Financial aid offers

(a) In general 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: 124. Financial aid offers (a) Institutional requirements (1) In general Beginning on July 1, 2029, an institution of higher education that receives Federal financial assistance under this Act— (A) shall— (i) for all financial aid offers (including paper, or mobile-optimized or other electronic offers), include the information (including terminology) listed in subsection (c), and meet the requirements of paragraphs (1) and (2) of subsection (d), in compliance with the requirements published pursuant to subsection (b)(2); (ii) provide the supplemental content and disclosures described in paragraph (2); and (iii) for all communications from the institution related to financial aid offers (including the supplemental content and disclosures described in paragraph (2)), use the terminology referenced in subsection (c) in a consistent manner; and (B) in the case of an electronic financial aid offer that includes a requirement that a student confirm receipt of such offer, may not consider such confirmation an acceptance or rejection of such offer. (2) Supplemental content and disclosures Each institution of higher education described in paragraph (1) shall provide, in supplemental documents or through easily accessible weblinks to links on the institution’s portal or a website, the following: (A) The renewability requirements and conditions under which the student can expect to receive similar amounts of financial aid that is included in the student’s financial aid offer receive, for each award year the student is enrolled at the institution. institution, similar amounts of financial aid. (B) Whether the financial aid offer may change if aid from outside sources is applied after the student receives the initial financial aid offer, and, if applicable, how that financial aid offer will change. (C) If loans made under part D of title IV or other education loans offered through Federal programs are included, included— (i) a disclosure that the interest rates and fees on such loans are set annually and affect total cost over time, time; (ii) a link to any website that includes current information on interest rates and fees, fees; and (iii) a disclosure that such loans have to be repaid and the student can borrow an amount less than the offered loan amount. (D) A link to the College Financing Plan website of the Department (or the a successor website). (3) Omission of information An institution of higher education may omit information listed in subsection (c) or paragraph (2) of this subsection from a financial aid offer or supplemental document provided to a student, respectively, if the information— (A) relates to aid— (i) for which the student is ineligible; or (ii) is provided through a program with which the institution does not participate; or (B) is otherwise inapplicable to the student. (b) Secretarial requirements (1) Requirements for institutions of higher education (A) Consumer testing The Secretary shall— (i) in consultation with the heads of relevant Federal agencies, not later than 9 months after the date of enactment of the College Financial Aid Clarity Act of 2025, establish a process for consumer testing, with the representatives described in subparagraph (B), requirements for institutions of higher education on formatting financial aid offers to include the information (including terminology) listed in subsection (c), and to meet the requirements of paragraphs (1) and (2) of subsection (d), in a manner that is simple and understandable for students and the students’ families; and (ii) not later than 8 months after the process for consumer testing is established pursuant to clause (i), conduct and conclude such consumer testing. (B) Representatives The representatives described in this subparagraph are 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, nonprofit organizations (including scholarship-granting organizations), private lenders, and States. (C) Nonapplication of paperwork reduction act Subchapter I of chapter 35 of title 44, United States Code, shall not apply to the consumer testing process under this subsection. (2) Publication and notice Not later than July 1, 2028, the Secretary shall— (A) publish the requirements developed pursuant to paragraph (1)(A) on a publicly available website; and (B) notify each institution of higher education that receives Federal financial assistance under this Act of such best practices requirements and the requirements of subsection (a). (3) Sample of financial aid offers Not later than July 1, 2029, and every other year thereafter, the Secretary shall, in a manner consistent with applicable Federal privacy statutes— (A) collect a random representative sample of financial aid offers made by institutions for the most recent award year; and (B) review such offers for compliance with the requirements of subsection (a)(1)(A)(i). (c) Information required To comply with subsection (a), an institution of higher education shall include the following information in any financial aid offer that is made by the institution: (1) Information for the award year covered by the offer (A) Award year information The program of study and the award year of such program of study covered by the financial aid offer, and an explanation that the amount of financial aid offered may differ— (i) for academic periods not covered by the financial aid offer, such as a summer term or future award year; and (ii) by program of study. (B) Annual cost information Information on the student’s estimated cost of attendance for the award year covered by the financial aid offer, including the following: (i) The required costs for such award year, including the academic workload used to determined such required costs. (ii) The cost of attendance for such award year. (iii) An indication, as applicable, about whether any of the items used to calculate the required costs included in clause (i) which are subject to change are— (I) estimated based on the previous year; or (II) set for the award year covered by the financial aid offer. (C) Annual Grants and scholarships The amount of grant and scholarship aid for the award year covered by the financial aid offer. (D) Annual net price of attendance (i) Annual net price for completion The annual net price for completion for the award year covered by the financial aid offer, and a disclosure that such amount is an estimate. (ii) Annual net price of attendance The annual net price of attendance for the award year covered by the financial aid offer. (ii) Disclosure A offer, and a disclosure that the total and annual net price of attendance of the student such amount— (I) includes costs that are not required costs costs; and (II) is an estimate. (E) Loans Information on each loan for which the student is eligible for the award year covered by the offer (including any loan disbursed by the institution, and any other loan (such as a institutional, Federal, State, or private loan)), loan), including— (i) with respect to each such loan— (I) the total amount of each type of loan offered to the student; (ii) for each loan, (II) any applicable interest rate, including any capitalization of information on circumstances in which interest may be capitalized on the loan, and any applicable fees (including origination fees and additional costs); (iii) if applicable, and (III) information on any applicable loan repayment plan assistance offered by the institution; and (iv) (ii) a disclosure that the interest rates and fees on such loans can affect total cost over time, and time; (iii) a disclosure that such loans have to be repaid repaid; and (iv) a disclosure that the student can borrow an amount less than the recommended offered loan amount. (2) Grants and scholarships for the program length The amount of grant and scholarship aid for the program length of the student’s program of study. study for which the financial aid offer is provided. (3) Student employment Information on work-study employment opportunities (including work-study programs under part C of title IV, institutional work-study programs, or State work-study programs), including— (A) the maximum annual amount the student may earn through such an employment opportunity; and (B) a disclosure that any amounts received pursuant to such an employment opportunity may be— (i) subject to the availability of qualified employment opportunities upon enrollment; and (ii) disbursed over time as earned by the student. (4) Net price calculator A link to the universal net price calculator website described in section 132(c)(4). (5) Cost information Average costs for the most recent award year (A) Average annual net price required In general With respect to a program of study for completion Average annual net price required for completion which the financial aid offer is provided— (i) for the most recent award year for which data is available— (I) the program of study. (B) Total average annual net price required for completion The completion; and (II) the average annual price of attendance; and (ii) with respect to students who completed a credential for the program of study during the most recent award year— (I) the average total net price required for completion based on the time to credential for the program of study (as determined based on study; and (II) the most recent award year). (C) Average annual price of attendance Average annual price of attendance for the most recent award year for the program of study. (D) Total average annual net price of attendance The average annual total net price of attendance based on the time to credential for the program of study (as determined based on the most recent award year) (E) study. (B) Disclosure A disclosure that the information provided in this paragraph subparagraph (A) is based on the required costs and amounts of grant and scholarship aid applicable to other students for the most recent award year, and such information may not be applicable to the student receiving the financial aid offer. (6) Process for accepting, adjusting, or declining aid and next steps (A) Deadlines The deadlines and a summary of the process (including the next steps) for— (i) accepting the financial aid offered; (ii) adjusting the amount of aid offered; and (iii) declining the aid offered. (B) Payment Information on when and how costs described in paragraph (1)(A) (1)(B) must be paid. (C) Disclosure A disclosure that verification of information provided on the Free Application for Federal Student Aid may require the student to submit further documentation. (D) Financial aid information 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 a link to the Department of Education’s website on student financial aid. aid website. (E) College costs and student outcome information Information about where a student or a student’s family can seek additional information on college costs and student outcomes, including a link to the Department of Education’s College Scorecard website (or a successor website) and how to use such website to compare information from institutions of higher education regarding such costs and outcomes. (d) Format requirements (1) In general To comply with subsection (a), any financial aid offer made by an institution of higher education shall be titled Financial Aid Offer, use plain language wherever possible, and format the information listed in subsection (c) in accordance with paragraph (2). (2) Format of required information The information listed in subsection (c) shall be formatted in a financial aid offer made by an institution of higher education as follows: (A) The information required in subparagraphs (A) through (E) of subsection (c)(1) is listed in such order, under separate headings, and in the same font. (B) There is a clear distinction between the required costs and any other costs of attendance included in such financial aid offer. (C) There is a clear distinction between the aid offered under subparagraphs (C) and (E) of subsection (c)(1), including— (i) by not combining the different types of aid described in such paragraphs; and (ii) in such subparagraph (E)— (I) by using the word loan to clearly describe the recommended loan amounts; and (II) by clearly distinguishing between subsidized and unsubsidized loans. (D) The terminology referenced in subsection (c) is used in a consistent manner. (E) Such information is listed— (i) in a manner that ensures none of the information is inappropriately omitted or deemphasized; and (ii) in a consistent format for all financial aid offers made by such institution. (e) Definitions In this section: (1) Required costs The term required costs means the sum of all the items listed in section 472(a) that are required by an institution of higher education for a program of study for the program length of a program of study, for the time to credential for a student, or for an award year of a program of study, as applicable, including— (A) the tuition and fees normally assessed a student enrolled in such program of study carrying the same academic workload, as determined by the institution; and (B) in a case in which the institution requires a student to reside in institutionally owned or operated housing or to use institutionally owned or operated food services, the applicable standard allowance for such housing or food services determined by the institution in accordance with section 472(a)(5). (2) Amount of grant and scholarship aid The term amount of grant and scholarship aid means the sum of all of the grant and scholarship aid that is available to the student for the program length of a program of study, for the time to credential for a student, or for an award year of a program of study, as applicable, that a student does not have to repay, including need-based, merit-based, or athletic-based, or another type of grant and scholarship aid, that is— (A) offered under title IV; (B) offered through other Federal programs; (C) offered by the institution; (D) offered by a State; or (E) offered by any other source. (3) Net price required for completion (A) Net price determinations (i) Total net price required for completion The term total net price required for completion means, with respect to a student in a program of study— (I) (i) the required costs charged to such student for the program of study for the time to credential; minus (II) (ii) the amount of grant and scholarship aid that is available to the student for such program for the time to credential. (ii) (B) Annual net price required for completion The term annual net price required for completion means, with respect to a student in a program of study— (I) (i) the required costs charged to such student for the program of study for an award year; minus (II) (ii) the amount of grant and scholarship aid that is available to the student for such program for such award year. (4) Net price required for completion (A) Net price determinations (i) Total net price required for completion The term total net price required for completion means, with respect to a student in a program of study— (I) the required costs charged to such student for the program of study for the time to credential; minus (II) the amount of grant and scholarship aid that is available to the student for such program for the time to credential. (ii) Annual net price required for completion The term annual net price required for completion means, with respect to a student in a program of study— (I) the required costs charged to such student for the program of study for an award year; minus (II) the amount of grant and scholarship aid that is available to the student for such program for such award year. (5) Net price of attendance (A) Total net price of attendance The term total net price of attendance means, with respect to a student in a program of study, the sum of— (i) the total net price required for completion; and (ii) the sum, for the program length time to credential of the program of study, of all the costs listed in section 472(a) that are not required costs. (B) Annual net price of attendance The term annual net price of attendance means, with respect to a student in a program of study, the sum of the annual net price of attendance required for a specific completion for an award year of and the program of study, determined by disaggregating the total net price of attendance costs listed in section 472(a) that are not required costs for the student by each year of expected enrollment for the program length of the program of study. (6) such award year. (5) Program of study (A) In general The term program of study — (i) means an eligible program at an institution of higher education that is classified by a combination of— (I) one or more CIP codes; and (II) one credential level, determined by the credential awarded upon completion of the program; and (ii) does not include a program of study abroad. (B) Cip code The term CIP code means the six-digit taxonomic identification code assigned by an institution of higher education to a specific program of study at the institution, determined by the institution of higher education in accordance with the Classification of Instructional Programs published by the National Center for Education Statistics. (C) Credential level (i) In general The term credential level means the level of the degree or other credential awarded by an institution of higher education to students who complete a program of study of the institution. Each degree or other credential awarded by an institution shall be categorized by the institution as either undergraduate credential level or graduate credential level. (ii) Undergraduate credential When used with respect to a credential or credential level, the term undergraduate credential includes credentials such as an undergraduate certificate, an associate degree, a bachelor’s degree, and a post-baccalaureate certificate (including the coursework specified in paragraphs (3)(B) and (4)(B) of section 484(b)). (iii) Graduate credential When used with respect to a credential or credential level, the term graduate credential includes credentials such as a master’s degree, a doctoral degree, a professional degree (as defined under section 668.2 of title 34, Code of Federal Regulations), and a postgraduate certificate. (7) (6) Program length The term program length means the minimum amount of time in weeks, months, or years that is specified in the catalog, marketing materials, or other official publications of an institution of higher education for a full-time student to complete the requirements to obtain the degree or credential awarded for a specific program of study. (8) (7) Time to credential The term ‘time to credential’ means, with respect to a student, the actual amount of time in weeks, months, or years it takes the student to complete the requirements to obtain the degree or credential awarded for a specific program of study. (9) (8) Cost of attendance The term cost of attendance has the meaning given such term in section 472.. (b) Program participation agreement Section 487 487(a) of the Higher Education Act of 1965 (20 U.S.C. 1094(a)) is amended by adding at the end the following: (30) The institution will comply with the requirements of section 124(a).. (c) Cost of attendance of a program of study DDRamey: This amendment is also included in net price. (1) Determination of cost of attendance of a program of study (A) In general Section 472(a) of the Higher Education Act of 1965 (20 U.S.C. 1087ll(a)) is amended— (i) (A) in paragraph (1), by striking carrying the same academic workload and inserting enrolled in the same program of study and carrying the same academic workload; (ii) (B) in paragraph (2), by striking same course of study and inserting same program of study; and (iii) (C) in paragraph (14), by striking program and inserting program of study. (2) Disclosure Section 472(c) of the Higher Education Act of 1965 (20 U.S.C. 1087ll(c)) is amended— (A) by inserting of each program of study at the institution after cost of attendance; and (B) by striking of the institution and inserting of such programs of study at the institution.