The Sunshine Act
Each year, 400,000 qualified students don't attend a four-year college because they can't afford it. Those who do go to college are borrowing more than ever to finance their education.
The current investigations of the student loan industry have made it clear that private lenders often don’t serve the best interest of students. Through a variety of corrupt practices, student loan companies gain an unfair advantage in marketing their loans to students and then charge interest rates of up to 19 percent.
To end these practices, Senators Dick Durbin and Kennedy have introduced the Student Loan Sunshine Act, which calls for full disclosure of special arrangements made between lenders and colleges and universities and prohibits lenders from offering lavish gifts to college officials in exchange for preferred status.
Students and their families struggle to pay for college and private lenders rake in exorbitant profits. Student loans have become the second most profitable business for the nation’s banks, after credit cards.
As a result of its aggressive marketing practices and shady business arrangements with colleges and universities, the stock price of the largest student loan company, Sallie Mae, has soared from $3 a share to more than $40. Just last week, JP Morgan and Bank of America announced plans to buy Sallie Mae for $25 billion, sending its stock even higher.
Education shouldn’t be about lining the pockets of banks and loan companies. It should be about giving every student the chance to have a better future.
Along with the Sunshine Act, Senators Durbin and Kennedy have introduced several other proposals to help fix the student loan system, including the Student Debt Relief Act and Student Aid Reward Act. These bills will reduce interest rates on student loans, cap student loan payments at 15% of income, and forgive loans for those who take public service jobs.
In the coming weeks, the Senate will act on these proposals, and Congress will have the chance to tell the nation what its priorities really are.
The current investigations of the student loan industry have made it clear that private lenders often don’t serve the best interest of students. Through a variety of corrupt practices, student loan companies gain an unfair advantage in marketing their loans to students and then charge interest rates of up to 19 percent.
To end these practices, Senators Dick Durbin and Kennedy have introduced the Student Loan Sunshine Act, which calls for full disclosure of special arrangements made between lenders and colleges and universities and prohibits lenders from offering lavish gifts to college officials in exchange for preferred status.
Students and their families struggle to pay for college and private lenders rake in exorbitant profits. Student loans have become the second most profitable business for the nation’s banks, after credit cards.
As a result of its aggressive marketing practices and shady business arrangements with colleges and universities, the stock price of the largest student loan company, Sallie Mae, has soared from $3 a share to more than $40. Just last week, JP Morgan and Bank of America announced plans to buy Sallie Mae for $25 billion, sending its stock even higher.
Education shouldn’t be about lining the pockets of banks and loan companies. It should be about giving every student the chance to have a better future.
Along with the Sunshine Act, Senators Durbin and Kennedy have introduced several other proposals to help fix the student loan system, including the Student Debt Relief Act and Student Aid Reward Act. These bills will reduce interest rates on student loans, cap student loan payments at 15% of income, and forgive loans for those who take public service jobs.
In the coming weeks, the Senate will act on these proposals, and Congress will have the chance to tell the nation what its priorities really are.
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