764 
has the meaning given the term in section 
9101 of the Elementary and Secondary 
Education Act of 1965 (20 U.S.C. 7801).’’. 
SEC. 962. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated to the Sec-
retary of Commerce to carry out section 5(c) of the Steven-
son-Wydler Technology Innovation Act of 1980— 
(1) $250,000,000 for fiscal year 2008; and 
(2) such sums as may be necessary for each of 
the fiscal years 2009 through 2012. 
TITLE 
X—PRIVATE 
STUDENT 
LOAN 
TRANSPARENCY 
AND 
IMPROVEMENT 
SEC. 1001. SHORT TITLE. 
This title may be cited as the ‘‘Private Student Loan 
Transparency and Improvement Act of 2007’’. 
SEC. 1002. DEFINITIONS. 
As used in this title— 
(1) the term ‘‘Board’’ means the Board of Gov-
ernors of the Federal Reserve System; 
(2) the term ‘‘covered educational institution’’— 
(A) means any educational institution that 
offers a postsecondary educational degree, certifi-
cate, or program of study (including any institu-
tion of higher education); and 
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(B) includes an agent or employee of the 
educational institution; 
(3) the terms ‘‘Federal banking agencies’’ and 
‘‘appropriate Federal banking agency’’ have the same 
meanings as in section 3 of the Federal Deposit In-
surance Act (12 U.S.C. 1813); 
(4) the term ‘‘institution of higher education’’ 
has the same meaning as in section 102 of the Higher 
Education Act of 1965 (20 U.S.C. 1002); 
(5) the term ‘‘postsecondary educational ex-
penses’’ means any of the expenses that are included 
as part of the cost of attendance of a student, as de-
fined under section 472 of the Higher Education Act 
of 1965 (20 U.S.C. 1087ll); 
(6) the term ‘‘private educational lender’’ means 
any creditor (as defined in section 103 of the Truth 
in Lending Act) which solicits, makes, or extends pri-
vate educational loans; and 
(7) the term ‘‘private educational loan’’— 
(A) means a loan provided by a private 
educational lender that— 
(i) is not made, insured, or guaranteed 
under part B of title IV of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1070 et seq.); 
and 
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(ii) is issued by a private educational 
lender expressly for postsecondary edu-
cational expenses to a student, or the parent 
of the student, regardless of whether the loan 
involves enrollment certification by the edu-
cational institution that the student at-
tends, or whether the loan is provided 
through the educational institution that the 
subject student attends or directly to the 
borrower from the lender; and 
(B) does not include an extension of credit 
under an open end consumer credit plan, a resi-
dential mortgage transaction (as those terms are 
defined in section 103 of the Truth in Lending 
Act), or any other loan that is secured by real 
property or a dwelling. 
SEC. 1003. REGULATIONS. 
The Board shall issue final regulations to implement 
this title and the amendments made by this title not later 
than 180 days after the date of enactment of this title. 
SEC. 1004. EFFECTIVE DATES. 
This title and the amendments made by this title shall 
become effective 180 days after the date on which regula-
tions to carry out this title and the amendments made by 
this title are issued in final form. 
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Subtitle A—Preventing Unfair and 
Deceptive Private Educational 
Lending Practices and Elimi-
nating Conflicts of Interest 
SEC. 1011. AMENDMENT TO THE TRUTH IN LENDING ACT. 
(a) IN GENERAL.—Chapter 2 of the Truth in Lending 
Act (15 U.S.C. 1631 et seq.) is amended by adding at the 
end the following new section: 
‘‘§ 140. Preventing unfair and deceptive private edu-
cational lending practices and elimi-
nating conflicts of interest 
‘‘(a) DEFINITIONS.—For purposes of this section, the 
following definitions shall apply: 
‘‘(1) COVERED EDUCATIONAL INSTITUTION.—The 
term ‘covered educational institution’— 
‘‘(A) means any educational institution 
that offers a postsecondary educational degree, 
certificate, or program of study (including any 
institution of higher education); and 
‘‘(B) includes an agent or employee of the 
educational institution. 
‘‘(2) GIFT.—The term ‘gift’— 
‘‘(A) means any gratuity, favor, discount, 
entertainment, hospitality, loan, or other item 
having a monetary value of more than a de 
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minimis amount, including a gift of services, 
transportation, lodging, or meals, whether pro-
vided in kind, by purchase of a ticket, payment 
in advance, or reimbursement after the expense 
has been incurred; 
‘‘(B) does not include— 
‘‘(i) standard informational material 
related to a loan or financial literacy (such 
as a brochure); 
‘‘(ii) food, refreshments, training, or 
informational material furnished to an em-
ployee or agent of a covered educational in-
stitution, as an integral part of a training 
session that is designed to improve the serv-
ice of the private educational lender to the 
covered educational institution, if such 
training contributes to the professional de-
velopment of the employee or agent of the 
covered educational institution; or 
‘‘(iii) favorable terms, conditions, and 
borrower benefits on an educational loan 
provided to a student employed by the cov-
ered educational institution if such terms, 
conditions, or benefits are comparable to 
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those provided to all students of the institu-
tion; and 
‘‘(C) includes a gift to a family member of 
an officer, employee, or agent of a covered insti-
tution, or a gift to any other individual based on 
that individual’s relationship with the officer, 
employee, or agent, if— 
‘‘(i) the gift is given with the knowl-
edge and acquiescence of the officer, em-
ployee, or agent; and 
‘‘(ii) the officer, employee, or agent has 
reason to believe the gift was given because 
of the official position of the officer, em-
ployee, or agent. 
‘‘(3) INSTITUTION OF HIGHER EDUCATION.—the 
term ‘institution of higher education’ has the same 
meaning as in section 102 of the Higher Education 
Act of 1965 (20 U.S.C. 1002). 
‘‘(4) POSTSECONDARY EDUCATIONAL EXPENSE.— 
The term ‘postsecondary educational expenses’ means 
any of the expenses that are included as part of the 
cost of attendance of a student, as defined under sec-
tion 472 of the Higher Education Act of 1965 (20 
U.S.C. 1087ll). 
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‘‘(5) PRIVATE EDUCATIONAL LENDER.—The term 
‘private educational lender’ means a creditor which 
solicits, makes, or extends private educational loans. 
‘‘(6) PRIVATE
EDUCATIONAL
LOAN.—The term 
‘private educational loan’— 
‘‘(A) means a loan provided by a private 
educational lender that— 
‘‘(i) is not made, insured, or guaran-
teed under part B of title IV of the Higher 
Education Act of 1965 (20 U.S.C. 1070 et 
seq.); and 
‘‘(ii) is issued by a private educational 
lender expressly for postsecondary edu-
cational expenses to a student, or the parent 
of the student, regardless of whether the loan 
involves enrollment certification by the edu-
cational institution that the student at-
tends, or whether the loan is provided 
through the educational institution that the 
subject student attends or directly to the 
borrower from the lender; and 
‘‘(B) does not include an extension of credit 
under an open end consumer credit plan, a resi-
dential mortgage transaction, or any other loan 
that is secured by real property or a dwelling. 
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‘‘(7) REVENUE
SHARING.—the term ‘revenue 
sharing’ means an arrangement between a covered 
educational institution and a private educational 
lender under which— 
‘‘(A) a private educational lender provides 
or issues private educational loans to students 
attending the covered educational institution or 
to the parents of such students; 
‘‘(B) the covered educational institution rec-
ommends to students or others the private edu-
cational lender or the private educational loans 
of the private educational lender; and 
‘‘(C) the private educational lender pays a 
fee or provides other material benefits, including 
profit or revenue sharing, to the covered edu-
cational institution or to the officers, employees, 
or agents of the covered educational institution 
in connection with the private educational loans 
provided to students attending the covered edu-
cational institution or a borrower acting on be-
half of a student. 
‘‘(b) PROHIBITION ON CERTAIN GIFTS AND ARRANGE-
MENTS.—A private educational lender, including any offi-
cer or employee thereof, may not, directly or indirectly— 
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‘‘(1) offer or provide any gift to a covered edu-
cational institution or a covered educational institu-
tion employee, nor may such covered educational in-
stitution, officer, or employee receive any such gift, in 
exchange for any advantage or consideration provided 
to such private educational lender related to its pri-
vate educational loan activities; or 
‘‘(2) engage in revenue sharing with a covered 
educational institution. 
‘‘(c) PROHIBITION ON CO-BRANDING.—A private edu-
cational lender may not use the name, emblem, mascot, or 
logo of the covered educational institution, or other words, 
pictures, or symbols readily identified with the covered edu-
cational institution, in the marketing of private edu-
cational loans in any way that implies that the covered 
educational institution endorses the private educational 
loans offered by the lender. 
‘‘(d) BAN ON PARTICIPATION ON ADVISORY COUN-
CILS.— 
‘‘(1) IN
GENERAL.—An officer, employee, or 
agent who is employed in the financial aid office of 
a covered institution, or who otherwise has respon-
sibilities with respect to private educational loans, 
shall not serve on or otherwise participate with advi-
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sory councils of private educational lenders or affili-
ates of such lenders. 
‘‘(2) RULES OF CONSTRUCTION.—No provision of 
this subsection shall be construed as— 
‘‘(A) prohibiting private educational lenders 
from seeking advice from covered institutions or 
groups of covered institutions (including through 
telephonic or electronic means, or a meeting) in 
order to improve products and services for bor-
rowers, to the extent that no gifts or compensa-
tion (including for transportation, lodging, or 
related expenses) are provided by private edu-
cational lenders in connection with seeking this 
advice from such institutions; or 
‘‘(B) prohibiting an employee, officer, or 
agent of a covered institution from serving on 
the board of directors of a private educational 
lender, if required by State law. 
‘‘(e) PROHIBITION ON PREPAYMENT OR REPAYMENT 
FEES OR PENALTY.—It shall be unlawful for any private 
educational lender to impose a fee or penalty on a borrower, 
directly or indirectly, for early repayment or prepayment, 
of any private educational loan.’’. 
(b) CLERICAL AMENDMENT.—The table of sections for 
chapter 2 of the Truth in Lending Act is amended by insert-
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ing after the item relating to section 139 the following new 
item: 
‘‘140. Preventing unfair and deceptive private educational lending practices and 
eliminating conflicts of interest.’’. 
SEC. 1012. CIVIL LIABILITY. 
Section 130 of the Truth in Lending Act (15 U.S.C. 
1640) is amended— 
(1) in subsection (a)— 
(A) in paragraph (3), by inserting ‘‘or sec-
tion 128(e)(8)’’ after ‘‘section 125’’; and 
(B) in the fourth sentence of the undesig-
nated matter at the end— 
(i) by striking ‘‘125 or’’ and inserting 
‘‘125,’’; and 
(ii) by inserting ‘‘or of section 128(e),’’ 
before ‘‘or for failing’’; and 
(2) in subsection (e), by inserting before the first 
period, the following: ‘‘or, in the case of a violation 
involving a private educational loan, 1 year from the 
date on which the first regular payment of principal 
is due under the loan’’. 
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Subtitle B—Improved Disclosures 
for Private Educational Loans 
SEC. 1021. PRIVATE EDUCATIONAL LOAN DISCLOSURES 
AND LIMITATIONS. 
Section 128 of the Truth in Lending Act (15 U.S.C. 
1638) is amended by adding at the end the following new 
subsection: 
‘‘(e) TERMS AND DISCLOSURE WITH RESPECT TO PRI-
VATE EDUCATIONAL LOANS.— 
‘‘(1) DISCLOSURES REQUIRED IN PRIVATE EDU-
CATIONAL LOAN APPLICATIONS AND SOLICITATIONS.— 
In any application for a private educational loan, or 
a solicitation for a private educational loan without 
requiring an application, the creditor shall disclose to 
the borrower, clearly and conspicuously— 
‘‘(A) the potential range of rates of interest 
applicable to the private educational loan; 
‘‘(B) whether the rate of interest applicable 
to the private educational loan is fixed or vari-
able; 
‘‘(C) limitations on interest rate adjust-
ments, both in terms of frequency and amount, 
or the lack thereof; 
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‘‘(D) requirements for a co-borrower, in-
cluding any changes in the applicable interest 
rates without a co-borrower; 
‘‘(E) potential finance charges, late fees, 
penalties, and adjustments to principal, based on 
defaults or late payments of the borrower; 
‘‘(F) fees or range of fees applicable to the 
private educational loan; 
‘‘(G) the term of the private educational 
loan; 
‘‘(H) whether interest will accrue while the 
student to whom the private educational loan re-
lates is enrolled at an institution of higher edu-
cation; 
‘‘(I) payment deferral options, including 
whether the deferment would apply to interest or 
principal, or both; 
‘‘(J) general eligibility criteria for the pri-
vate educational loan; 
‘‘(K) an example of the total cost of the pri-
vate educational loan over the life of the loan— 
‘‘(i) which shall be calculated using the 
principal amount and the maximum rate of 
interest actually offered by the creditor; and 
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‘‘(ii) calculated both with and without 
capitalization of interest, if that is an op-
tion for postponing interest payments; 
‘‘(L) a statement that an institution of 
higher education may have school-specific edu-
cational loan benefits and terms not detailed on 
the disclosure form; 
‘‘(M) that the borrower may qualify for 
Federal financial assistance through a program 
under title IV of the Higher Education Act of 
1965, in lieu of, or in addition to, a loan from 
a non-Federal source; 
‘‘(N) the interest rates available with respect 
to such Federal financial assistance through a 
program under title IV of the Higher Education 
Act of 1965; 
‘‘(O) that the consumer may obtain addi-
tional information concerning such Federal fi-
nancial assistance from their institution of high-
er education or at the website of the Department 
of Education; 
‘‘(P) that, as provided in paragraph (6)— 
‘‘(i) the borrower shall have up to 30 
calendar days following the date on which 
the application for the private educational 
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loan is approved and the borrower receives 
the disclosure documents required under this 
subsection for the loan to accept the terms 
of the private educational loan and consum-
mate the transaction; and 
‘‘(ii) except for changes based on ad-
justments to the index used for a loan, the 
rates and terms of the loan may not be 
changed by the creditor during that 30-day 
period; and 
‘‘(Q) such other information as the Board 
shall prescribe, by rule, as necessary or appro-
priate for consumers to make informed bor-
rowing decisions. 
‘‘(2) 
WRITTEN
ACKNOWLEDGMENT
OF
RE-
CEIPT.—In each case in which a disclosure is pro-
vided pursuant to paragraph (1) and an application 
initiated, a creditor shall obtain a written acknowl-
edgment from the consumer that the consumer has 
read and understood the disclosure. 
‘‘(3) DISCLOSURES AT THE TIME OF PRIVATE 
EDUCATIONAL LOAN APPROVAL.—Subject to the rules 
of the Board, contemporaneously with the approval of 
a private educational loan application, and before the 
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loan transaction is consummated, the creditor shall 
disclose to the borrower, clearly and conspicuously— 
‘‘(A) the applicable rate of interest in effect 
on the date of approval; 
‘‘(B) whether the rate of interest applicable 
to the private educational loan is fixed or vari-
able; 
‘‘(C) limitations on interest rate adjust-
ments, both in terms of frequency and amount, 
or the lack thereof; 
‘‘(D) 
the 
initial 
approved 
principal 
amount; 
‘‘(E) applicable finance charges, late fees, 
penalties, and adjustments to principal, based 
upon borrower defaults or late payments; 
‘‘(F) the maximum term under the private 
educational loan program; 
‘‘(G) an estimate of the total amount for re-
payment, at both the interest rate in effect on the 
date of approval and at the maximum possible 
rate of interest actually offered by the creditor, 
to the extent that such maximum rate may be 
determined, or if not, a good faith estimate there-
of; 
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‘‘(H) any principal and interest payments 
required while the student to whom the private 
educational loan relates is enrolled at an institu-
tion of higher education and interest which will 
accrue during such enrollment; 
‘‘(I) payment deferral options, including 
whether the deferment would apply to interest or 
principal, or both; 
‘‘(J) whether monthly payments are grad-
uated; 
‘‘(K) that, as provided in paragraph (7)— 
‘‘(i) the borrower shall have up to 30 
calendar days following the date on which 
the application for the private educational 
loan is approved and the borrower receives 
the disclosure documents required under this 
subsection for the loan to accept the terms 
of the private educational loan and consum-
mate the transaction; and 
‘‘(ii) except for changes based on ad-
justments to the index used for a loan, the 
rates and terms of the loan may not be 
changed by the creditor during that 30-day 
period; 
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‘‘(L) that the borrower may qualify for Fed-
eral financial assistance through a program 
under title IV of the Higher Education Act of 
1965, in lieu of, or in addition to, a loan from 
a non-Federal source; 
‘‘(M) the interest rates available with re-
spect to such Federal financial assistance 
through a program under title IV of the Higher 
Education Act of 1965; 
‘‘(N) the maximum monthly payment, cal-
culated using the maximum rate of interest actu-
ally offered by the creditor, to the extent that 
such maximum rate may be determined, or if 
not, a good faith estimate thereof; and 
‘‘(O) such other information as the Board 
shall prescribe, by rule, as necessary or appro-
priate for consumers to make informed bor-
rowing decisions. 
‘‘(4) PROVISION
OF
INFORMATION.—Before a 
creditor may issue any funds with respect to an ex-
tension of credit described in paragraph (1) for an 
amount equal to more than $1,000, the creditor shall 
notify the relevant institution of higher education, in 
writing, of the proposed extension of credit and the 
amount thereof. 
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782 
‘‘(5) DISCLOSURES AT THE TIME OF PRIVATE 
EDUCATIONAL LOAN CONSUMMATION.—Subject to the 
regulations prescribed by the Board, contempora-
neously with the consummation of a private edu-
cational loan, the creditor shall make each of the dis-
closures described in subparagraphs (A) through (J) 
and (L) through (O) of paragraph (3) to the bor-
rower. 
‘‘(6) FORMAT OF DISCLOSURES.—Disclosures re-
quired under paragraphs (1), (3), and (5) shall ap-
pear in a clearly legible, uniform format, subject to 
section 122(c). 
‘‘(7) EFFECTIVE PERIOD OF APPROVED RATE OF 
INTEREST AND LOAN TERMS.— 
‘‘(A) IN GENERAL.—With respect to a pri-
vate educational loan, the borrower shall have 
the right to accept the terms of the loan and con-
summate the transaction at any time within 30 
calendar days following the date on which the 
application for the private educational loan is 
approved and the borrower receives the disclosure 
documents required under this subsection for the 
loan, and the rates and terms of the loan may 
not be changed by the creditor during that pe-
riod, subject to the rules of the Board. 
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‘‘(B) PROHIBITION
ON
CHANGES.—Except 
for changes based on adjustments to the index 
used for a loan, the rates and terms of the loan 
may not be changed by the creditor prior to the 
earlier of— 
‘‘(i) the date of acceptance of the terms 
of the loan and consummation of the trans-
action by the borrower, as described in sub-
paragraph (A); or 
‘‘(ii) the expiration of the 30-day pe-
riod referred to in subparagraph (A). 
‘‘(C) PROHIBITION ON DISBURSEMENT.—No 
funds may be disbursed with respect to a private 
educational loan until acceptance of the loan by 
the borrower under subparagraph (A) and the 
expiration of the 3-day period under paragraph 
(7). 
‘‘(8) RIGHT TO CANCEL.—With respect to a pri-
vate educational loan, the borrower may cancel the 
loan, without penalty to the borrower, at any time 
within 3 business days of the date on which the loan 
is consummated, subject to the rules of the Board. No 
funds may be transferred to the borrower during that 
3-day period. 
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784 
‘‘(9) DEFINITIONS.—For purposes of this sub-
section, the following definitions shall apply: 
‘‘(A) 
INSTITUTION
OF
HIGHER
EDU-
CATION.—The term ‘institution of higher edu-
cation’ has the same meaning as in section 102 
of the Higher Education Act of 1965 (20 U.S.C. 
1002). 
‘‘(B) PRIVATE EDUCATIONAL LENDER.—The 
term ‘private educational lender’ means any 
creditor engaged in the business of soliciting, 
making, or extending private educational loans. 
‘‘(C) PRIVATE
EDUCATIONAL
LOAN.—The 
term ‘private educational loan’— 
‘‘(i) means a loan provided by a pri-
vate educational lender that— 
‘‘(I) is not made, insured, or 
guaranteed under part B of title IV of 
the Higher Education Act of 1965 (20 
U.S.C. 1070 et seq.); and 
‘‘(II) is issued by a private edu-
cational lender expressly for postsec-
ondary educational expenses to a stu-
dent, or the parent of the student, re-
gardless of whether the loan involves 
enrollment certification by the edu-
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cational institution that the student 
attends, or whether the loan is pro-
vided through the educational institu-
tion that the subject student attends or 
directly to the borrower from the lend-
er; and 
‘‘(ii) does not include an extension of 
credit under an open end consumer credit 
plan, a reverse mortgage transaction, a resi-
dential mortgage transaction, or any other 
loan that is secured by real property or a 
dwelling.’’. 
SEC. 1022. APPLICATION OF TRUTH IN LENDING ACT TO 
ALL PRIVATE EDUCATIONAL LOANS. 
Section 104(3) of the Truth in Lending Act (15 U.S.C. 
1603(3)) is amended by inserting ‘‘and other than private 
educational loans (as that term is defined in section 
140(a))’’ after ‘‘consumer’’. 
Subtitle C—Financial Literacy 
SEC. 1031. COORDINATED EDUCATION EFFORTS. 
(a) IN GENERAL.—The Secretary of the Treasury (in 
this section referred to as the ‘‘Secretary’’), in coordination 
with the Secretary of Education, the Secretary of Agri-
culture (with respect to land grant covered educational in-
stitutions), and any other appropriate agency that is a 
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member of the Financial Literacy and Education Commis-
sion established under the Financial Literacy and Edu-
cation Improvement Act (20 U.S.C. 9701 et seq.), shall seek 
to enhance financial literacy among students at institutions 
of higher education through— 
(1) the development of initiatives, programs, and 
curricula that improve student awareness of the short- 
and long-term costs associated with educational loans 
and other debt assumed while in college, their repay-
ment obligations, and their rights as borrowers; and 
(2) assisting such students in navigating the fi-
nancial aid process. 
(b) DUTIES.—For purposes of this section, the Sec-
retary, working in conjunction with the Secretary of Edu-
cation, the Secretary of Agriculture, and the Financial Lit-
eracy and Education Commission, shall— 
(1) identify programs that promote or enhance 
financial literacy for college students, with specific 
emphasis on programs that impart the knowledge and 
ability for students to best navigate the financial aid 
process, including those that involve partnerships be-
tween nonprofit organizations, colleges and univer-
sities, State and local governments, and student orga-
nizations; 
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