Sec. 4628. Income-based repayment plan
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Section 493C(b) of the Higher Education Act of 1965 ( 20 U.S.C. 1098e ) is amended— in paragraph (7)(B)— by striking or at the end of clause (iv); and by adding at the end the following: has made payments under the income-based repayment plan under section 493C(f); or has made payments under the fixed repayment plan described in section 493E; ; by amending paragraph
(8)to read as follows: a borrower who is repaying a loan made under part B or D pursuant to income-based repayment may elect, at any time, to terminate repayment pursuant to income-based repayment and repay such loan under the income-based repayment plan under section 493C(f) or the fixed repayment plan described in section 493E; ; in paragraph (9), by striking the period at the end and inserting ; and ; and by adding at the end the following: a borrower who is repaying a loan made, insured, or guaranteed under part B or D pursuant to this section may repay such loan in full at any time without penalty. . Section 493C(c) of the Higher Education Act of 1965 ( 20 U.S.C. 1098e(c) ) is amended— by striking The Secretary shall establish and inserting the following: The Secretary shall establish ; by striking The Secretary shall consider and inserting the following: The Secretary shall— consider ; and by striking 428C(b)(1)(E). and inserting the following: 428C(b)(1)(E); and beginning as soon as the Secretary determines practicable after the Secretary finalizes the procedures required under section 9004 of the College Affordability Act , but not later than 2 years after the date of enactment of such Act, carry out, with respect to borrowers of any covered loan (as defined in section 455(d)(10)), including such borrowers who select, or for whom the Secretary selects under paragraph (8)(C) or (9)(C) of subsection (d), or section 428(m)(1), the income-based repayment plan under subsection (f), procedures for income-based repayment plans under this section that are equivalent to the procedures carried out under section 455(e)(9) with respect to income contingent repayment plans. . Section 493C of the Higher Education Act of 1965 ( 20 U.S.C. 1098e ) is amended by adding at the end the following: The income-based repayment plan under this subsection shall be carried out in accordance with this section, except as otherwise specified in this subsection— with respect to any loan made under part D on or after July 1, 2021, if such borrower elects such income-based repayment plan for the loan; and with respect to any loan made, insured, or guaranteed under part B or D on or before June 30, 2021, if such borrower elects to repay the loan under such income-based repayment plan on or after July 1, 2021. Notwithstanding any other provision of this section, with respect to a loan described under paragraph (1), the following terms shall apply to the income-based repayment plan under this subsection: Notwithstanding subsection (a)(3)(B), the repayment amount under this subsection shall be an amount equal to 10 percent of the result obtained by calculating, on at least an annual basis, the amount by which the adjusted gross income of the borrower (subject to clause (ii)) exceeds the applicable percentage of the poverty line in accordance with clause (iii). Subject to subclause (II), in the case of a married borrower (regardless of tax filing status), clause
(i)shall be applied by substituting the adjusted gross income of the borrower and the borrower’s spouse for the adjusted gross income of the borrower . Subclause
(I)shall not be applicable to any borrower who is married and who certifies to the Secretary through a form approved by the Secretary that the borrower is— separated from the spouse of the borrower; or unable to reasonably access the income information the spouse of such borrower. For purposes of clause (i), the term applicable percentage means 250 percent of the poverty line applicable to the borrower's family size (as determined under section 673(2) of the Community Services Block Grant Act ( 42 U.S.C. 9902(2) ))— reduced by 10 percentage points for each $1,000 by which the borrower’s adjusted gross income (in the case of a single borrower) exceeds $80,000; and reduced by 10 percentage points for each $2,000 by which the borrower’s adjusted gross income (in the case of a married borrower (regardless of filing status)), exceeds $160,000. Subsection (b)(7)(B) shall apply by substituting 20 years for 25 years . A borrower of such a loan may elect, and remain enrolled in, the income-based repayment plan under this subsection regardless of— whether such borrower has a partial financial hardship; and the income level of the borrower. Notwithstanding subparagraph
(A)of subsection (b)(6), a borrower’s monthly payment— shall be equal to the repayment amount determined under subparagraph
(A)divided by 12; and may exceed the monthly repayment amount under a standard 10-year repayment plan or a fixed repayment plan described in section 493E. Subparagraph
(B)of subsection (b)(3) shall not apply. Subsection
(d)shall not apply. In the case of a Federal Direct Consolidation Loan made on or after the date of enactment of the College Affordability Act that is being repaid under this subsection, any monthly payment made pursuant to any repayment plan listed in subsection (b)(7)(B) on a loan for which the liability has been discharged by the proceeds of such consolidation loan shall be treated as a monthly payment under this subsection on the portion of such consolidation loan that is attributable to such discharged loan, except that in the case of a subsequent consolidation loan, for purposes of this clause— any monthly payment made on the first consolidation loan or any other loan for which the liability has been discharged by such subsequent consolidation loan shall be applicable; and any monthly payment made on a loan for which the liability has been discharged by such first consolidation loan shall not be applicable. A borrower described in paragraph (1)(B)— may— choose to continue repayment pursuant to the repayment plan in which the borrower is enrolled on June 30, 2021; or make a one-time election to— terminate repayment pursuant to the repayment plan described in clause
(i)and enter the income-based repayment plan under this subsection; or terminate repayment pursuant to the repayment plan described in clause
(i)and enter a fixed repayment plan described in section 493E; and who makes an election under subparagraph (A)(ii), shall not repay a loan described in paragraph (1)(B) under a repayment plan that is not an income-based repayment plan under this subsection or a fixed repayment plan described in section 493E. The Secretary shall develop and implement a process that is consistent with any procedures (including verification procedures) established under subsection (c), which enables a covered borrower of a loan made under part D who desires to elect to repay such loan under income-based repayment under this subsection to make such election through written, electronic, or verbal notice to the Secretary. In this paragraph, the term covered borrower means a borrower of a loan made under part D who— is enrolled in the fixed repayment plan under section 493E; or has not yet selected a repayment plan. In calculating the period of time during which a borrower of a loan that is refinanced under section 460A has made monthly payments for purposes of subsection (b)(7), the Secretary shall include each month in which a monthly payment was made for the original loan or the refinanced loan, if such monthly payment otherwise meet the requirements of this section. In calculating the period of time during which a borrower of a Federal Direct Refinanced Private Loan under section 460B has made monthly payments for purposes of subsection (b)(7), the Secretary shall include only payments— that are made after the date of the issuance of the Federal Direct Refinanced Private Loan; and that otherwise meet the requirements of this section. .
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