Preventing Financial Exploitation in Higher Education Act

HR 7831 targets institutions of higher education with endowments of $2.5 billion or more. It imposes new penalties on these institutions based on their students' loan repayment rates: for fiscal years 2024-2029, penalties range from 16% to 30% of outstanding loan balances if default rates exceed 7% or more, delinquency rates exceed 5%, or underpayment rates exceed 4%. The bill also adds a 25% tax on net investment income for these institutions if their average tuition exceeds an inflation-adjusted base amount. These provisions apply only to large endowment institutions, not all colleges, and require institutions to pay penalties directly to the Secretary of Education.