Illinois Senate Bill Creates Special Rules for Industry Plagued by Federal Consumer Protection Violations
May 20, 2025 | WASHINGTON, D.C. — Illinois is poised to be the first state to enact legislation affirmatively permitting and creating special rules for Income Share Agreements (ISAs), a type of private student loan with a track record of violating state and federal consumer protections and financial regulations. The bill, SB 1537, has been pushed for years by Better Future Forward, the first ISA provider to be penalized by the federal Consumer Financial Protection Bureau for violating consumer protection laws. If passed, the legislation will amend both the state’s Student Loan Servicing Rights Act and the Consumer Installment Loan Act.
In response, Student Borrower Protection Center (SBPC) Legal Director Winston Berkman-Breen released the following statement:
“Income Share Agreements (ISAs) are dangerous loans peddled by profiteering lenders and schools that have trapped borrowers and their families into debts with exorbitant rates and predatory terms. Despite misleading industry representations—claiming ISAs are a safer, more affordable alternative to private student loans—numerous federal and state regulators found that ISAs are, in fact, just another type of private student loan.
“It is a shame that a state with a strong track record of protecting consumers like Illinois is the first to roll out new regulations in service of ISA providers, especially when the ISA industry has yet to demonstrate its ability to comply with the most basic consumer protections found in the federal Truth in Lending Act.
“Rather than green lighting the activities of companies like Better Future Forward, the state should be asking whether these companies have been operating in the state illegally. We urge policymakers in Springfield to defend existing consumer protections and lending laws and not bend those laws to accommodate predatory financial products.”
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About Student Borrower Protection Center
Student Borrower Protection Center (SBPC) is a nonprofit organization focused on eliminating the burden of student debt for millions of Americans. We engage in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance racial and economic justice.
Learn more at protectborrowers.org or follow SBPC on Twitter @theSBPC.