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Fair and Accurate Credit Transaction Act
Part B - § 1638
Transactions other than under an open end credit plan
(a) Required disclosures by creditor
For each consumer credit transaction other than under an open end credit plan, the creditor shall disclose each of the following items, to the extent applicable:
(1) The identity of the creditor required to make disclosure.
(2)
(3) The “finance charge”, not itemized, using that term.
(4) The finance charge expressed as an “annual percentage rate”, using that term. This shall not be required if the amount financed does not exceed $75 and the finance charge does not exceed $5, or if the amount financed exceeds $75 and the finance charge does not exceed $7.50.
(5) The sum of the amount financed and the finance charge, which shall be termed the “total of payments”.
(6) The number, amount, and due dates or period of payments scheduled to repay the total of payments.
(7) In a sale of property or services in which the seller is the creditor required to disclose pursuant to section 1631 (b) of this title, the “total sale price”, using that term, which shall be the total of the cash price of the property or services, additional charges, and the finance charge.
(8) Descriptive explanations of the terms “amount financed”, “finance charge”, “annual percentage rate”, “total of payments”, and “total sale price” as specified by the Board. The descriptive explanation of “total sale price” shall include reference to the amount of the downpayment.
(9) Where the credit is secured, a statement that a security interest has been taken in
(10) Any dollar charge or percentage amount which may be imposed by a creditor solely on account of a late payment, other than a deferral or extension charge.
(11) A statement indicating whether or not the consumer is entitled to a rebate of any finance charge upon refinancing or prepayment in full pursuant to acceleration or otherwise, if the obligation involves a precomputed finance charge. A statement indicating whether or not a penalty will be imposed in those same circumstances if the obligation involves a finance charge computed from time to time by application of a rate to the unpaid principal balance.
(12) A statement that the consumer should refer to the appropriate contract document for any information such document provides about nonpayment, default, the right to accelerate the maturity of the debt, and prepayment rebates and penalties.
(13) In any residential mortgage transaction, a statement indicating whether a subsequent purchaser or assignee of the consumer may assume the debt obligation on its original terms and conditions.
(14) In the case of any variable interest rate residential mortgage transaction, in disclosures provided at application as prescribed by the Board for a variable rate transaction secured by the consumer’s principal dwelling, at the option of the creditor, a statement that the periodic payments may increase or decrease substantially, and the maximum interest rate and payment for a $10,000 loan originated at a recent interest rate, as determined by the Board, assuming the maximum periodic increases in rates and payments under the program, or a historical example illustrating the effects of interest rate changes implemented according to the loan program.
(15) In the case of a consumer credit transaction that is secured by the principal dwelling of the consumer, in which the extension of credit may exceed the fair market value of the dwelling, a clear and conspicuous statement that—
(2)
(A) The “amount financed”, using that term, which shall be the amount of credit of which the consumer has actual use. This amount shall be computed as follows, but the computations need not be disclosed and shall not be disclosed with the disclosures conspicuously segregated in accordance with subsection (b)(1) of this section:
(i) take the principal amount of the loan or the cash price less downpayment and trade-in;
(ii) add any charges which are not part of the finance charge or of the principal amount of the loan and which are financed by the consumer, including the cost of any items excluded from the finance charge pursuant to section 1605 of this title; and
(iii) subtract any charges which are part of the finance charge but which will be paid by the consumer before or at the time of the consummation of the transaction, or have been withheld from the proceeds of the credit.
(ii) add any charges which are not part of the finance charge or of the principal amount of the loan and which are financed by the consumer, including the cost of any items excluded from the finance charge pursuant to section 1605 of this title; and
(iii) subtract any charges which are part of the finance charge but which will be paid by the consumer before or at the time of the consummation of the transaction, or have been withheld from the proceeds of the credit.
(B) In conjunction with the disclosure of the amount financed, a creditor shall provide a statement of the consumer’s right to obtain, upon a written request, a written itemization of the amount financed. The statement shall include spaces for a “yes” and “no” indication to be initialed by the consumer to indicate whether the consumer wants a written itemization of the amount financed. Upon receiving an affirmative indication, the creditor shall provide, at the time other disclosures are required to be furnished, a written itemization of the amount financed. For the purposes of this subparagraph, “itemization of the amount financed” means a disclosure of the following items, to the extent applicable:
(i) the amount that is or will be paid directly to the consumer;
(ii) the amount that is or will be credited to the consumer’s account to discharge obligations owed to the creditor;
(iii) each amount that is or will be paid to third persons by the creditor on the consumer’s behalf, together with an identification of or reference to the third person; and
(iv) the total amount of any charges described in the preceding subparagraph (A)(iii).
(ii) the amount that is or will be credited to the consumer’s account to discharge obligations owed to the creditor;
(iii) each amount that is or will be paid to third persons by the creditor on the consumer’s behalf, together with an identification of or reference to the third person; and
(iv) the total amount of any charges described in the preceding subparagraph (A)(iii).
(3) The “finance charge”, not itemized, using that term.
(4) The finance charge expressed as an “annual percentage rate”, using that term. This shall not be required if the amount financed does not exceed $75 and the finance charge does not exceed $5, or if the amount financed exceeds $75 and the finance charge does not exceed $7.50.
(5) The sum of the amount financed and the finance charge, which shall be termed the “total of payments”.
(6) The number, amount, and due dates or period of payments scheduled to repay the total of payments.
(7) In a sale of property or services in which the seller is the creditor required to disclose pursuant to section 1631 (b) of this title, the “total sale price”, using that term, which shall be the total of the cash price of the property or services, additional charges, and the finance charge.
(8) Descriptive explanations of the terms “amount financed”, “finance charge”, “annual percentage rate”, “total of payments”, and “total sale price” as specified by the Board. The descriptive explanation of “total sale price” shall include reference to the amount of the downpayment.
(9) Where the credit is secured, a statement that a security interest has been taken in
(A) the property which is purchased as part of the credit transaction, or
(B) property not purchased as part of the credit transaction identified by item or type.
(B) property not purchased as part of the credit transaction identified by item or type.
(10) Any dollar charge or percentage amount which may be imposed by a creditor solely on account of a late payment, other than a deferral or extension charge.
(11) A statement indicating whether or not the consumer is entitled to a rebate of any finance charge upon refinancing or prepayment in full pursuant to acceleration or otherwise, if the obligation involves a precomputed finance charge. A statement indicating whether or not a penalty will be imposed in those same circumstances if the obligation involves a finance charge computed from time to time by application of a rate to the unpaid principal balance.
(12) A statement that the consumer should refer to the appropriate contract document for any information such document provides about nonpayment, default, the right to accelerate the maturity of the debt, and prepayment rebates and penalties.
(13) In any residential mortgage transaction, a statement indicating whether a subsequent purchaser or assignee of the consumer may assume the debt obligation on its original terms and conditions.
(14) In the case of any variable interest rate residential mortgage transaction, in disclosures provided at application as prescribed by the Board for a variable rate transaction secured by the consumer’s principal dwelling, at the option of the creditor, a statement that the periodic payments may increase or decrease substantially, and the maximum interest rate and payment for a $10,000 loan originated at a recent interest rate, as determined by the Board, assuming the maximum periodic increases in rates and payments under the program, or a historical example illustrating the effects of interest rate changes implemented according to the loan program.
(15) In the case of a consumer credit transaction that is secured by the principal dwelling of the consumer, in which the extension of credit may exceed the fair market value of the dwelling, a clear and conspicuous statement that—
(A) the interest on the portion of the credit extension that is greater than the fair market value of the dwelling is not tax deductible for Federal income tax purposes; and
(B) the consumer should consult a tax adviser for further information regarding the deductibility of interest and charges.
(B) the consumer should consult a tax adviser for further information regarding the deductibility of interest and charges.
(b) Form and timing of disclosures; residential mortgage transaction requirements
(1) Except as otherwise provided in this part, the disclosures required under subsection (a) of this section shall be made before the credit is extended. Except for the disclosures required by subsection (a)(1) of this section, all disclosures required under subsection (a) of this section and any disclosure provided for in subsection (b), (c), or (d) of section 1605 of this title shall be conspicuously segregated from all other terms, data, or information provided in connection with a transaction, including any computations or itemization.
(2) In the case of a residential mortgage transaction, as defined in section 1602 (w) of this title, which is also subject to the Real Estate Settlement Procedures Act [12 U.S.C. 2601 et seq.], good faith estimates of the disclosures required under subsection (a) of this section shall be made in accordance with regulations of the Board under section 1631 (c) of this title before the credit is extended, or shall be delivered or placed in the mail not later than three business days after the creditor receives the consumer’s written application, which ever is earlier. If the disclosure statement furnished within three days of the written application contains an annual percentage rate which is subsequently rendered inaccurate within the meaning of section 1606 (c) of this title, the creditor shall furnish another statement at the time of settlement or consummation.
(3) In the case of a credit transaction described in paragraph (15) of subsection (a) of this section, disclosures required by that paragraph shall be made to the consumer at the time of application for such extension of credit.
(2) In the case of a residential mortgage transaction, as defined in section 1602 (w) of this title, which is also subject to the Real Estate Settlement Procedures Act [12 U.S.C. 2601 et seq.], good faith estimates of the disclosures required under subsection (a) of this section shall be made in accordance with regulations of the Board under section 1631 (c) of this title before the credit is extended, or shall be delivered or placed in the mail not later than three business days after the creditor receives the consumer’s written application, which ever is earlier. If the disclosure statement furnished within three days of the written application contains an annual percentage rate which is subsequently rendered inaccurate within the meaning of section 1606 (c) of this title, the creditor shall furnish another statement at the time of settlement or consummation.
(3) In the case of a credit transaction described in paragraph (15) of subsection (a) of this section, disclosures required by that paragraph shall be made to the consumer at the time of application for such extension of credit.
(c) Timing of disclosures on unsolicited mailed or telephone purchase orders or loan requests
(1) If a creditor receives a purchase order by mail or telephone without personal solicitation, and the cash price and the total sale price and the terms of financing, including the annual percentage rate, are set forth in the creditor’s catalog or other printed material distributed to the public, then the disclosures required under subsection (a) of this section may be made at any time not later than the date the first payment is due.
(2) If a creditor receives a request for a loan by mail or telephone without personal solicitation and the terms of financing, including the annual percentage rate for representative amounts of credit, are set forth in the creditor’s printed material distributed to the public, or in the contract of loan or other printed material delivered to the obligor, then the disclosures required under subsection (a) of this section may be made at any time not later than the date the first payment is due.
(2) If a creditor receives a request for a loan by mail or telephone without personal solicitation and the terms of financing, including the annual percentage rate for representative amounts of credit, are set forth in the creditor’s printed material distributed to the public, or in the contract of loan or other printed material delivered to the obligor, then the disclosures required under subsection (a) of this section may be made at any time not later than the date the first payment is due.
(d) Timing of disclosure in cases of an addition of a deferred payment price to an existing outstanding balance
If a consumer credit sale is one of a series of consumer credit sales transactions made pursuant to an agreement providing for the addition of the deferred payment price of that sale to an existing outstanding balance, and the person to whom the credit is extended has approved in writing both the annual percentage rate or rates and the method of computing the finance charge or charges, and the creditor retains no security interest in any property as to which he has received payments aggregating the amount of the sales price including any finance charges attributable thereto, then the disclosure required under subsection (a) of this section for the particular sale may be made at any time not later than the date the first payment for that sale is due. For the purposes of this subsection, in the case of items purchased on different dates, the first purchased shall be deemed first paid for, and in the case of items purchased on the same date, the lowest price shall be deemed first paid for.
(e) Terms and disclosure with respect to private education loans
(1) Disclosures required in private education loan applications and solicitations
In any application for a private education loan, or a solicitation for a private education loan without requiring an application, the private educational lender shall disclose to the borrower, clearly and conspicuously—
(2) Disclosures at the time of private education loan approval
Contemporaneously with the approval of a private education loan application, and before the loan transaction is consummated, the private educational lender shall disclose to the borrower, clearly and conspicuously—
(3) Self-certification of information
(4) Disclosures at the time of private education loan consummation
Contemporaneously with the consummation of a private education loan, a private educational lender shall make to the borrower each of the disclosures described in—
(5) Format of disclosures
(6) Effective period of approved rate of interest and loan terms
(7) Right to cancel
With respect to a private education loan, the borrower may cancel the loan, without penalty to the borrower, at any time within 3 business days of the date on which the loan is consummated, and the private educational lender shall disclose such right to the borrower in accordance with paragraph (4).
(8) Prohibition on disbursement
No funds may be disbursed with respect to a private education loan until the expiration of the 3-day period described in paragraph (7).
(9) Board regulations
In issuing regulations under this subsection, the Board shall prevent, to the extent possible, duplicative disclosure requirements for private educational lenders that are otherwise required to make disclosures under this subchapter, except that in any case in which the disclosure requirements of this subsection differ or conflict with the disclosure requirements of any other provision of this subchapter, the requirements of this subsection shall be controlling.
(10) Definitions
For purposes of this subsection, the terms “covered educational institution”, “private educational lender”, and “private education loan” have the same meanings as in section 1650 of this title.
(11) Duties of lenders participating in preferred lender arrangements
Each private educational lender that has a preferred lender arrangement with a covered educational institution shall annually, by a date determined by the Board, in consultation with the Secretary of Education, provide to the covered educational institution such information as the Board determines to include in the model form developed under paragraph (5) for each type of private education loan that the lender plans to offer to students attending the covered educational institution, or to the families of such students, for the next award year (as that term is defined in section 481 of the Higher Education Act of 1965 [20 U.S.C. 1088]).
In any application for a private education loan, or a solicitation for a private education loan without requiring an application, the private educational lender shall disclose to the borrower, clearly and conspicuously—
(A) the potential range of rates of interest applicable to the private education loan;
(B) whether the rate of interest applicable to the private education loan is fixed or variable;
(C) limitations on interest rate adjustments, both in terms of frequency and amount, or the lack thereof, if applicable;
(D) requirements for a co-borrower, including any changes in the applicable interest rates without a co-borrower;
(E) potential finance charges, late fees, penalties, and adjustments to principal, based on defaults or late payments of the borrower;
(F) fees or range of fees applicable to the private education loan;
(G) the term of the private education loan;
(H) whether interest will accrue while the student to whom the private education loan relates is enrolled at a covered educational institution;
(I) payment deferral options;
(J) general eligibility criteria for the private education loan;
(K) an example of the total cost of the private education loan over the life of the loan—
(B) whether the rate of interest applicable to the private education loan is fixed or variable;
(C) limitations on interest rate adjustments, both in terms of frequency and amount, or the lack thereof, if applicable;
(D) requirements for a co-borrower, including any changes in the applicable interest rates without a co-borrower;
(E) potential finance charges, late fees, penalties, and adjustments to principal, based on defaults or late payments of the borrower;
(F) fees or range of fees applicable to the private education loan;
(G) the term of the private education loan;
(H) whether interest will accrue while the student to whom the private education loan relates is enrolled at a covered educational institution;
(I) payment deferral options;
(J) general eligibility criteria for the private education loan;
(K) an example of the total cost of the private education loan over the life of the loan—
(i) which shall be calculated using the principal amount and the maximum rate of interest actually offered by the private educational lender; and
(ii) calculated both with and without capitalization of interest, if an option exists for postponing interest payments;
(ii) calculated both with and without capitalization of interest, if an option exists for postponing interest payments;
(L) that a covered educational institution may have school-specific education loan benefits and terms not detailed on the disclosure form;
(M) that the borrower may qualify for Federal student financial assistance through a program under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) [and 42 U.S.C. 2751 et seq.], in lieu of, or in addition to, a loan from a non-Federal source;
(N) the interest rates available with respect to such Federal student financial assistance through a program under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) [and 42 U.S.C. 2751 et seq.];
(O) that, as provided in paragraph (6)—
(M) that the borrower may qualify for Federal student financial assistance through a program under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) [and 42 U.S.C. 2751 et seq.], in lieu of, or in addition to, a loan from a non-Federal source;
(N) the interest rates available with respect to such Federal student financial assistance through a program under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) [and 42 U.S.C. 2751 et seq.];
(O) that, as provided in paragraph (6)—
(i) the borrower shall have the right to accept the terms of the loan and consummate the transaction at any time within 30 calendar days (or such longer period as the private educational lender may provide) following the date on which the application for the private education loan is approved and the borrower receives the disclosure documents required under this subsection for the loan; and
(ii) except for changes based on adjustments to the index used for a loan, the rates and terms of the loan may not be changed by the private educational lender during the period described in clause (i);
(ii) except for changes based on adjustments to the index used for a loan, the rates and terms of the loan may not be changed by the private educational lender during the period described in clause (i);
(P) that, before a private education loan may be consummated, the borrower must obtain from the relevant institution of higher education the form required under paragraph (3), and complete, sign, and return such form to the private educational lender;
(Q) that the consumer may obtain additional information concerning such Federal student financial assistance from their institution of higher education, or at the website of the Department of Education; and
(R) such other information as the Board shall prescribe, by rule, as necessary or appropriate for consumers to make informed borrowing decisions.
(Q) that the consumer may obtain additional information concerning such Federal student financial assistance from their institution of higher education, or at the website of the Department of Education; and
(R) such other information as the Board shall prescribe, by rule, as necessary or appropriate for consumers to make informed borrowing decisions.
(2) Disclosures at the time of private education loan approval
Contemporaneously with the approval of a private education loan application, and before the loan transaction is consummated, the private educational lender shall disclose to the borrower, clearly and conspicuously—
(A) the applicable rate of interest in effect on the date of approval;
(B) whether the rate of interest applicable to the private education loan is fixed or variable;
(C) limitations on interest rate adjustments, both in terms of frequency and amount, or the lack thereof, if applicable;
(D) the initial approved principal amount;
(E) applicable finance charges, late fees, penalties, and adjustments to principal, based on borrower defaults or late payments, including limitations on the discharge of a private education loan in bankruptcy;
(F) fees or range of fees applicable to the private education loan;
(G) the maximum term under the private education loan program;
(H) an estimate of the total amount for repayment, at both the interest rate in effect on the date of approval and at the maximum possible rate of interest offered by the private educational lender and applicable to the borrower, to the extent that such maximum rate may be determined, or if not, a good faith estimate thereof;
(I) any principal and interest payments required while the student for whom the private education loan is intended is enrolled at a covered educational institution and unpaid interest that will accrue during such enrollment;
(J) payment deferral options applicable to the borrower;
(K) whether monthly payments are graduated;
(L) that, as provided in paragraph (6)—
(B) whether the rate of interest applicable to the private education loan is fixed or variable;
(C) limitations on interest rate adjustments, both in terms of frequency and amount, or the lack thereof, if applicable;
(D) the initial approved principal amount;
(E) applicable finance charges, late fees, penalties, and adjustments to principal, based on borrower defaults or late payments, including limitations on the discharge of a private education loan in bankruptcy;
(F) fees or range of fees applicable to the private education loan;
(G) the maximum term under the private education loan program;
(H) an estimate of the total amount for repayment, at both the interest rate in effect on the date of approval and at the maximum possible rate of interest offered by the private educational lender and applicable to the borrower, to the extent that such maximum rate may be determined, or if not, a good faith estimate thereof;
(I) any principal and interest payments required while the student for whom the private education loan is intended is enrolled at a covered educational institution and unpaid interest that will accrue during such enrollment;
(J) payment deferral options applicable to the borrower;
(K) whether monthly payments are graduated;
(L) that, as provided in paragraph (6)—
(i) the borrower shall have the right to accept the terms of the loan and consummate the transaction at any time within 30 calendar days (or such longer period as the private educational lender may provide) following the date on which the application for the private education loan is approved and the borrower receives the disclosure documents required under this subsection for the loan; and
(ii) except for changes based on adjustments to the index used for a loan, the rates and terms of the loan may not be changed by the private educational lender during the period described in clause (i);
(ii) except for changes based on adjustments to the index used for a loan, the rates and terms of the loan may not be changed by the private educational lender during the period described in clause (i);
(M) that the borrower—
(i) may qualify for Federal financial assistance through a program under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) [and 42 U.S.C. 2751 et seq.], in lieu of, or in addition to, a loan from a non-Federal source; and
(ii) may obtain additional information concerning such assistance from their institution of higher education or the website of the Department of Education;
(ii) may obtain additional information concerning such assistance from their institution of higher education or the website of the Department of Education;
(N) the interest rates available with respect to such Federal financial assistance through a program under title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) [and 42 U.S.C. 2751 et seq.];
(O) the maximum monthly payment, calculated using the maximum rate of interest actually offered by the private educational lender and applicable to the borrower, to the extent that such maximum rate may be determined, or if not, a good faith estimate thereof; and
(P) such other information as the Board shall prescribe, by rule, as necessary or appropriate for consumers to make informed borrowing decisions.
(O) the maximum monthly payment, calculated using the maximum rate of interest actually offered by the private educational lender and applicable to the borrower, to the extent that such maximum rate may be determined, or if not, a good faith estimate thereof; and
(P) such other information as the Board shall prescribe, by rule, as necessary or appropriate for consumers to make informed borrowing decisions.
(3) Self-certification of information
(A) In general
Before a private educational lender may consummate a private education loan with respect to a student attending an institution of higher education, the lender shall obtain from the applicant for the private education loan the form developed by the Secretary of Education under section 155 of the Higher Education Act of 1965 [20 U.S.C. 1019d], signed by the applicant, in written or electronic form.
(B) Rule of construction
No other provision of this subsection shall be construed to require a private educational lender to perform any additional duty under this paragraph, other than collecting the form required under subparagraph (A).
Before a private educational lender may consummate a private education loan with respect to a student attending an institution of higher education, the lender shall obtain from the applicant for the private education loan the form developed by the Secretary of Education under section 155 of the Higher Education Act of 1965 [20 U.S.C. 1019d], signed by the applicant, in written or electronic form.
(B) Rule of construction
No other provision of this subsection shall be construed to require a private educational lender to perform any additional duty under this paragraph, other than collecting the form required under subparagraph (A).
(4) Disclosures at the time of private education loan consummation
Contemporaneously with the consummation of a private education loan, a private educational lender shall make to the borrower each of the disclosures described in—
(A) paragraph (2)(A) (adjusted, as necessary, for the rate of interest in effect on the date of consummation, based on the index used for the loan);
(B) subparagraphs (B) through (K) and (M) through (P) of paragraph (2); and
(C) paragraph (7).
(B) subparagraphs (B) through (K) and (M) through (P) of paragraph (2); and
(C) paragraph (7).
(5) Format of disclosures
(A) Model form
Not later than 2 years after August 14, 2008, the Board shall, based on consumer testing, and in consultation with the Secretary of Education, develop and issue model forms that may be used, at the option of the private educational lender, for the provision of disclosures required under this subsection.
(B) Format
Model forms developed under this paragraph shall—
Not later than 2 years after August 14, 2008, the Board shall, based on consumer testing, and in consultation with the Secretary of Education, develop and issue model forms that may be used, at the option of the private educational lender, for the provision of disclosures required under this subsection.
(B) Format
Model forms developed under this paragraph shall—
(i) be comprehensible to borrowers, with a clear format and design;
(ii) provide for clear and conspicuous disclosures;
(iii) enable borrowers easily to identify material terms of the loan and to compare such terms among private education loans; and
(iv) be succinct, and use an easily readable type font.
(ii) provide for clear and conspicuous disclosures;
(iii) enable borrowers easily to identify material terms of the loan and to compare such terms among private education loans; and
(iv) be succinct, and use an easily readable type font.
(C) Safe harbor
Any private educational lender that elects to provide a model form developed under this subsection that accurately reflects the practices of the private educational lender shall be deemed to be in compliance with the disclosures required under this subsection.
Any private educational lender that elects to provide a model form developed under this subsection that accurately reflects the practices of the private educational lender shall be deemed to be in compliance with the disclosures required under this subsection.
(6) Effective period of approved rate of interest and loan terms
(A) In general
With respect to a private education loan, the borrower shall have the right to accept the terms of the loan and consummate the transaction at any time within 30 calendar days (or such longer period as the private educational lender may provide) following the date on which the application for the private education loan is approved and the borrower receives the disclosure documents required under this subsection for the loan, and the rates and terms of the loan may not be changed by the private educational lender during that period.
(B) Prohibition on changes
Except for changes based on adjustments to the index used for a loan, the rates and terms of the loan may not be changed by the private educational lender prior to the earlier of—
With respect to a private education loan, the borrower shall have the right to accept the terms of the loan and consummate the transaction at any time within 30 calendar days (or such longer period as the private educational lender may provide) following the date on which the application for the private education loan is approved and the borrower receives the disclosure documents required under this subsection for the loan, and the rates and terms of the loan may not be changed by the private educational lender during that period.
(B) Prohibition on changes
Except for changes based on adjustments to the index used for a loan, the rates and terms of the loan may not be changed by the private educational lender prior to the earlier of—
(i) the date of acceptance of the terms of the loan and consummation of the transaction by the borrower, as described in subparagraph (A); or
(ii) the expiration of the period described in subparagraph (A).
(ii) the expiration of the period described in subparagraph (A).
(7) Right to cancel
With respect to a private education loan, the borrower may cancel the loan, without penalty to the borrower, at any time within 3 business days of the date on which the loan is consummated, and the private educational lender shall disclose such right to the borrower in accordance with paragraph (4).
(8) Prohibition on disbursement
No funds may be disbursed with respect to a private education loan until the expiration of the 3-day period described in paragraph (7).
(9) Board regulations
In issuing regulations under this subsection, the Board shall prevent, to the extent possible, duplicative disclosure requirements for private educational lenders that are otherwise required to make disclosures under this subchapter, except that in any case in which the disclosure requirements of this subsection differ or conflict with the disclosure requirements of any other provision of this subchapter, the requirements of this subsection shall be controlling.
(10) Definitions
For purposes of this subsection, the terms “covered educational institution”, “private educational lender”, and “private education loan” have the same meanings as in section 1650 of this title.
(11) Duties of lenders participating in preferred lender arrangements
Each private educational lender that has a preferred lender arrangement with a covered educational institution shall annually, by a date determined by the Board, in consultation with the Secretary of Education, provide to the covered educational institution such information as the Board determines to include in the model form developed under paragraph (5) for each type of private education loan that the lender plans to offer to students attending the covered educational institution, or to the families of such students, for the next award year (as that term is defined in section 481 of the Higher Education Act of 1965 [20 U.S.C. 1088]).