Sec. 2. Refinancing programs
1,045 words·~5 min read·
/bill/115/hr/3346/ih/section-2A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Section 451(a) of the Higher Education Act of 1965 ( 20 U.S.C. 1087a(a) ) is amended— by striking and
(2)and inserting
(2); and by inserting ; and
(3)to make loans under section 460A after section 459A . Part D of title IV of the Higher Education Act of 1965 ( 20 U.S.C. 1087a et seq.) is amended by adding at the end the following: Beginning not later than 180 days after the date of enactment of the Student Opportunity Act, the Secretary shall establish a program under which the Secretary, upon the receipt of an application from a qualified borrower, reissues the borrower’s original loan under this part or part B as a loan under this part, in accordance with the provisions of this section, in order to permit the borrower to obtain the interest rate provided under subsection (c). Upon application of a qualified borrower, the Secretary shall reissue a Federal Direct Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, a Federal Direct PLUS Loan, or a Federal Direct Consolidation Loan of the qualified borrower, for which the first disbursement was made, or the application for the reissuance of a loan under this section was received before July 1, 2018, in an amount equal to the sum of— the unpaid principal, accrued unpaid interest, and late charges of the original loan; and the administrative fee under subsection (d)(3). Upon application of a qualified borrower for any loan that was made, insured, or guaranteed under part B and for which the first disbursement was made before July 1, 2010, the Secretary shall reissue such loan as a loan under this part, in an amount equal to the sum of the unpaid principal, accrued unpaid interest, and late charges of the original loan and the administrative fee under subsection (d)(3), to the borrower in accordance with the following: The Secretary shall pay the proceeds of such reissued loan to the eligible lender of the loan made, insured, or guaranteed under part B, in order to discharge the borrower from any remaining obligation to the lender with respect to the original loan. The Secretary shall reissue— a loan originally made, insured, or guaranteed under section 428 as a Federal Direct Stafford Loan; a loan originally made, insured, or guaranteed under section 428B as a Federal Direct PLUS Loan; a loan originally made, insured, or guaranteed under section 428H as a Federal Direct Unsubsidized Stafford Loan; and a loan originally made, insured, or guaranteed under section 428C as a Federal Direct Consolidation Loan. The interest rate for each loan reissued under this paragraph shall be the rate provided under subsection (c). The interest rate for the reissued Federal Direct Stafford Loans, Federal Direct Unsubsidized Stafford Loans, Federal Direct PLUS Loans, and Federal Direct Consolidation Loans, shall be a rate equal to— the high yield of the 10-year Treasury note auctioned at the final auction held prior to the first day of the month in which the application for reissuance under this section is received, plus .5 percent. The applicable rate of interest determined under paragraph
(1)for a reissued loan under this section shall be fixed for the period of the loan. A loan that is reissued under this section shall have the same terms and conditions as the original loan, except as otherwise provided in this section. Reissuing a loan under this section shall not result in the extension of the duration of the repayment period of the loan, and the borrower shall retain the same repayment term that was in effect on the original loan. Nothing in this paragraph shall be construed to prevent a borrower from electing a different repayment plan at any time in accordance with section 455(d)(3). The Secretary shall charge the borrower of a loan reissued under this section an administrative fee of not more than 0.5 percent of the sum of the unpaid principal, accrued unpaid interest, and late charges, of the original loan. The term qualified borrower means a borrower— of a loan under this part or part B for which the first disbursement was made, or the application for reissuance under this section was received, before July 1, 2018; and who meets the eligibility requirements based on income or debt-to-income ratio established by the Secretary. Not later than 180 days after the date of enactment of the Student Opportunity Act, the Secretary shall establish eligibility requirements based on income or debt-to-income ratio that take into consideration providing access to refinancing under this section for borrowers with the greatest financial need. The Secretary’s authority to reissue loans under this section shall expire on the date that is determined in accordance with the Student Opportunity Act. . Section 455(m) of the Higher Education Act of 1965 ( 20 U.S.C. 1087e(m) ) is amended— by redesignating paragraphs
(3)and
(4)as paragraphs
(4)and (5), respectively; by inserting after paragraph
(2)the following: Notwithstanding paragraph (1), in determining the number of monthly payments that meet the requirements of such paragraph for an eligible Federal Direct Loan reissued under section 460A that was originally a loan under this part, the Secretary shall include all monthly payments made on the original loan that meet the requirements of such paragraph. In the case of an eligible Federal Direct Loan reissued under section 460A that was originally a loan under part B, only monthly payments made after the date on which the loan was reissued may be included for purposes of paragraph (1). ; and in paragraph (4)(A) (as redesignated by paragraph
(1)of this subsection), by inserting (including any Federal Direct Stafford Loan, Federal Direct PLUS Loan, Federal Direct Unsubsidized Stafford Loan, or Federal Direct Consolidation Loan reissued under section 460A) before the period at the end. Section 493C of the Higher Education Act of 1965 ( 20 U.S.C. 1098e ) is amended by adding at the end the following: In calculating the period of time during which a borrower of a loan that is reissued under section 460A has made monthly payments for purposes of subsection (b)(7), the Secretary shall deem the period to include all monthly payments made for the original loan, and all monthly payments made for the reissued loan, that otherwise meet the requirements of this section. .
Connectionstraces to 3
Traces to 3 documents
Citation graph
cites case law
Cites 3Cited by 0 across 0 sources