Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 27, 2022 erstellt
Beschreibung:
In June 2021, Colorado Governor Jared Polis signed the Student Loan Equity Act into law, securing key new safeguards for private student loan borrowers in the Centennial State. Those protections involve a new and badly needed array of transparency measures for private student loan companies operating in Colorado, including requirements for annual public reporting on lending and borrower outcomes by firms operating in the “shadow” student debt market. Shadow student debt covers a wide range of private financing products that fall outside of the mainstream of private student loans, such as income share agreements and institutional financing owed directly to schools. But while shadow student debt can be extremely expensive and risky, it has historically evaded regulators’ successful scrutiny.Near the anniversary of the passage of the Student Loan Equity Act, it is clear that Colorado’s nation-leading work to shed light on shadow student debt and private student loans in general is paying off. In particular, Colorado Attorney General Phil Weiser recently published the first round of public disclosures that private student loan companies made under the state’s new law. The lenders’ reports offer a first-of-its-kind glimpse into the inner workings of some of the most notorious private student creditors and shadow student debt companies, including information on their portfolios and the contracts they offer students. What this glimpse revealed is not pretty. Instead, the disclosures that lenders submitted under Colorado’s new law show that borrowers are being driven into high-cost private financing for dubious programs, that lenders are sneaking aggressive and possibly illegal contract terms into consumers’ contracts, and that the student loan industry may not be complying fully with Colorado’s new borrower protections. These findings confirm the importance of the steps Colorado has taken—and they heighten the need for governments at all levels to follow suit