A bipartisan bill presented last week would add new railings around the income agreements, an alternative of student help that, until recently, had a limited federal supervision.

isa and consumer defenders have been asking for clarification about the legal rules that must be followed since the Department of Education clarified in March that ISAS are considered private loans for students. The announcement of the department submitted ISAS to the same set of consumer protection laws as private loans for students. However, since ISAs, which are based on the income of a student, are different from the loans of traditional private students, ISA suppliers have been confused on how to interpret these laws.

The ISA Student Protection Law would essentially create a regulatory system adapted to ISAS. The bill was presented by Senators Mark Warner, a Virginia Democrat; Todd Young, an Indiana Republican; Marco Rubio, Republican of Florida; and Chris Coons, a Delaware Democrat.

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“Income sharing agreements are a promising way to finance postsecundaria education and an attractive alternative to private loans and loans for students. ISA are also demonstrating to be exceptionally answered to the needs of students who are not eligible for federal help programs for existing federal students, "Warner said in a statement." There are students throughout the country who are already benefiting from Isa and deserve the safeguards and certainty that would provide the ISA Student Protection Law of 2022 ". that the bill will prevent bad actors from rising in the industry. Cover a portion or all the cost of assistance for the university. In return, the student pays a percentage of their postgraduate income for an organized period of time. They are more commonly offered in programs of technical training, training camps and for some universities that offer the programs themselves with institutional funds or in association with companies.

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ISAS supporters have argued that they are an alternative of financial aid that keeps university students outside the private market for student loans. On the other hand, critics argue that they can be predators and, in some cases, they can lead students to assume more debt than they would have through traditional loan programs.

“ISAS are a tool. They are just a tool, and can build problematic programs with any tool, "said Kevin James, executive director of Better Future Forward, a non -profit organization that offers ISA programs to students in Illinois, Minnesota and Wisconsin." Like any Tool, we need adequate regulatory supervision. I think we should be creating stronger consumption protections. ” They have been introduced in Congress since 2015. However, none, none has been signed in law. The bill in its current form is seen by the critics and supporters of ISA as one of the best versions of the bill, But Isa's skeptics do not believe that the bill will do enough. the loans?

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