Informed Student Borrowing Act of 2023

HR 4616, the Informed Student Borrowing Act of 2023, requires federal student loan borrowers to manually choose their exact loan amount each academic year during financial aid counseling, rather than automatically receiving the full eligible amount. The bill mandates that schools provide specific, plain-language disclosures before loans are disbursed, including sample monthly repayment amounts (based on median debt and earnings data from the College Scorecard), median earnings for graduates of the institution, and completion rates. This applies to all borrowers taking out federal Direct Stafford, Unsubsidized, or PLUS loans (including parent borrowers), ensuring they understand repayment obligations and can opt to borrow less than their full eligibility. The goal is to improve transparency about long-term costs and outcomes before students commit to debt.