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Code · BILL · 114th Congress · H.R. 5962 (Introduced in House) — To amend the Higher Education Act of 1965 to provide for the automatic recertification of income for income-driven re... · Sec. 2

Sec. 2. Notification procedures for borrowers who are delinquent on loans

1,096 words·~5 min read·/bill/114/hr/5962/ih/section-2·

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Section 455(d) of the Higher Education Act of 1965 ( 20 U.S.C. 1087e(d) ) is amended by adding at the end the following: The Secretary may obtain such information as is reasonably necessary regarding the income and family size of a borrower described in this paragraph (and the borrower’s spouse, if applicable). Returns and return information (as defined in section 6103 of the Internal Revenue Code of 1986) may be obtained under this subparagraph only to the extent authorized by section 6103(l)(13) of such Code, except that nothing in this subparagraph or such Code shall be construed to authorize the Secretary to obtain such returns and return information for a borrower who is not at least 60 days delinquent on a loan made under this part.
The Secretary shall establish procedures as are necessary to effectively implement this paragraph. With respect to each borrower of a loan made under this part who is 60 days delinquent on such loan, the Secretary shall, at a minimum and as soon as practicable after such 60-day delinquency, provide to the borrower the following: Notification that the borrower is at least 60 days delinquent on the loan, including a description of the loan. A description of the repayment plans under which the borrower is eligible to repay the loan.
Clear and simple instructions on how to select the repayment plans described in clause
(ii)for the loan. If the income information of the borrower is available to the Secretary under subparagraph (A), based on such income information, the amount of the monthly payments under each such repayment plan for the loan. An explanation that in the case of a borrower for whom adjusted gross income is unavailable or does not reasonably reflect the borrower’s current income— if the borrower selects to repay such loan pursuant to an income-driven repayment plan that defines discretionary income in such a manner that an individual not required under section 6012(a)(1) of the Internal Revenue Code of 1986 to file a return with respect to income taxes imposed by subtitle A of such Code may have a calculated monthly payment greater than $0, the borrower will be required to provide the Secretary with other documentation of income satisfactory to the Secretary, which documentation the Secretary may use to determine an appropriate repayment schedule; or if the borrower selects to repay such loan pursuant to an income-driven repayment plan that is not described in subclause (I), the borrower will not be required to provide the Secretary with such other documentation of income, and the borrower will have a calculated monthly payment of $0. An explanation that the Secretary shall take the actions under subparagraph
(D)with respect to such borrower if the borrower is 120 days delinquent on the loan and has not selected a new repayment plan for the loan. Instructions on updating the information of the borrower obtained under subparagraph (A). With respect to each borrower of a loan made under this part who does not select a new repayment plan for the loan in accordance with the notice received under subparagraph (B), and who is 120 days delinquent on the loan, the Secretary, as soon as practicable after such 120-day delinquency, shall— in a case in which the loan is eligible for an income-driven repayment plan— provide the borrower with the income-driven repayment plan for which the loan is eligible and which requires the lowest monthly payment amount for such loan, compared to the other such plans for which the loan is eligible, or if the loan is eligible for more than one income-driven repayment plan that has the same such lowest monthly payment amount, provide the borrower with such income-driven repayment plan that has the most favorable terms for the borrower; if the plan described in subclause
(I)is not the income-driven plan that would have the lowest monthly payment amount for the loan if the loan were eligible for such plan, notify the borrower of the actions, if any, the borrower may take for such loan to become eligible for such income-driven repayment plan; and authorize the borrower to change the Secretary’s selection of a plan under this clause to any plan described in paragraph
(1)for which the borrower is eligible; and in a case in which the loan is ineligible for an income-driven repayment plan, the Secretary shall notify the borrower of any actions, if any, the borrower may take for such loan to become eligible for such a plan. With respect to each borrower of a loan made under this part who selects a new repayment plan in accordance with the notice received under subparagraph (B), and who continues to be delinquent on such loan for a period after such selection that the Secretary determines is sufficient to indicate that the borrower may benefit from repaying such loan under a new repayment plan, but such period is not less than a 60-day period, the Secretary, as soon as practicable after such period, shall carry out the procedures under this paragraph for such loan. The Secretary shall authorize a borrower to opt-out of the procedures under this paragraph. . Section 455(d) of the Higher Education Act of 1965 ( 20 U.S.C. 1087e(d) ) is further amended by adding at the end the following: In this section, the term income-driven repayment plan means a plan described in subparagraph
(D)or
(E)of paragraph (1). . Section 493C of the Higher Education Act of 1965 ( 20 U.S.C. 1098e ) is amended by adding at the end the following: A borrower changing from income-based repayment under this section to a different repayment plan shall not be required to pay the one monthly payment under the standard repayment plan described in section 682.215(d)(3) or 685.221(d)(2) of title 34, Code of Federal Regulations (or successor regulations) or any other amount. . The amendments made by paragraphs
(1)and
(2)of subsection
(a)shall— take effect as soon as practicable after the Secretary of Education finalizes the procedures under section 4 of this Act, but not later than 2 years after the date of enactment of such Act; and apply with respect to any loan made under part D of title IV of the Higher Education Act of 1965 ( 20 U.S.C. 1087a et seq. ) to a new borrower (defined in section 103 of the Higher Education Act of 1965 ( 20 U.S.C. 1003 )) on or after the date on which such amendments take effect. The amendment made by subsection (a)(3) shall take effect on the date of enactment of this Act.
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Sec. 2
Notification procedures for borrowers who are delinquent on loans
U.S.C.§ 1087e
U.S.C.§ 1098e
U.S.C.§ 1087a
U.S.C.§ 1003
Cites 4Cited by 0 across 0 sources
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