Private student loans are one of the riskiest ways to pay for college. They have much more in common with credit cards than they do with federal student loans. Private loans typically have variable interest rates that are higher for those who can least afford them – as high as 13.74% in 2016 – and they lack the important consumer protections and repayment options of federal loans.
The Project on Student Debt is working to improve consumer protections for private loan borrowers and ensure that students and families have the information they need to make safe and smart borrowing decisions.
Private Loans: Facts and Trends
June 2016 - Private student loans are one of the riskiest ways to finance a college education. Like credit cards, they usually have variable interest rates that are higher for those who can least afford them. Analysis of federal data from 2011-12 reveals almost half of borrowers could be using more affordable federal loans.
Letter to CFPB on Recent Problems with Sallie Mae's Student Loan Servicing Platform
November 13, 2013 - Letter urging the CFPB to investigate Sallie Mae's recent servicing problems to make sure customers are made whole, investigate if they affected both private and federal loan borrowers, and determine what steps are needed to prevent future problems.
Letter to Director Cordray Urging the CFPB to Deny "Grace Periods" for Private Loan Disclosures
August 7, 2013 - Letter from TICAS urging the CFPB to deny private lenders' request for a 30-day "compliance grace period," during which the lenders would not be required to inform borrowers of the interest rates on federal student loans. Students cannot ‘know before they owe' if they are not given the information required under the Truth in Lending Act, are not given accurate information, or only given it after they take out the loan.
Coalition Letter to Director Cordray Urging the CFPB to Require School Certification for Private Education Loans
June 17, 2013 - Coalition letter sent to Director Cordray at the Consumer Financial Protection Bureau (CFPB), urging the Bureau to use its authority under the Truth in Lending Act (TILA) to require school certification of all private education loans. The letter was signed by 29 organizations representing students, consumers, higher education institutions, faculty and staff, civil rights groups, and public policy organizations.
TICAS Comments on Proposed Rule Defining Larger Participants in the Student Loan Servicing Market
May 28, 2013 - Comments in response to the Consumer Financial Protection Bureau's proposed rule defining nonbank larger participants of the student loan servicing market subject to supervision by the Bureau.
TICAS Comments in Response to the CFPB's Request for Information on Private Student Loan Affordability
April 8, 2013 - Comments in response to the CFPB's request for information regarding an initiative to promote student loan affordability.
Coalition Letter to Representative Cohen in Support of the Private Student Loan Bankruptcy Fairness Act of 2013
February 6, 2013 - Over thirty-five organizations representing students, consumers, and higher education institutions sent a letter to Representative Cohen expressing strong support for the Private Student Loan Bankruptcy Fairness Act of 2013.
Coalition Letter to Senator Durbin in Support of the Fairness for Struggling Students Act of 2013
February 6, 2013 - Over thirty-five organizations representing students, consumers, and higher education institutions sent a letter to Senator Durbin expressing strong support for the Fairness for Struggling Students Act of 2013.
TICAS Comments to the CFPB on Private Student Loans
August 13, 2012 - TICAS recently submitted comments in response to the Consumer Financial Protection Bureau's request for information regarding complaints from private education loan borrowers.
TICAS Statement on Final Senate Report on For-Profit College Industry
July 30, 2012 - Statement from Lauren Asher on the report from the Senate Health, Education, Labor and Pensions (HELP) Committee's two-year investigation of the for-profit college industry, which makes the urgent need for reform abundantly clear.
New Federal Report Underscores Need for Private Student Loan Reforms
July 20, 2012 - Press release on the report released by the federal Consumer Financial Protection Bureau (CFPB) and U.S. Department of Education, which sheds much-needed light on the private student loan market and the urgent need for reforms.
TICAS Comments on the Proposed Rule Defining Larger Participants in Certain Consumer Financial Product and Service Markets
April 16, 2012 - Comments in response to the Consumer Financial Protection Bureau's proposed rule defining the "larger" debt collectors and consumer reporting agencies subject to supervision by the Bureau.
Private Student Loan Borrowers Finally Have a Place to Turn for Help
March 5, 2012 - Statement of Pauline Abernathy on the launch of the Consumer Financial Protection Bureau's consumer response function. Students and private loan borrowers finally have a place to turn to for help, whether they are just considering taking out a private loan, they are having problems repaying their private loan, or they are managing a loan that has gone into default and may have been referred to a debt collector.
TICAS Comments to the CFPB on Streamlining Inherited Regulations
March 5, 2012 - Response to the Consumer Financial Protection Bureau's request for public comment on streamlining regulations it inherited from other federal agencies.
TICAS Comments on Private Student Loans
January 17, 2012 - Official comments in response to the Consumer Financial Protection Bureau's "Request for Information Regarding Private Education Loans and Private Educational Lenders" (FR Doc. 2011-29737, Docket No. CFPB-2011-0037).
Risky Private Student Lending on the Rise Again
December 22, 2011 - One-page fact sheet on the recent signs of renewed growth in the private student loan market.
Critical Choices: How Colleges Can Help Students and Families Make Better Decisions about Private Loans
July 13, 2011 - Our report documents promising practices that a variety of financial aid offices are using to help prospective borrowers avoid unnecessarily risky and costly debt. It also identifies some problematic practices that bypass key opportunities to inform students' and parents' borrowing decisions.
Coalition Letter to Representative Cohen in support of the Private Student Loan Bankruptcy Fairness Act of 2011
May 26, 2011 - Thirty-five organizations representing students, consumers, and higher education institutions sent a letter to Ranking Member Cohen expressing strong support for the Private Student Loan Bankruptcy Fairness Act of 2011.
Coalition Letter to Senator Durbin in support of the Fairness for Struggling Students Act of 2011
May 26, 2011 - Thirty-five organizations representing students, consumers, and higher education institutions sent a letter to Senator Durbin expressing strong support for the Fairness for Struggling Students Act of 2011.
Bankruptcy Relief for Private Student Loan Borrowers Advances
September 15, 2010 - Statement of Lauren Asher in response to the House Judiciary Committee's Subcommittee on Commercial and Administrative Law's passage of the Private Student Loan Bankruptcy Fairness Act of 2010 (H.R. 5043). The bill reverses the unfair and unjustified special protections for lenders of private student loans enacted in 2005.
Big Wins for Students in Final Financial Reform Bill
June 25, 2010 - Statement of Pauline Abernathy on the final financial reform bill that will be voted on by the House and Senate. This bill will improve consumer protections for private student loans.
Coalition Letter to Senate on CFPB and Private Loans
May 3, 2010 - More than 40 organizations signed this letter urging the Senate to strengthen consumer protections for private student loans through the Consumer Financial Protection Bureau in the financial reform
Sallie Mae’s Private Loans Exempt from Financial Reform Bill?
May 3, 2010 - Press release about the Senate's version of the financial reform bill, and implications for private student loans.
Borrowers with Private Student Loans Could Get Bankruptcy Relief
April 22, 2010 - Statement of Lauren Asher on legislation and House Judiciary hearing to address fair treatment of private student loans in bankruptcy.
Coalition Letter in Support of Bankruptcy Fairness
April 21, 2010 - Letter from a broad coalition of groups representing students, consumers, and institutions of higher education, and civil rights and public policy organizations supporting legislation to treat private loans like other consumer debt in bankruptcy.
Statement on House Passage of CFPA
December 11, 2009 - Statement of Lauren Asher on House passage of a bill to create the Consumer Financial Protection Agency, which would have oversight over all private student loans and help protect consumers from these and other risky financial products.
Coalition Letter Supporting Mandatory Certification of Private Loans in CFPA
December 10, 2009 - Twenty-five organizations wrote a letter to Reps. Polis, Murphy, and Bishop in support of their amendment to require school certification of private student loans, as part of H.R. 4173
Coalition Letter to Senate about Consumer Financial Protection Agency
December 2, 2009 - Twenty-nine organizations signed this letter to Sens. Dodd and Shelby of the Senate Banking Committee, thanking Sen. Dodd for making sure that all private student loans, including those made by colleges, fall under the jurisdiction of the Consumer Financial Protection Agency.
Coalition Letter about Consumer Financial Protection Agency
October 8, 2009 - Thirty-two organizations signed this letter to Rep. Barney Frank, Chair of the House Financial Services Committee, urging that all private student loans -- including those made by colleges -- fall under the jurisdiction of the Consumer Financial Protection Agency.
Official Comment on Self-Certification Form
November 25, 2009 - The self-certification form must be filled out by students applying for a private student loan, starting in February 2010. Our official public comments suggest ways to make sure students know about cheaper, safer federal aid options and seek counsel from the financial aid office before taking out a private student loan. See the form wtih our suggested edits
Testimony of Lauren Asher before House Judiciary Subcommittee on Commercial and Administrative Law
September 23, 2009 - Lauren Asher was an invited witness at the hearing, "An Undue Hardship? Discharging Educational Debt in Bankruptcy." Her testimony focuses on why private student loans should be treated the same as other consumer debt in bankruptcy.
Coalition Letter in Favor of Discharging Private Student Loans in Bankruptcy
September 23, 2009 - Eighteen organizations signed on in a letter to Congress urging them to make private student loans dischargeable through bankruptcy.
Borrowers with Private Student Loans Blocked from Bankruptcy Relief
September 21, 2009 - Media alert in advance of congressional hearing on student loans and bankruptcy.
Summary of New Disclosures for Private Student Loans
August 25, 2009 - We were disappointed that the Federal Reserve Board did not adopt most of our suggestions in their regulations for new private loan disclosures mandated by the Higher Education Opportunity Act of 2008. This summary breaks down our suggestions and how they fared.
Comments to Federal Reserve Board on Private Student Loan Disclosures
May 26, 2009 - The Institute for College Access & Success and 10 other national consumer groups submitted public comments about the proposed rules for new private loan disclosures.
New Data Show Big Increases in Private Student Loan Borrowing
April 21, 2009 - New analysis reveals alarming increases in private loan borrowing: the share of all undergraduate students who borrowed private student loans jumped from 5% in 2003-04 to 14% in 2007-08.
Group Letter to Secretary Geithner on the Term Asset-Backed Securities Loan Facility
February 9, 2009 - Nineteen organizations urged U.S. Treasury Secretary Timothy Geithner to make the receipt of TALF funds for private student loan financing conditional upon adequate consumer protections and better data reporting. We sent a similar letter to former Treasury Secretary Henry Paulson on November 19, 2009.
Policy Agenda to Address Rising Student Debt
January 2009 - Our 2009 policy priorities include treating private student loans like other consumer debt in bankruptcy, requiring that schools certify private loans before lenders disburse funds, and improving reporting and data collection about private loans.
Letter in Support of Consumer Protections in Private Loan Bailout
January 26, 2009 - This group letter calls on Reps. Barney Frank and George Miller, who respectively chair the House Financial Services and Education commitees, to push for necessary borrower protections should bailout funds be given to private loan lenders.
Testimony of Lauren Asher before U.S. Department of Education on HEOA Regulations
October 2, 2008 - Lauren Asher, president of the Institute for College Access & Success, testified about a range of issues in the Higher Education Opportunity Act of 2008, including private student loan disclosures, financial aid award letters, proprietary schools, and cohort default rates.
April 17, 2008 - At least one million community college students lack access to federal loans, not because of the credit crunch, but because their schools don't participate in the federal loan programs. This pushes students who need to borrow to resort to risky private loans, payday loans, and credit cards, or to drop out or reduce their course load. Our brief also found significant gaps in loan access between racial and ethnic groups. See the press release and supporting materials.
Students Need Protection from Subprime Student Loans
February 5, 2008 - Statement of Robert Shireman, founder of the Project on Student Debt, calling for an amendment to the Higher Education Act that would allow private student loans to be dischargeable in bankruptcy.
Expert Praises Committee Action to Improve Consumer Protections for Private Student Loans, Urges Additional Provisions
August 1, 2007 - Robert Shireman comments on the Senate Banking Committee's passage of a bill that improved disclosures and reduced confusion about private student loans. This legislation laid the groundwork for the reforms that were included in the 2008 reauthorization of the Higher Education Act.
Private Loan Policy Agenda
June 4, 2007 - Our first policy agenda for private student loans outlines ways to provide students and parents with private loans access to the kind of information and consumer rights that other types of borrowers can count on.
Private Student Loans: More Important Than Child Support and Taxes?
May 30, 2007 - A blog post by Robert Shireman about the unfair and unfounded exemption that makes private student loans harder to discharge in bankruptcy than other consumer debt.
Shopping for Student Loans: Treacherous Territory
April 25, 2007 - A blog post by Robert Shireman about the lack of transparency available to consumers about private loans.