The chairman of a legislative committee says it’s time to send a message to the student loan industry.
Senator Tom Courtney, a Democrat from Burlington, has introduced a bill that forbids "kick-backs" for directing students and their parents to certain loan companies.
Courtney doubts the bill will be passed in these waning days of the 2007 Legislative session, but he promises the Legislative Oversight Committee — which he chairs — will review the issue over the summer and fall. "If we’re giving rebates to people to steer loans around, that’s money that could be saved in the interest for kids," Courtney says.
Courtney isn’t sure such "incentives" or kick-backs are being given in Iowa, but he says if they are, it’s time to put a stop to it. "I hope that…nothing’s going on, I really do, but it’s always good to put daylight on stuff," Courtney says.
Recently, some out-of-court settlements have been reached after complaints that some college and university financial aid officers and lenders were paid an incentive to direct students to a particular loan company.