This is part of a paper series exploring the role that consumer protection laws play in safeguarding borrowers from the harms posed by ISAs. Authored by legal experts at the forefront of consumer law, the papers look at how ISAs fit into the existing consumer financial protection framework, highlighting a strong legal foundation for policymakers and regulators as they seek to oversee these products and protect students.
This paper surveys state consumer finance and consumer protection laws to examine their application to Income Share Agreements (ISAs). From origination to servicing to collections, a framework to protect borrowers with ISAs already exists at the state level, despite contrary claims by the ISA industry.
Because ISAs are subject to state laws regulating consumer loans, a wide variety of state laws apply to ISA providers, servicers, and collectors, as well as the schools through which they are offered. These include laws pertaining to licensing and oversight, usury limits, and prohibitions against unfair and deceptive acts or practices.
Read the Blog: The Role of States in Protecting Students in the ISA Market