A bill that is expected to be signed into law will require Washington colleges to help students keep track of how much they owe in student loans and tell them what they can expect to pay monthly when they graduate.
Starting next year, Washington college students who take out student loans will get an email or letter from their school telling them how much they owe and how much their monthly loan payments will be after graduation.
The notification is part of a new bill, the Student Loan Transparency Act, which passed with bipartisan support in the state Legislature last week.
The notifications will begin July 1, 2018, and must be provided every time a student receives an offer of a new financial-aid package that includes a new or revised student loan. The notifications will also show how close a student is coming to the federal direct-loan borrowing limit. Undergraduates can borrow up to $5,500 per year in federal Perkins loans and between $5,500 and $12,500 in direct federal subsidized and unsubsidized loans.
Education Lab is a Seattle Times project that spotlights promising approaches to persistent challenges in public education. It is produced in partnership with the Solutions Journalism Network and is funded by a grant from the Bill & Melinda Gates Foundation.
Lawmakers said students often don’t realize how high their loan payments will be after they graduate. And many students take out new loans without realizing how much they already owe.
The bill covers public and private colleges and universities. Indiana, Wisconsin and Nebraska have passed similar legislation.
The bill was requested by the state Attorney General’s Office. One of its sponsors, Sen. Barbara Bailey, R-Oak Harbor, said she hoped it would cause students to think twice before taking out loans for college.