Outcomes-Based Financing (OBF) for Students Act

This bill creates federal rules for outcomes-based financing (OBF) products, such as income share agreements, in which students repay based on their future income instead of a fixed schedule. It sets tax treatment for borrowers and providers, requires specific disclosures and advertising rules, and sets limits such as a 20 percent cap on income committed to payments, an income threshold below which no payment is owed, and maximum payment counts and durations. It lets these debts be discharged in bankruptcy like ordinary loans, ends obligations upon death or permanent disability, and overrides certain state laws unless states pass laws that specifically reference this section. It also directs the Treasury to allow ongoing consent for providers to receive tax return information.

Full text and official record on Congress.gov

Sponsors

• Erin Houchin Republican sponsor
• 1 cosponsors