Illinois HB2850 establishes rules for educational income share agreements, including payment caps, income exclusions, and consumer protections.
Illinois HB2850 creates an Article within the Student Loan Servicing Rights Act to regulate educational income share agreements (EISAs). EISAs are agreements where a provider credits money to a consumer, who then makes periodic payments based on their income. The bill mandates that EISA payments cannot exceed 8% of the consumer's income and sets a maximum effective annual percentage rate of 8.5%. It prohibits EISAs from including cosigners and limits the use of multiple agreements.
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