N.Y. Education Law 626 – Loan disclosure and prohibition of quid pro quo high risk loans
§ 626. Loan disclosure and prohibition of quid pro quo high risk loans. 1. Should a borrower or potential borrower consult a covered institution's financial aid office in connection with obtaining an educational loan to pay for or finance higher education expenses, the covered institution shall inform the borrower or potential borrower of all available financing options under Title IV of the Federal Higher Education Act of nineteen hundred sixty-five, as amended, including information on any terms and conditions of available loans under such title that are more favorable to the borrower, before a lending institution may provide a private educational loan to a borrower attending a covered institution.
Terms Used In N.Y. Education Law 626
- Borrower: shall mean a student attending a covered institution in this state, or a parent or person in parental relation to such student, who also obtains an educational loan from a lending institution to pay for or finance higher education expenses. See N.Y. Education Law 620
- Covered institution: shall mean any college, vocational institution, or approved program as defined in section six hundred one of this title. See N.Y. Education Law 620
- Educational loan: shall mean any loan that is made, insured, or guaranteed under Part B of Title IV of the Federal Higher Education Act of nineteen hundred sixty-five, as amended, any high risk loan or any private loan issued by a lending institution for the purposes of paying for or financing higher education expenses. See N.Y. Education Law 620
- High risk loans: shall mean any agreement between a lending institution and a covered institution that provides for the lending institution to provide loans to students with a poor or no credit history, who would otherwise not be eligible for educational loans. See N.Y. Education Law 620
- Higher education expenses: shall include the following:
a. See N.Y. Education Law 620 - Lending institution: shall mean :
a. See N.Y. Education Law 620
2. A lending institution shall not enter into an agreement or otherwise provide any high risk loans, in exchange for the covered institution providing concessions or promises to the lending institution that may prejudice other borrowers or potential borrowers.
3. A covered institution shall not enter into an agreement or otherwise provide any high risk loans, in exchange for the covered institution providing concessions or promises to the lending institution that may prejudice other borrowers or potential borrowers.