PRIVATE EDUCATION LOANS-REPORT

Illinois General Assembly - Full Text of SB3106

Select Language

×

The Illinois General Assembly offers the Google Translate™ service for visitor convenience. In no way should it be considered accurate as to the translation of any content herein.

Visitors of the Illinois General Assembly website are encouraged to use other translation services available on the internet.

The English language version is always the official and authoritative version of this website.

NOTE: To return to the original English language version, select the "Show Original" button on the Google Translate™ menu bar at the top of the window.

Choose Language

English

Afrikaans

Albanian

Arabic

Armenian

Azerbaijani

Basque

Bengali

Bosnian

Catalan

Croatian

Czech

Danish

Dutch

Esperanto

Estonian

Filipino

Finnish

French

Galician

Georgian

German

Greek

Gujarati

Haitian Creole

Hausa

Hawaiian

Hebrew

Hindi

Hungarian

Icelandic

Indonesian

Interlingua

Interlingue

Inuktitut

Irish

Italian

Japanese

Javanese

Kannada

Khmer

Korean

Latin

Latvian

Lithuanian

Luxembourgish

Macedonian

Malagasy

Malayalam

Maltese

Maori

Marathi

Myanmar

Nepali

Norwegian

Odia

Pashto

Punjabi

Romanian

Russian

Samoan

Sango

Sanskrit

Sardinian

Sindhi

Sinhala

Slovak

Slovenian

Somali

Southern Sotho

Spanish

Sundanese

Swahili

Swedish

Tamil

Telugu

Thai

Tigrinya

Tonga

Turkish

Ukrainian

Urdu

Vietnamese

Welsh

Xhosa

Yiddish

Yoruba

Zulu

Powered by
Translate

Close

Illinois General Assembly

Top Navigation Bar

Translate

Learn

Select General Assembly

Search the 104th General Assembly

Enter search terms for legislation, members, committees, or schedules.

ILGA.GOV

LEGISLATION & LAWS

Bills & Resolutions

Public Acts

Illinois Compiled Statutes

Illinois Constitution

Search Legislation

Glossary

Guide

Reports & Inquiry

Legislative Reports

Special Reports

FTP Site

Legislator Lookup

Capitol Complex Phone Numbers

Rules & Regulations

Illinois Register

Administrative Rules

Senate

Members

Schedules

Committees

Request for Remote Testimony

Journals

Transcripts

Rules

Audio/Video

FOIA Information

Senate Employment Opportunities

Media Guidelines

House

Members

Schedules

Committees

Submit testimony for House Committees

Journals

Transcripts

Rules

Audio/Video

FOIA Information

House Employment Opportunities

Log In

Mobile Top Bar

Search the 104th General Assembly

Enter keywords to search the Illinois General Assembly website.

Full Text of SB3106

Home

Legislation

Full Text

SB3106 - 104th General Assembly

Bill Status

Full Text

Votes

Witness Slips

Select Menu

Bill Status

Full Text

Votes

Witness Slips

Printer Friendly Version

Introduced

Printer Friendly Version

Introduced

Open PDF

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3106

Introduced 1/29/2026, by Sen. Michael W. Halpin

SYNOPSIS AS INTRODUCED:

110 ILCS 983/5
110 ILCS 983/10

Amends the Know Before You Owe Private Education Loan Act. Provides
that the annual report to the Department of Financial and Professional
Regulation and the Student Loan Ombudsman shall include the total number
and dollar amount (instead of the volume) of private education loans made
annually by a private educational lender, the total number and dollar
amount (instead of the volume) of private education loans made annually at
institutions of higher education, the total number and dollar amount of
private education loans made annually with a cosigner, and the default
rate for the private education loans reported by the private educational
lender pursuant to specified provisions for the previous reporting period.
Effective immediately.
LRB104 17947 LNS 31384 b

A BILL FOR

SB3106
LRB104 17947 LNS 31384 b
1

AN ACT concerning education.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Know Before You Owe Private Education Loan
5
Act is amended by changing Sections 5 and 10 as follows:

6

(110 ILCS 983/5)
7

Sec. 5.
Definitions.
As used in this Act:
8

"Annual percentage rate" means the percentage rate
9
calculated according to the Federal Reserve Board's
10
methodology as set forth under Regulation Z, 12 CFR Part 1026.
11

"Cosigner" means any individual who is liable for the
12
obligation of another without compensation, regardless of how
13
the individual is designated in the contract or instrument
14
with respect to that obligation, including an obligation under
15
a private education loan extended to consolidate a borrower's
16
preexisting student loans. The term includes any individual
17
whose signature is requested, as a condition, to grant credit
18
or to forbear on collection. The term does not include a spouse
19
of an individual if the spouse's signature is needed solely to
20
perfect the security interest in a loan.
21

"Default amount" means the loan amount of each outstanding
22
loan at the time the loan is declared in default.
23

"Default rate" means the default amount required to be

SB3106
- 2 -
LRB104 17947 LNS 31384 b
1
reported during a reporting period divided by the loan amount
2
of all outstanding loans required to be reported at the
3
beginning of the reporting period.

4

"Educational expense" means any expense, in whole or in
5
part, expressly used to finance postsecondary education,
6
regardless of whether the debt incurred by a student to pay
7
that expense is owed to the provider of postsecondary
8
education whose school, program, or facility the student
9
attends.
10

"Income share agreement" means an agreement under which a
11
borrower commits to pay a percentage of his or her future
12
income in exchange for money, payments, or credits applied to
13
or on behalf of a borrower. An income share agreement
14
constitutes a loan and debt within the meaning of this Act.
15

"Income share agreement provider" means:
16

(1) a person that provides money, payments, or credits
17

to or on behalf of a borrower pursuant to the terms of an
18

income share agreement; or
19

(2) any other person engaged in the business of
20

soliciting, making, funding, or extending income share
21

agreements.
22

"Institution of higher education" includes, but is not
23
limited to, institutions falling under the Private Business
24
and Vocational Schools Act of 2012, the Private College Act,
25
and public institutions of higher education as defined in
26
Section 1 of the Board of Higher Education Act. "Institution

SB3106
- 3 -
LRB104 17947 LNS 31384 b
1
of higher education" also includes a person engaged in the
2
business of providing postsecondary education, via
3
correspondence, online, or in this State, to a person located
4
in this State, regardless of whether the person has obtained
5
authorization from the Illinois Board of Higher Education to
6
operate in this State or is accredited.
7

"Loan amount" means the total outstanding balance on each
8
loan owed by a borrower to a lender at any given time.

9

"Private educational lender" and "private education loan"
10
have the meanings ascribed to the terms in Section 140 of the
11
Truth in Lending Act (15 U.S.C. 1650). In addition, "private
12
educational lender" includes an income share agreement
13
provider and a student financing company and "private
14
education loan" includes an income share agreement and student
15
financing.
16

"Student financing company" means a person engaged in the
17
business of securing, making, or extending student financing.
18
"Student financing company" does not include the following
19
persons, only to the extent that State regulation is preempted
20
by federal law:
21

(1) a federally chartered bank, savings bank, savings
22

and loan association, or credit union;
23

(2) a wholly owned subsidiary of a federally chartered
24

bank or credit union; and
25

(3) an operating subsidiary where each owner of the
26

operating subsidiary is wholly owned by the same federally

SB3106
- 4 -
LRB104 17947 LNS 31384 b
1

chartered bank or credit union.
2

"Student financing" means an extension of credit that:
3

(1) is not made, insured, or guaranteed under Title IV
4

of the Higher Education Act of 1965 (20 U.S.C. 1070 et
5

seq.);
6

(2) is extended to a consumer expressly, in whole or
7

in part, for postsecondary educational expenses,
8

regardless of whether the extension of credit is provided
9

by the institution of higher education that the student
10

attends;
11

(3) does not include a private education loan;
12

(4) does not include an income share agreement; and
13

(5) does not include a loan that is secured by real
14

property or a dwelling.
15
(Source: P.A. 102-583, eff. 8-26-21; 103-748, eff. 8-2-24.)

16

(110 ILCS 983/10)
17

Sec. 10.
Institutional certification required.
18

(a) In general. Except as provided in subsection (b) of
19
this Section, before a private educational lender may disburse
20
any funds with respect to a private education loan described
21
in this Act, the private educational lender shall obtain from
22
the relevant institution of higher education where such loan
23
is to be used on the behalf of the borrower, such institution's
24
certification of:
25

(1) the enrollment status of the borrower;

SB3106
- 5 -
LRB104 17947 LNS 31384 b
1

(2) the borrower's cost of attendance at the
2

institution as determined by the institution under Title
3

IV, Part F, of the Higher Education Act of 1965 as amended;
4

and
5

(3) the difference between:
6

(A) such cost of attendance; and
7

(B) the borrower's estimated financial assistance,
8

including such assistance received under Title IV of
9

the Higher Education Act of 1965 (20 U.S.C. 1070 et
10

seq.) and other financial assistance known to the
11

institution, as applicable.
12

(b) Notwithstanding subsection (a), a private educational
13
lender may disburse funds with respect to a private education
14
loan described in this subsection without obtaining the
15
institution's certification if the institution fails to
16
provide the certification within 15 business days of the
17
private educational lender's request for the certification if
18
the private educational lender has received:
19

(1) notification of the institution's refusal to
20

certify the request; or
21

(2) notification that the institution has received the
22

request for certification and will need additional time to
23

comply with the certification request.
24

(c) Loans disbursed without certification. If a private
25
educational lender disburses funds without obtaining the
26
certification as described in subsection (b), the private

SB3106
- 6 -
LRB104 17947 LNS 31384 b
1
educational lender shall report the disbursement of the funds
2
in a manner determined by the Student Loan Ombudsman.
3

(d) Notification of loans disbursed without certification.
4
On or before the date a private educational lender issues any
5
funds with respect to a private education loan described in
6
this Section, the private educational lender shall notify the
7
relevant institution of higher education, in writing, of the
8
amount of the extension of credit and the borrower on whose
9
behalf credit is extended.
10

(e) Annual report. A private educational lender that
11
disburses funds with respect to a private education loan
12
described in this Section shall prepare and submit an annual
13
report to the Department of Financial and Professional
14
Regulation and the Student Loan Ombudsman containing the
15
required information about private education loans to be
16
determined by the Student Loan Ombudsman. Such a report shall
17
include, at a minimum, the following information about private
18
education loans described in this Section, including any
19
private education loans disbursed without certification:
20

(1)

(A)
a list of all institutions of higher education
21

at which a private educational lender disburses funds with
22

respect to a private education loan described in this
23

Section;
24

(2)

(B)
the
total number and dollar amount

volume
of
25

private education loans described in this Section made
26

annually by a private educational lender;

SB3106
- 7 -
LRB104 17947 LNS 31384 b
1

(3)

(C)
the
total number and dollar amount

volume
of
2

private education loans described in this Section made
3

annually at each school identified under paragraph
(1)

4

(A)
;
5

(4) the total number and dollar amount of private
6

education loans made annually with a cosigner;

7

(5)

(D)
the historical lifetime default rate for
8

borrowers obtaining a private education loan described in
9

this Section from the private educational lender;
and
10

(6) the default rate for the private education loans
11

reported by the private educational lender pursuant to
12

paragraph (3) for the previous reporting period under this
13

Act;
14

(7) the default rate for the private education loans
15

reported by the private educational lender pursuant to
16

paragraph (4) for the previous reporting period under this
17

Act; and

18

(8)

(E)
a copy of each model or template promissory
19

note, agreement, contract or other instrument used by a
20

private educational lender during the previous year to
21

substantiate that a private education loan described in
22

this Section has been extended to the borrower or that a
23

borrower owes a debt to the private educational lender.
24

(f) Annual report exemption. A private educational
25

lender that funds 10 or fewer new private education loans
26

in a calendar year shall be exempt from submitting the

SB3106
- 8 -
LRB104 17947 LNS 31384 b
1

annual report for that year. Any lender claiming this
2

exemption shall submit a statement to the Department of
3

Financial and Professional Regulation and the Student Loan
4

Ombudsman certifying the number of private education loans
5

made in that calendar year.
6
(Source: P.A. 102-583, eff. 8-26-21.)

7

Section 99.
Effective date.
This Act takes effect upon
8
becoming law.

Footer

Disclaimer

This site is maintained for the Illinois General Assembly by the
Legislative Information System, 705 Stratton Building, Springfield, Illinois 62706.

Contact ILGA Webmaster

ILGA.gov uses cookies to ensure you get the best experience on our website. By continuing to browse ILGA.gov you consent to our use of cookies.
Read About Cookies

ILGA.GOV

2026 ILGA.gov | All Rights Reserved |
ADA

|
Disclaimers
|
Learn

This site is maintained for the Illinois General Assembly by the
Legislative Information System, 705 Stratton Building, Springfield, Illinois 62706.
Contact ILGA Webmaster

ILGA.gov uses cookies to ensure you get the best experience on our website. By continuing to browse ILGA.gov you consent to our use of cookies.
Read About Cookies

ILGA.GOV

2026 ILGA.gov | All Rights Reserved |
ADA

|
Disclaimers
|
Learn