Last week, the Consumer Finance Protection Bureau (CFPB) issued new guidance that postsecondary institutions cannot withhold academic transcripts from students owing past due institutional loan payments. The action is part of a series of decisions aimed at regulating institutionally-based aid programs such as loans and Income Share Agreements, or ISAs.

This move protects some students with stranded credits, or credits students have earned but cannot document because of a past due balance. However, this only applies to students who are past due or have defaulted on an institutionally-financed loan. It does not apply broadly to all students who owe a past due balance to the institution.

In other words, if the institution acts as the lender, they can certainly pursue collections efforts against those loans, but those efforts cannot include transcript withholding.

In many respects, this action simply levels the playing field between students with institutional loans and students with loans from other sources, like federal or private loans. Just as federal and private student loan borrowers could miss loan payments and still access their transcripts, so too can institutional loan borrowers. The positive impacts of this action will likely be felt most acutely by students who attended for-profit colleges that acted as the lender for a students’ loan, such as the now-defunct ITT Tech.

Prohibiting holds is one way to address the pernicious problem of stranded credits—a roadblock that over 6.5 million students face. Another way to address transcript holds is to resolve the underlying balance. Addressing the root of the problem not only allows students access to their transcripts, but also gets them out from under inefficient and overly-punitive collections processes. States must (re)enroll adult students if they are to meet their attainment needs, which means providing unique support to students who have past due balances. In Ohio, Ithaka S+R is supporting eight institutions in piloting a program to do just that.

Addressing the underlying balances that result in holds also allows postsecondary institutions that operate student-centered, competitive institutional loan programs to continue doing so without fear of scrutiny. While very little research exists on institutionally-funded loan programs, practitioners know that some can actually serve students quite well. For example, some postsecondary institutions may offer loan programs as part of their endowed financial aid- programs that can carry lower fees and interest than federal loans, but are nonetheless offered as institutional loans. Some institutions may also offer programs specifically for students that cannot access federal financial aid, such as students without a documented immigration status.

Last week’s action by the CFPB is certainly a welcome one to support students who would like to access their transcripts for employment, transfer, or other opportunities. And, there’s still more work to be done to meet the unique needs of students with past due balances.