HR6502-119

What This Bill Does

The College Financial Aid Clarity Act creates a standardized financial-aid-offer rule for institutions of higher education receiving federal assistance under the Higher Education Act. Beginning July 1, 2029, every paper, electronic, or mobile-optimized financial aid offer must use required terminology, include required information, provide supplemental disclosures, and use the same terms consistently in related financial aid communications. If an electronic offer asks a student to confirm receipt, the school may not treat that confirmation as accepting or rejecting aid.

The Secretary of Education must establish consumer testing within nine months, consult relevant federal agencies, include representatives of students, families, institutions, counselors, nonprofits, private lenders, and states, and complete testing within eight months after the process is established. By July 1, 2028, the Secretary must publish formatting requirements and notify schools. Starting July 1, 2029 and every other year, the Secretary must collect a random representative sample of financial aid offers and review compliance.

Schools must disclose program of study, award year, required costs, cost of attendance, grant and scholarship aid, annual net price required for completion, annual net price of attendance, loan amounts, interest rates, fees, repayment obligations, work-study earning limits, net price calculator links, College Scorecard links, acceptance or adjustment deadlines, payment timing, FAFSA verification information, financial-aid-office contacts, and program-level average net price data. Definitions cover required costs, grant and scholarship aid, net price, program of study, CIP code, credential level, program length, and time to credential.

Who Benefits and How

Prospective students benefit because financial aid offers must separate grants from loans and required costs from other costs. Low-income students benefit from clearer net-price and grant information before enrolling. First-generation college students benefit from plain-language terminology and links to College Scorecard and student aid resources. Veterans and servicemembers benefit because consumer testing must include their representatives. Students' families benefit from renewability, outside-aid, loan, and payment-timing disclosures. College counselors benefit from more comparable aid offers across institutions.

Who Bears the Burden and How

Institutions of higher education must redesign financial aid offers, websites, and related communications by July 1, 2029. College financial-aid offices must add required terminology, supplemental disclosures, program-level price metrics, and loan disclosures. Department of Education student-aid staff must conduct consumer testing, publish requirements, notify schools, and review random samples every other year. Institutional research offices must calculate program-level net price and completion-cost data. Private lenders and scholarship organizations may need to participate in consumer testing or adapt disclosures. Schools with confusing aid offers may face compliance reviews.

Key Provisions

• Requires standardized financial aid offers for Higher Education Act participating institutions beginning July 1, 2029.
• Requires Education Department consumer testing with student, family, school, counselor, nonprofit, lender, and state representatives.
• Requires publication of formatting requirements by July 1, 2028.
• Requires biennial random representative compliance reviews of financial aid offers.
• Requires offers to disclose required costs, cost of attendance, grants, scholarships, loans, net prices, work-study, program data, and deadlines.
• Prohibits treating electronic receipt confirmation as aid acceptance or rejection.
• Defines required costs, grant and scholarship aid, net price measures, program of study, CIP code, credential level, program length, and time to credential.