HR3153-119

What This Bill Does

The Understanding the True Cost of College Act standardizes how federally aided colleges present financial aid. The Education Secretary, in consultation with Treasury, Veterans Affairs, Defense, CFPB, and stakeholders such as students, veterans, servicemembers, families, community colleges, for-profit institutions, public and private nonprofits, financial-aid experts, counselors, access professionals, nonprofits, and consumer groups, must develop standard terminology and a standard Financial Aid Offer form. The form must list costs first, then grants and scholarships separately, with billed and nonbilled cost-of-attendance components, academic period, full-time or part-time basis, estimated tuition, grants by source and conditions, net price, clear federal loan labels, repayment disclosures, interest and fee links, repayment calculator links, deadlines and next steps, payment timing, FAFSA verification disclosure, financial aid office and Education Department contacts, and consumer-tested information such as cohort default rate, borrowing percentage, median federal loan debt, and calculations needed to understand aid gaps. The form may include payment plans, PLUS loan or private-loan disclosures, work-study details, terms and renewal conditions, separate subtotals, standard terminology, delivery confirmation, and special warnings when private education loans are mentioned for dependent students. Education must create terminology within three months, develop and consumer-test draft forms, establish veterans and military education-benefit language, allow supplemental information only if it does not misrepresent costs or net price, and require institutions to use the mandatory form and terms.

Who Benefits and How

Students comparing colleges benefit because aid offers must use standard terminology, cost categories, net price, and loan disclosures. Parents of dependent students benefit from clearer PLUS loan and private-loan warnings. Veterans and servicemembers benefit from standardized notices about GI Bill, military, and related education benefits. College access counselors benefit from comparable Financial Aid Offer documents across institutions. Consumer protection organizations benefit from a federal form that reduces misleading aid packaging.

Who Bears the Burden and How

Institutions of higher education receiving federal aid must replace or align aid letters with the mandatory form and standard terminology. College financial aid offices must report costs, grants, loans, work-study, conditions, contact information, delivery confirmations, and supplemental disclosures in the required format. Department of Education staff must consult agencies and stakeholders, consumer-test forms, finalize terminology, issue forms, and administer compliance. Private lenders may lose marketing advantage because institutions cannot present private education loans as awarded aid and must warn students to consider federal loans first. Financial aid software vendors must update offer templates, delivery systems, and data fields.

Key Provisions

• Requires Education to develop standard terminology and a standard Financial Aid Offer form.
• Requires cost-of-attendance, grants, scholarships, net price, federal loans, repayment links, work-study, deadlines, verification, and contact information in consumer-friendly format.
• Bars commingling grants, loans, work-study, PLUS loans, private loans, and other financing products.
• Requires consumer testing, veterans and military benefit language, standard terms within three months, and form development within nine months.
• Requires federally aided institutions to use the mandatory form and terms.