a cosigner.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Bereaved Borrowers' Bill of Rights 
Act of 2014''.

SEC. 2. REQUIREMENTS FOR PRIVATE EDUCATIONAL LENDERS.

    Section 140 of such Act is further amended by adding at the end the 
following new subsection:
    ``(g) Requirements Regarding Cosigners for a Private Education 
Loan.--
            ``(1) Cosigner release requirements.--If a private 
        education loan has a cosigner who is jointly liable for such 
        loan, a private educational lender shall include a process for 
        releasing the cosigner from any obligations on the loan and in 
        such process the lender--
                    ``(A) shall make the criteria for obtaining the 
                release clear, transparent, and easily accessible via 
                the website of the private educational lender;
                    ``(B) shall notify the borrower if the borrower is 
                eligible to release a cosigner;
                    ``(C) shall, if denying a request to release a 
                cosigner, provide an explanation for the denial and 
                offer the borrower an opportunity to correct the 
                request; and
                    ``(D) may not change the terms of the release to 
                impose additional duties on the borrower or cosigner 
                over the duration of the private education loan.
            ``(2) Additional requirements.--Notwithstanding any 
        provision in a private education loan agreement that contains a 
        process for releasing a cosigner from obligations on the loan, 
        a private educational lender shall, upon receiving notification 
        of the death or bankruptcy of a cosigner--
                    ``(A) notify the borrower about the borrower's 
                rights under the private education loan agreement 
                regarding the release of the cosigner; and
                    ``(B) if the borrower continues to make on-time 
                payments (in the amount determined prior to the death 
                or bankruptcy of the cosigner) on the private education 
                loan, provide a period of time of not less than 90 days 
                for the borrower to follow the process for release of 
                the cosigner before deeming the borrower to be in 
                default, changing the terms of the loan, accelerating 
                the repayment terms of the loan, or notifying consumer 
                reporting agencies (as defined in section 603(f)) of a 
                change in the status of the loan.
            ``(3) Requirements in case of death or bankruptcy of a 
        cosigner.--Notwithstanding any provision in a private education 
        loan agreement, a private educational lender shall, upon 
        receiving notification of the death or bankruptcy of a cosigner 
        who is jointly liable for the private education loan--
                    ``(A) notify the borrower about the borrower's 
                rights under the private education loan agreement 
                regarding identifying a new cosigner or refinancing the 
                loan; and
                    ``(B) if the borrower continues to make on-time 
                payments (in the amount determined prior to the death 
                or bankruptcy of the cosigner) on the private education 
                loan, provide a period of time of not less than 90 days 
                for a borrower to identify a new cosigner or refinance 
                the loan before deeming the borrower to be in default, 
                changing the terms of the loan, accelerating the 
                repayment terms of the loan, or notifying consumer 
                reporting agencies (as defined in section 603(f)) of a 
                change in the status of the loan.''.

SEC. 3. PROHIBITIONS FOR CONSUMER REPORTING AGENCIES AND FURNISHERS OF 
              INFORMATION TO CONSUMER REPORTING AGENCIES RELATED TO 
              PRIVATE EDUCATION LOANS.

    (a) Prohibition for Consumer Reporting Agencies.--Subsection (a) of 
section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c(a)) is 
amended by adding at the end the following new paragraph:
            ``(7) Default on a private education loan (as defined in 
        section 140(a)) resulting from accelerated repayment terms of 
        the loan after the death or bankruptcy of a cosigner who is 
        jointly liable for the loan.''.
    (b) Prohibition for Furnishers of Information to Consumer Reporting 
Agencies.--Paragraph (1) of section 623(a) of such Act is amended by 
adding the following new subparagraph:
                    ``(E) Reporting information on private education 
                loans.--A private educational lender (as defined in 
                section 140(a)) or the servicer of a private education 
                loan (as defined in such section) shall not furnish any 
                information relating to the loan to any consumer 
                reporting agency if the consumer defaulted on the loan 
                due to accelerated repayment terms of the loan after 
                the death or bankruptcy of a cosigner who is jointly 
                liable for the loan.''.