1. Short title This Act may be cited as the Protect Student Borrowers Act of 2017 . 2. Purpose The purpose of this Act is to protect student borrowers by requiring institutions of higher education to assume some of the risk of default for student loans under part D of title IV of the Higher Education Act of 1965 ( 20 U.S.C. 1087a et seq.). 3. Institutional rebates to the Department of Education for defaulted loans Section 454 of the Higher Education Act of 1964 ( 20 U.S.C. 1087d ) is amended— (1) in subsection (a)— (A) in paragraph (5), by striking and after the semicolon; (B) in paragraph (6), by striking the period at the end and inserting ; and ; and (C) by adding at the end the following: (7) provide that the institution accepts the institutional risk-sharing requirements under subsection (d), if applicable. ; and (2) by adding at the end the following: (d) Institutional risk-Sharing for student loan defaults (1) In general Subject to paragraph (3), each institution of higher education participating in the direct student loan program under this part for a fiscal year that has a rate of participation in such program for all students enrolled at that institution for such fiscal year that is 33 percent or higher shall remit, at such times as the Secretary may specify, a risk-sharing payment based on a percentage of the volume of student loans under this part that are in default, as determined under paragraph (2). (2) Determination of risk-sharing payments Subject to paragraph (3), with respect to each fiscal year, an institution of higher education described in paragraph (1) that has a cohort default rate (as defined in section 435(m))— (A) that is 30 percent or higher for the most recent fiscal year for which data are available, shall pay to the Secretary for the fiscal year an amount that is equal to 20 percent of the total amount (including interest and collection fees) of loans made under this part to students of such cohort that are in default