S1558-119

1. Short title This Act may be cited as the Understanding the True Cost of College Act of 2025.

2. Financial aid offer form Section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note) is amended to read as follows: The Secretary of Education, in consultation with the heads of relevant Federal agencies, shall develop standard terminology and a standard form for financial aid offers based on recommendations from representatives of students, veterans, servicemembers, students’ families, institutions of higher education (including community colleges, for-profit institutions, 4-year public institutions, and 4-year private nonprofit institutions), financial aid experts, secondary school and postsecondary counselors, college access professionals, nonprofit organizations, and consumer groups. The standard form developed pursuant to subsection (a) shall be titled Financial Aid Offer and shall include the following items in a consumer-friendly manner that is simple and understandable, with costs listed first followed by grants and scholarships, clearly separated from each other with separate headings: Information on the student's estimated cost of attendance, including the following: The total cost of all items described in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll) that are billed to the student by the institution or otherwise required by the institution for enrollment, including such total cost disaggregated by the cost of each such item, including, as determined under such section— tuition and fees (and other required expenses); and housing and food for a student participating in institutionally owned or operated food services or institutionally owned or operated housing. The total cost of all items described in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll) that are not billed to the student by the institution or otherwise required by the institution for enrollment, including such total cost disaggregated by the cost of each such item, including, as determined under such section— the component totals each for housing and food costs for students who reside off-campus or off campus with family; books, supplies, equipment, course materials, and rental or purchase of a personal computer; and transportation. The academic period covered by the Financial Aid Offer, and an explanation that the amount of financial aid offered may change— for academic periods not covered by the Financial Aid Offer; or by program. An indication of whether cost and aid estimates are based on full-time or part-time enrollment. An indication, as applicable, about whether the tuition and fees are estimated based on the previous year, or are set, for the academic period indicated in accordance with subparagraph (B). The aggregate amount of grants and scholarships, differentiated by source, that the student does not have to repay, such as grant aid offered under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) and grant aid offered through other Federal programs, grant and scholarship aid offered by the institution, grant and scholarship aid offered by the State, and, if known, grant and scholarship aid from an outside source to the student for such academic period, including— a disclosure that the grants and scholarships do not have to be repaid; and if institutional aid is included— the conditions under which the student can expect to receive similar amounts of such financial aid for each academic period the student is enrolled at the institution; and whether the institutional aid offer may change if grants or scholarships from outside sources are applied after the student receives the Financial Aid Offer, and, if applicable, how that aid will change. The net price that the student, or the student's family on behalf of the student, is estimated to have to pay for the student to attend the institution for such academic period, equal to— the cost of attendance as described in paragraph (1)(A) for the student for the period indicated in paragraph (1)(B); minus the amount of grant and scholarship aid described in paragraph (2) that is included in the Financial Aid Offer. A disclosure that the net price is an estimate of the total expenses for the year and not equivalent to the amount the student will owe directly to the institution. Information on any loan under part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et seq.; 20 U.S.C. 1087aa et seq.) (except a Federal Direct PLUS Loan under part D of that Act) that the institution recommends for the student for the academic period covered by the Financial Aid Offer, which shall be made— with clear use of the word loan to describe the recommended loan amounts; and with clear labeling of subsidized and unsubsidized loans. A disclosure that such loans have to be repaid and a disclosure that the student can borrow a lesser or, if applicable, greater amount than the recommended loan amount. A disclosure that the interest rates and fees on such loans are set annually and affect total cost over time, and a link to a Department of Education website that includes current information on interest rates and fees. A link to the Department of Education's repayment calculator website for students with instruction that this website contains customizable estimates of expected repayment costs under different loan repayment plans. The deadlines and a summary of the process (including the next steps) for— accepting the financial aid offered; adjusting the amount of financial aid offered; and declining the financial aid offered. Information on when and how costs described in paragraph (1)(A)(i) must be paid, including a clear indication of whether such cost is required or optional for the student. A disclosure that verification of information provided on the Free Application for Federal Student Aid may require the student to submit further documentation. Information about where a student or the student’s family can seek additional information regarding the financial aid offered, including contact information for the institution’s financial aid office and the Department of Education’s website on financial aid. Any other information the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Bureau of Consumer Financial Protection, determines necessary (based on the results of the consumer testing under subsection (g)(2)) so that students and parents can make informed loan borrowing decisions, which may include— the most recent cohort default rate, as defined in section 435(m) of the Higher Education Act of 1965 (20 U.S.C. 1085(m)), with respect to an institution where more than 30 percent of enrolled students borrow loans to pay for their education, and a comparison to the national average cohort default rate; the percentage of students at the institution who borrow student loans; the median loan debt at graduation for students at the institution (clearly marked as including only Federal loans if private loan data are not available to be included); and any additional calculations determined necessary for ensuring that students understand full college costs, financial aid gaps, and options for covering those gaps. The standard form developed under subsection (a) shall include, in addition to the information described in subsection (b), to be included on the Financial Aid Offer in a concise format determined by the Secretary of Education, in consultation with the heads of relevant Federal agencies and the individuals and entities described in subsection (a), the following information: At the institution’s discretion— additional options and potential resources for paying for the amount listed in subsection (b)(3), such as tuition payment plans and the terms and conditions of those plans; and a disclosure that Federal Direct PLUS Loans made under part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et seq.), private education loans, or other financing products may be available to cover remaining need, except that the institution— may not include an amount for such Federal Direct PLUS Loans, private education loans, or other financing products; and shall include a disclosure that such loans and agreements— are subject to an additional application process and have to be repaid by the borrower; and may not be eligible for all the benefits available for Federal Direct Stafford Loans or Federal Direct Unsubsidized Stafford Loans. The following information relating to private education loans and other financing products: A disclosure that students considering borrowing to cover the cost of attendance should consider available Federal student loans prior to applying for private education loans or other financing products, including an explanation that Federal student loans offer generally more favorable terms and beneficial repayment options than private education loans and other financing products. The impact of a proposed private education loan or other financing product on the student’s potential eligibility for other financial assistance, including Federal financial assistance under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.). A statement explaining the student’s ability to select a private educational lender or other financing product provider of the student’s choice. Information on work-study employment opportunities offered in accordance with part C of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087–51 et seq.), institutional work-study programs, or State work-study programs, including— the maximum annual amount the student may earn through the program; and a disclosure that any work-study amount offered may be— subject to the availability of qualified employment opportunities upon the student's enrollment; and disbursed over time as earned by the student. Each Financial Aid Offer shall meet the following requirements: Include, in addition to the requirements described in subsections (b) and (c), a concise summary, in plain language, of— the terms and conditions of financial aid recommended under paragraphs (2) and (4) of subsection (b) and subsection (c)(3), and a method to provide students with additional information about such terms and conditions, such as links to the supplementary information; and Federal, State, or institutional conditions required to receive and renew financial aid and a method to provide students with additional information about these conditions, such as links to the supplementary information. Clearly distinguish between the aid offered under paragraphs (2) and (4) of subsection (b) and subsection (c)(3), by including a subtotal for the aid offered in each of such paragraphs and by refraining from commingling the different types of aid described in such paragraphs. Use standard terminology and definitions, as described in subsection (e)(1) and use plain language where possible. If an institution’s recommended Federal student loan aid offered in subsection (b)(4) is less than the Federal maximum available to the student, the institution shall provide additional information on Federal student loans, including the types and amounts for which the student is eligible in an attached document or web page. Use the standard offer form described in subsection (e)(2). Include the standardized statement regarding the possible availability of Federal education benefits, as established by the Secretary in accordance with subsection (e)(3). Include a delivery confirmation for electronic Financial Aid Offers, except that receipt of the Financial Aid Offer shall not be considered an acceptance or rejection of aid by the student. With respect to dependent students, any reference to private education loans shall be accompanied by— information about the availability of, and terms and conditions associated with, Federal Direct PLUS Loans under section 455 of the Higher Education Act of 1965 (20 U.S.C. 1087e) for the student's parents regardless of family income; and a notification of the student’s increased eligibility for Federal student loans under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) if the student's parents are not able to borrow under the Federal Direct PLUS Loan program. Not later than 3 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Consumer Financial Protection Bureau, and the individuals and entities described in subsection (a), shall establish standard terminology and definitions for the terms described in subsection (b). The Secretary of Education shall develop multiple draft financial aid offer forms for consumer testing, carry out consumer testing for such forms, and establish a finalized standard financial aid offer form, in accordance with the process established under subsection (g) and the requirements of this section. The Secretary may develop separate financial aid offer forms for— undergraduate students and graduate students; and first-time students and returning students. The Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury, the Secretary of Veterans Affairs, the Secretary of Defense, and the Director of the Consumer Financial Protection Bureau, shall establish standard language notifying students that they may be eligible for education benefits (and where students can locate more information about such benefits) including benefits in accordance with each of the following: Chapter 30, 31, 32, 33, 34, or 35 of title 38, United States Code. Chapter 101, 105, 106A, 1606, 1607, or 1608 of title 10, United States Code. Section 1784a, 2005, or 2007 of title 10, United States Code. Nothing in this section shall preclude an institution from supplementing the Financial Aid Offer with additional information if such additional information utilizes the same standard terminology identified in subsection (e)(1) and does not misrepresent costs, financial aid offered, or net price. Nothing in this section shall preclude an institution from deleting a required item on a Financial Aid Offer if— the student is ineligible for such item; the institution does not participate in the program related to such item; or the cost of attendance item is not applicable to the student. Not later than 9 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Consumer Financial Protection Bureau, and the individuals and entities described in subsection (a), shall design and produce multiple draft financial aid offer forms for consumer testing with postsecondary students or prospective students. In developing that form, the Secretary shall ensure— that the headings described in paragraphs (1) through (4) of subsection (b) are in the same font, appear in the same order, and are displayed prominently on the financial aid offer form, such that none of that information is inappropriately omitted or de-emphasized; that the other information required in subsection (b) appears in a standard format and design on the Financial Aid Offer; and that the institution may include a logo or brand alongside the title of the Financial Aid Offer. Not later than 9 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, shall establish a process to submit the financial aid offer form drafts developed under paragraph (1) for consumer testing among representatives of students (including low-income students, first-generation college students, adult students, veterans, servicemembers, and prospective students), students’ families (including low-income families, families with first-generation college students, and families with prospective students), institutions of higher education, secondary school and postsecondary counselors, and nonprofit consumer groups. During such consumer testing, the Secretary shall ensure that not less than 16 and not more than 24 eligible institutions use the draft forms developed under paragraph (1), including institutions— that reflect a proportionate representation (based on the total number of students enrolled in postsecondary education) of community colleges, for-profit institutions, 4-year public institutions, and 4-year private nonprofit institutions; and that reflect geographic diversity. The Secretary of Education shall ensure that the consumer testing under this paragraph lasts no longer than 8 months after the process for consumer testing is developed under subparagraph (A). The results of consumer testing under paragraph (2) shall be used in the final development of the financial aid offer form. Not later than 3 months after the date the consumer testing under paragraph (2) concludes, the Secretary of Education shall submit to Congress and publish on its website the final standard financial aid offer form and a report detailing the results of such testing, including whether the Secretary of Education added any additional items to the standard financial aid offer form pursuant to subsection (b)(6). The Secretary of Education may modify or remove the definitions, terms, formatting, or design of the financial aid offer form based on the results of consumer testing required under this subsection and before finalizing the form, or in subsequent consumer testing. The Secretary may also recommend additional changes to Congress. 484.Financial aid offer form(a)Standard form and terminologyThe Secretary of Education, in consultation with the heads of relevant Federal agencies, shall develop standard terminology and a standard form for financial aid offers based on recommendations from representatives of students, veterans, servicemembers, students’ families, institutions of higher education (including community colleges, for-profit institutions, 4-year public institutions, and 4-year private nonprofit institutions), financial aid experts, secondary school and postsecondary counselors, college access professionals, nonprofit organizations, and consumer groups.(b)Key required contents for aid offerThe standard form developed pursuant to subsection (a) shall be titled Financial Aid Offer and shall include the following items in a consumer-friendly manner that is simple and understandable, with costs listed first followed by grants and scholarships, clearly separated from each other with separate headings:(1)Cost information(A)In generalInformation on the student's estimated cost of attendance, including the following:(i)Direct costsThe total cost of all items described in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll) that are billed to the student by the institution or otherwise required by the institution for enrollment, including such total cost disaggregated by the cost of each such item, including, as determined under such section—(I)tuition and fees (and other required expenses); and(II)housing and food for a student participating in institutionally owned or operated food services or institutionally owned or operated housing.(ii)Indirect costsThe total cost of all items described in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll) that are not billed to the student by the institution or otherwise required by the institution for enrollment, including such total cost disaggregated by the cost of each such item, including, as determined under such section—(I)the component totals each for housing and food costs for students who reside off-campus or off campus with family;(II)books, supplies, equipment, course materials, and rental or purchase of a personal computer; and(III)transportation.(B)Academic periodThe academic period covered by the Financial Aid Offer, and an explanation that the amount of financial aid offered may change—(i)for academic periods not covered by the Financial Aid Offer; or(ii)by program.(C)Enrollment statusAn indication of whether cost and aid estimates are based on full-time or part-time enrollment.(D)Estimated or setAn indication, as applicable, about whether the tuition and fees are estimated based on the previous year, or are set, for the academic period indicated in accordance with subparagraph (B).(2)Grants and scholarshipsThe aggregate amount of grants and scholarships, differentiated by source, that the student does not have to repay, such as grant aid offered under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) and grant aid offered through other Federal programs, grant and scholarship aid offered by the institution, grant and scholarship aid offered by the State, and, if known, grant and scholarship aid from an outside source to the student for such academic period, including—(A)a disclosure that the grants and scholarships do not have to be repaid; and(B)if institutional aid is included—(i)the conditions under which the student can expect to receive similar amounts of such financial aid for each academic period the student is enrolled at the institution; and(ii)whether the institutional aid offer may change if grants or scholarships from outside sources are applied after the student receives the Financial Aid Offer, and, if applicable, how that aid will change.(3)Net price(A)In generalThe net price that the student, or the student's family on behalf of the student, is estimated to have to pay for the student to attend the institution for such academic period, equal to—(i)the cost of attendance as described in paragraph (1)(A) for the student for the period indicated in paragraph (1)(B); minus(ii)the amount of grant and scholarship aid described in paragraph (2) that is included in the Financial Aid Offer.(B)DisclosureA disclosure that the net price is an estimate of the total expenses for the year and not equivalent to the amount the student will owe directly to the institution.(4)Loans(A)In generalInformation on any loan under part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et seq.; 20 U.S.C. 1087aa et seq.) (except a Federal Direct PLUS Loan under part D of that Act) that the institution recommends for the student for the academic period covered by the Financial Aid Offer, which shall be made—(i)with clear use of the word loan to describe the recommended loan amounts; and(ii)with clear labeling of subsidized and unsubsidized loans.(B)Disclosure on repaymentA disclosure that such loans have to be repaid and a disclosure that the student can borrow a lesser or, if applicable, greater amount than the recommended loan amount.(C)Disclosure on interest rates and feesA disclosure that the interest rates and fees on such loans are set annually and affect total cost over time, and a link to a Department of Education website that includes current information on interest rates and fees.(D)Link to repayment calculatorA link to the Department of Education's repayment calculator website for students with instruction that this website contains customizable estimates of expected repayment costs under different loan repayment plans.(5)Process for accepting, adjusting, or declining aid and next steps(A)In generalThe deadlines and a summary of the process (including the next steps) for—(i)accepting the financial aid offered;(ii)adjusting the amount of financial aid offered; and(iii)declining the financial aid offered.(B)Information on paying costsInformation on when and how costs described in paragraph (1)(A)(i) must be paid, including a clear indication of whether such cost is required or optional for the student.(C)Disclosure on verification of informationA disclosure that verification of information provided on the Free Application for Federal Student Aid may require the student to submit further documentation.(D)Contact informationInformation about where a student or the student’s family can seek additional information regarding the financial aid offered, including contact information for the institution’s financial aid office and the Department of Education’s website on financial aid.(6)Additional informationAny other information the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Bureau of Consumer Financial Protection, determines necessary (based on the results of the consumer testing under subsection (g)(2)) so that students and parents can make informed loan borrowing decisions, which may include—(A)the most recent cohort default rate, as defined in section 435(m) of the Higher Education Act of 1965 (20 U.S.C. 1085(m)), with respect to an institution where more than 30 percent of enrolled students borrow loans to pay for their education, and a comparison to the national average cohort default rate;(B)the percentage of students at the institution who borrow student loans;(C)the median loan debt at graduation for students at the institution (clearly marked as including only Federal loans if private loan data are not available to be included); and(D)any additional calculations determined necessary for ensuring that students understand full college costs, financial aid gaps, and options for covering those gaps.(c)Other required contents for financial aid offerThe standard form developed under subsection (a) shall include, in addition to the information described in subsection (b), to be included on the Financial Aid Offer in a concise format determined by the Secretary of Education, in consultation with the heads of relevant Federal agencies and the individuals and entities described in subsection (a), the following information:(1)Additional optionsAt the institution’s discretion—(A)additional options and potential resources for paying for the amount listed in subsection (b)(3), such as tuition payment plans and the terms and conditions of those plans; and(B)a disclosure that Federal Direct PLUS Loans made under part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et seq.), private education loans, or other financing products may be available to cover remaining need, except that the institution—(i)may not include an amount for such Federal Direct PLUS Loans, private education loans, or other financing products; and(ii)shall include a disclosure that such loans and agreements—(I)are subject to an additional application process and have to be repaid by the borrower; and(II)may not be eligible for all the benefits available for Federal Direct Stafford Loans or Federal Direct Unsubsidized Stafford Loans.(2)Information on private education loans and other financing productsThe following information relating to private education loans and other financing products:(A)A disclosure that students considering borrowing to cover the cost of attendance should consider available Federal student loans prior to applying for private education loans or other financing products, including an explanation that Federal student loans offer generally more favorable terms and beneficial repayment options than private education loans and other financing products.(B)The impact of a proposed private education loan or other financing product on the student’s potential eligibility for other financial assistance, including Federal financial assistance under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.).(C)A statement explaining the student’s ability to select a private educational lender or other financing product provider of the student’s choice.(3)Student employmentInformation on work-study employment opportunities offered in accordance with part C of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087–51 et seq.), institutional work-study programs, or State work-study programs, including—(A)the maximum annual amount the student may earn through the program; and(B)a disclosure that any work-study amount offered may be—(i)subject to the availability of qualified employment opportunities upon the student's enrollment; and(ii)disbursed over time as earned by the student.(d)Additional requirements for financial aid offersEach Financial Aid Offer shall meet the following requirements:(1)Include, in addition to the requirements described in subsections (b) and (c), a concise summary, in plain language, of—(A)the terms and conditions of financial aid recommended under paragraphs (2) and (4) of subsection (b) and subsection (c)(3), and a method to provide students with additional information about such terms and conditions, such as links to the supplementary information; and(B)Federal, State, or institutional conditions required to receive and renew financial aid and a method to provide students with additional information about these conditions, such as links to the supplementary information.(2)Clearly distinguish between the aid offered under paragraphs (2) and (4) of subsection (b) and subsection (c)(3), by including a subtotal for the aid offered in each of such paragraphs and by refraining from commingling the different types of aid described in such paragraphs.(3)Use standard terminology and definitions, as described in subsection (e)(1) and use plain language where possible.(4)If an institution’s recommended Federal student loan aid offered in subsection (b)(4) is less than the Federal maximum available to the student, the institution shall provide additional information on Federal student loans, including the types and amounts for which the student is eligible in an attached document or web page.(5)Use the standard offer form described in subsection (e)(2).(6)Include the standardized statement regarding the possible availability of Federal education benefits, as established by the Secretary in accordance with subsection (e)(3).(7)Include a delivery confirmation for electronic Financial Aid Offers, except that receipt of the Financial Aid Offer shall not be considered an acceptance or rejection of aid by the student.(8)With respect to dependent students, any reference to private education loans shall be accompanied by—(A)information about the availability of, and terms and conditions associated with, Federal Direct PLUS Loans under section 455 of the Higher Education Act of 1965 (20 U.S.C. 1087e) for the student's parents regardless of family income; and(B)a notification of the student’s increased eligibility for Federal student loans under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) if the student's parents are not able to borrow under the Federal Direct PLUS Loan program.(e)Standard information established by the Secretary(1)Standard terminology and definitionsNot later than 3 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Consumer Financial Protection Bureau, and the individuals and entities described in subsection (a), shall establish standard terminology and definitions for the terms described in subsection (b).(2)Standard form(A)In generalThe Secretary of Education shall develop multiple draft financial aid offer forms for consumer testing, carry out consumer testing for such forms, and establish a finalized standard financial aid offer form, in accordance with the process established under subsection (g) and the requirements of this section.(B)Separate financial aid offer formsThe Secretary may develop separate financial aid offer forms for—(i)undergraduate students and graduate students; and(ii)first-time students and returning students.(3)Additional benefitsThe Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury, the Secretary of Veterans Affairs, the Secretary of Defense, and the Director of the Consumer Financial Protection Bureau, shall establish standard language notifying students that they may be eligible for education benefits (and where students can locate more information about such benefits) including benefits in accordance with each of the following:(A)Chapter 30, 31, 32, 33, 34, or 35 of title 38, United States Code.(B)Chapter 101, 105, 106A, 1606, 1607, or 1608 of title 10, United States Code.(C)Section 1784a, 2005, or 2007 of title 10, United States Code.(f)Supplemental information; removal of information(1)Supplemental informationNothing in this section shall preclude an institution from supplementing the Financial Aid Offer with additional information if such additional information utilizes the same standard terminology identified in subsection (e)(1) and does not misrepresent costs, financial aid offered, or net price.(2)Removal of informationNothing in this section shall preclude an institution from deleting a required item on a Financial Aid Offer if—(A)the student is ineligible for such item;(B)the institution does not participate in the program related to such item; or(C)the cost of attendance item is not applicable to the student.(g)Development of financial aid offer form(1)Draft formNot later than 9 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Consumer Financial Protection Bureau, and the individuals and entities described in subsection (a), shall design and produce multiple draft financial aid offer forms for consumer testing with postsecondary students or prospective students. In developing that form, the Secretary shall ensure—(A)that the headings described in paragraphs (1) through (4) of subsection (b) are in the same font, appear in the same order, and are displayed prominently on the financial aid offer form, such that none of that information is inappropriately omitted or de-emphasized;(B)that the other information required in subsection (b) appears in a standard format and design on the Financial Aid Offer; and(C)that the institution may include a logo or brand alongside the title of the Financial Aid Offer.(2)Consumer testing(A)In generalNot later than 9 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, shall establish a process to submit the financial aid offer form drafts developed under paragraph (1) for consumer testing among representatives of students (including low-income students, first-generation college students, adult students, veterans, servicemembers, and prospective students), students’ families (including low-income families, families with first-generation college students, and families with prospective students), institutions of higher education, secondary school and postsecondary counselors, and nonprofit consumer groups.(B)PilotDuring such consumer testing, the Secretary shall ensure that not less than 16 and not more than 24 eligible institutions use the draft forms developed under paragraph (1), including institutions—(i)that reflect a proportionate representation (based on the total number of students enrolled in postsecondary education) of community colleges, for-profit institutions, 4-year public institutions, and 4-year private nonprofit institutions; and(ii)that reflect geographic diversity.(C)Length of consumer testingThe Secretary of Education shall ensure that the consumer testing under this paragraph lasts no longer than 8 months after the process for consumer testing is developed under subparagraph (A).(3)Final form(A)In generalThe results of consumer testing under paragraph (2) shall be used in the final development of the financial aid offer form.(B)Reporting requirementNot later than 3 months after the date the consumer testing under paragraph (2) concludes, the Secretary of Education shall submit to Congress and publish on its website the final standard financial aid offer form and a report detailing the results of such testing, including whether the Secretary of Education added any additional items to the standard financial aid offer form pursuant to subsection (b)(6).(4)Authority to modifyThe Secretary of Education may modify or remove the definitions, terms, formatting, or design of the financial aid offer form based on the results of consumer testing required under this subsection and before finalizing the form, or in subsequent consumer testing. The Secretary may also recommend additional changes to Congress..

484. Financial aid offer form The Secretary of Education, in consultation with the heads of relevant Federal agencies, shall develop standard terminology and a standard form for financial aid offers based on recommendations from representatives of students, veterans, servicemembers, students’ families, institutions of higher education (including community colleges, for-profit institutions, 4-year public institutions, and 4-year private nonprofit institutions), financial aid experts, secondary school and postsecondary counselors, college access professionals, nonprofit organizations, and consumer groups. The standard form developed pursuant to subsection (a) shall be titled Financial Aid Offer and shall include the following items in a consumer-friendly manner that is simple and understandable, with costs listed first followed by grants and scholarships, clearly separated from each other with separate headings: Information on the student's estimated cost of attendance, including the following: The total cost of all items described in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll) that are billed to the student by the institution or otherwise required by the institution for enrollment, including such total cost disaggregated by the cost of each such item, including, as determined under such section— tuition and fees (and other required expenses); and housing and food for a student participating in institutionally owned or operated food services or institutionally owned or operated housing. The total cost of all items described in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll) that are not billed to the student by the institution or otherwise required by the institution for enrollment, including such total cost disaggregated by the cost of each such item, including, as determined under such section— the component totals each for housing and food costs for students who reside off-campus or off campus with family; books, supplies, equipment, course materials, and rental or purchase of a personal computer; and transportation. The academic period covered by the Financial Aid Offer, and an explanation that the amount of financial aid offered may change— for academic periods not covered by the Financial Aid Offer; or by program. An indication of whether cost and aid estimates are based on full-time or part-time enrollment. An indication, as applicable, about whether the tuition and fees are estimated based on the previous year, or are set, for the academic period indicated in accordance with subparagraph (B). The aggregate amount of grants and scholarships, differentiated by source, that the student does not have to repay, such as grant aid offered under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) and grant aid offered through other Federal programs, grant and scholarship aid offered by the institution, grant and scholarship aid offered by the State, and, if known, grant and scholarship aid from an outside source to the student for such academic period, including— a disclosure that the grants and scholarships do not have to be repaid; and if institutional aid is included— the conditions under which the student can expect to receive similar amounts of such financial aid for each academic period the student is enrolled at the institution; and whether the institutional aid offer may change if grants or scholarships from outside sources are applied after the student receives the Financial Aid Offer, and, if applicable, how that aid will change. The net price that the student, or the student's family on behalf of the student, is estimated to have to pay for the student to attend the institution for such academic period, equal to— the cost of attendance as described in paragraph (1)(A) for the student for the period indicated in paragraph (1)(B); minus the amount of grant and scholarship aid described in paragraph (2) that is included in the Financial Aid Offer. A disclosure that the net price is an estimate of the total expenses for the year and not equivalent to the amount the student will owe directly to the institution. Information on any loan under part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et seq.; 20 U.S.C. 1087aa et seq.) (except a Federal Direct PLUS Loan under part D of that Act) that the institution recommends for the student for the academic period covered by the Financial Aid Offer, which shall be made— with clear use of the word loan to describe the recommended loan amounts; and with clear labeling of subsidized and unsubsidized loans. A disclosure that such loans have to be repaid and a disclosure that the student can borrow a lesser or, if applicable, greater amount than the recommended loan amount. A disclosure that the interest rates and fees on such loans are set annually and affect total cost over time, and a link to a Department of Education website that includes current information on interest rates and fees. A link to the Department of Education's repayment calculator website for students with instruction that this website contains customizable estimates of expected repayment costs under different loan repayment plans. The deadlines and a summary of the process (including the next steps) for— accepting the financial aid offered; adjusting the amount of financial aid offered; and declining the financial aid offered. Information on when and how costs described in paragraph (1)(A)(i) must be paid, including a clear indication of whether such cost is required or optional for the student. A disclosure that verification of information provided on the Free Application for Federal Student Aid may require the student to submit further documentation. Information about where a student or the student’s family can seek additional information regarding the financial aid offered, including contact information for the institution’s financial aid office and the Department of Education’s website on financial aid. Any other information the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Bureau of Consumer Financial Protection, determines necessary (based on the results of the consumer testing under subsection (g)(2)) so that students and parents can make informed loan borrowing decisions, which may include— the most recent cohort default rate, as defined in section 435(m) of the Higher Education Act of 1965 (20 U.S.C. 1085(m)), with respect to an institution where more than 30 percent of enrolled students borrow loans to pay for their education, and a comparison to the national average cohort default rate; the percentage of students at the institution who borrow student loans; the median loan debt at graduation for students at the institution (clearly marked as including only Federal loans if private loan data are not available to be included); and any additional calculations determined necessary for ensuring that students understand full college costs, financial aid gaps, and options for covering those gaps. The standard form developed under subsection (a) shall include, in addition to the information described in subsection (b), to be included on the Financial Aid Offer in a concise format determined by the Secretary of Education, in consultation with the heads of relevant Federal agencies and the individuals and entities described in subsection (a), the following information: At the institution’s discretion— additional options and potential resources for paying for the amount listed in subsection (b)(3), such as tuition payment plans and the terms and conditions of those plans; and a disclosure that Federal Direct PLUS Loans made under part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et seq.), private education loans, or other financing products may be available to cover remaining need, except that the institution— may not include an amount for such Federal Direct PLUS Loans, private education loans, or other financing products; and shall include a disclosure that such loans and agreements— are subject to an additional application process and have to be repaid by the borrower; and may not be eligible for all the benefits available for Federal Direct Stafford Loans or Federal Direct Unsubsidized Stafford Loans. The following information relating to private education loans and other financing products: A disclosure that students considering borrowing to cover the cost of attendance should consider available Federal student loans prior to applying for private education loans or other financing products, including an explanation that Federal student loans offer generally more favorable terms and beneficial repayment options than private education loans and other financing products. The impact of a proposed private education loan or other financing product on the student’s potential eligibility for other financial assistance, including Federal financial assistance under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.). A statement explaining the student’s ability to select a private educational lender or other financing product provider of the student’s choice. Information on work-study employment opportunities offered in accordance with part C of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087–51 et seq.), institutional work-study programs, or State work-study programs, including— the maximum annual amount the student may earn through the program; and a disclosure that any work-study amount offered may be— subject to the availability of qualified employment opportunities upon the student's enrollment; and disbursed over time as earned by the student. Each Financial Aid Offer shall meet the following requirements: Include, in addition to the requirements described in subsections (b) and (c), a concise summary, in plain language, of— the terms and conditions of financial aid recommended under paragraphs (2) and (4) of subsection (b) and subsection (c)(3), and a method to provide students with additional information about such terms and conditions, such as links to the supplementary information; and Federal, State, or institutional conditions required to receive and renew financial aid and a method to provide students with additional information about these conditions, such as links to the supplementary information. Clearly distinguish between the aid offered under paragraphs (2) and (4) of subsection (b) and subsection (c)(3), by including a subtotal for the aid offered in each of such paragraphs and by refraining from commingling the different types of aid described in such paragraphs. Use standard terminology and definitions, as described in subsection (e)(1) and use plain language where possible. If an institution’s recommended Federal student loan aid offered in subsection (b)(4) is less than the Federal maximum available to the student, the institution shall provide additional information on Federal student loans, including the types and amounts for which the student is eligible in an attached document or web page. Use the standard offer form described in subsection (e)(2). Include the standardized statement regarding the possible availability of Federal education benefits, as established by the Secretary in accordance with subsection (e)(3). Include a delivery confirmation for electronic Financial Aid Offers, except that receipt of the Financial Aid Offer shall not be considered an acceptance or rejection of aid by the student. With respect to dependent students, any reference to private education loans shall be accompanied by— information about the availability of, and terms and conditions associated with, Federal Direct PLUS Loans under section 455 of the Higher Education Act of 1965 (20 U.S.C. 1087e) for the student's parents regardless of family income; and a notification of the student’s increased eligibility for Federal student loans under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) if the student's parents are not able to borrow under the Federal Direct PLUS Loan program. Not later than 3 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Consumer Financial Protection Bureau, and the individuals and entities described in subsection (a), shall establish standard terminology and definitions for the terms described in subsection (b). The Secretary of Education shall develop multiple draft financial aid offer forms for consumer testing, carry out consumer testing for such forms, and establish a finalized standard financial aid offer form, in accordance with the process established under subsection (g) and the requirements of this section. The Secretary may develop separate financial aid offer forms for— undergraduate students and graduate students; and first-time students and returning students. The Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury, the Secretary of Veterans Affairs, the Secretary of Defense, and the Director of the Consumer Financial Protection Bureau, shall establish standard language notifying students that they may be eligible for education benefits (and where students can locate more information about such benefits) including benefits in accordance with each of the following: Chapter 30, 31, 32, 33, 34, or 35 of title 38, United States Code. Chapter 101, 105, 106A, 1606, 1607, or 1608 of title 10, United States Code. Section 1784a, 2005, or 2007 of title 10, United States Code. Nothing in this section shall preclude an institution from supplementing the Financial Aid Offer with additional information if such additional information utilizes the same standard terminology identified in subsection (e)(1) and does not misrepresent costs, financial aid offered, or net price. Nothing in this section shall preclude an institution from deleting a required item on a Financial Aid Offer if— the student is ineligible for such item; the institution does not participate in the program related to such item; or the cost of attendance item is not applicable to the student. Not later than 9 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, including the Secretary of the Treasury and the Director of the Consumer Financial Protection Bureau, and the individuals and entities described in subsection (a), shall design and produce multiple draft financial aid offer forms for consumer testing with postsecondary students or prospective students. In developing that form, the Secretary shall ensure— that the headings described in paragraphs (1) through (4) of subsection (b) are in the same font, appear in the same order, and are displayed prominently on the financial aid offer form, such that none of that information is inappropriately omitted or de-emphasized; that the other information required in subsection (b) appears in a standard format and design on the Financial Aid Offer; and that the institution may include a logo or brand alongside the title of the Financial Aid Offer. Not later than 9 months after the date of enactment of the Understanding the True Cost of College Act of 2025, the Secretary of Education, in consultation with the heads of relevant Federal agencies, shall establish a process to submit the financial aid offer form drafts developed under paragraph (1) for consumer testing among representatives of students (including low-income students, first-generation college students, adult students, veterans, servicemembers, and prospective students), students’ families (including low-income families, families with first-generation college students, and families with prospective students), institutions of higher education, secondary school and postsecondary counselors, and nonprofit consumer groups. During such consumer testing, the Secretary shall ensure that not less than 16 and not more than 24 eligible institutions use the draft forms developed under paragraph (1), including institutions— that reflect a proportionate representation (based on the total number of students enrolled in postsecondary education) of community colleges, for-profit institutions, 4-year public institutions, and 4-year private nonprofit institutions; and that reflect geographic diversity. The Secretary of Education shall ensure that the consumer testing under this paragraph lasts no longer than 8 months after the process for consumer testing is developed under subparagraph (A). The results of consumer testing under paragraph (2) shall be used in the final development of the financial aid offer form. Not later than 3 months after the date the consumer testing under paragraph (2) concludes, the Secretary of Education shall submit to Congress and publish on its website the final standard financial aid offer form and a report detailing the results of such testing, including whether the Secretary of Education added any additional items to the standard financial aid offer form pursuant to subsection (b)(6). The Secretary of Education may modify or remove the definitions, terms, formatting, or design of the financial aid offer form based on the results of consumer testing required under this subsection and before finalizing the form, or in subsequent consumer testing. The Secretary may also recommend additional changes to Congress.

3. Mandatory form Part B of title I of the Higher Education Act of 1965 (20 U.S.C. 1011 et seq.) is amended by adding at the end the following: Notwithstanding any other provision of law, each institution of higher education that receives Federal financial assistance under this Act shall— use the financial aid offer form developed under section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note) in providing paper, mobile-optimized offers, or other electronic offers to all students who apply for aid and are accepted at the institution; and use the standard terminology and definitions developed by the Secretary of Education under subsection (e)(1) of such section 484 for all communications from the institution related to Financial Aid Offers. The requirements under this section shall take effect at the start of the first award year after the Secretary of Education finalizes the standard terminology and form developed in accordance with section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note). Section 492 shall not apply with respect to regulations promulgated in accordance with this section. 124.Use of mandatory financial aid offer form and terms(a)In generalNotwithstanding any other provision of law, each institution of higher education that receives Federal financial assistance under this Act shall—(1)use the financial aid offer form developed under section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note) in providing paper, mobile-optimized offers, or other electronic offers to all students who apply for aid and are accepted at the institution; and(2)use the standard terminology and definitions developed by the Secretary of Education under subsection (e)(1) of such section 484 for all communications from the institution related to Financial Aid Offers.(b)Effective datesThe requirements under this section shall take effect at the start of the first award year after the Secretary of Education finalizes the standard terminology and form developed in accordance with section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note).(c)Administrative proceduresSection 492 shall not apply with respect to regulations promulgated in accordance with this section..

124. Use of mandatory financial aid offer form and terms Notwithstanding any other provision of law, each institution of higher education that receives Federal financial assistance under this Act shall— use the financial aid offer form developed under section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note) in providing paper, mobile-optimized offers, or other electronic offers to all students who apply for aid and are accepted at the institution; and use the standard terminology and definitions developed by the Secretary of Education under subsection (e)(1) of such section 484 for all communications from the institution related to Financial Aid Offers. The requirements under this section shall take effect at the start of the first award year after the Secretary of Education finalizes the standard terminology and form developed in accordance with section 484 of the Higher Education Opportunity Act (20 U.S.C. 1092 note). Section 492 shall not apply with respect to regulations promulgated in accordance with this section.