Sec. 101. Income-based repayment plan
1,238 words·~6 min read·
/bill/116/s/1002/is/section-101A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Section 493C ( 20 U.S.C. 1098e ) is amended— in subsection (b)— by striking and inserting the following: Income-Based repayment program authorized.— ; Income-Based repayment program for borrowers who enter income-Based repayment before July 1, 2020.— in paragraph (3)(A), by striking except that and all that follows through section 435(o) ; and in paragraph (8), by striking the standard repayment plan; and inserting the fixed repayment plan under section 493E; ; and by striking subsection
(c)and inserting the following: Notwithstanding any other provision of this section, the provisions of this subsection shall apply— with respect to any loan made, insured, or guaranteed under part B or D on or after July 1, 2020, for which the borrower elects the income-based repayment plan under this section; and with respect to any loan made, insured, or guaranteed under part B or D before July 1, 2020, if such borrower elects to repay the loan under the income-based repayment plan on or after July 1, 2020, in accordance with paragraph
(3)and section 428(b)(1)(D)(ii) or 455(d)(7), as applicable. With respect to a loan described in paragraph (1), the following terms shall apply to the income-based repayment plan carried out under this section: Notwithstanding subsection (a)(3)(B), (b), or (e)— the annual 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 borrower's, and the borrower's spouse's (if applicable), adjusted gross income; exceeds the applicable percentage of the poverty line in accordance with clause
(ii)that is 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) ); and a borrower's monthly payment shall be determined in accordance with subclause
(I)divided by 12, which amount may exceed the monthly repayment amount under a standard 10-year repayment plan or a fixed repayment plan described in section 493E. For purposes of clause (i), the term applicable percentage means 250 percent reduced by 5 percentage points for each $1,000 by which the borrower's adjusted gross income exceeds $120,000. Notwithstanding subsection (e)(2), subsection (b)(7)(B) shall be applied by substituting 20 years for 25 years . Notwithstanding subparagraph
(A)of subsection (b)(6), a borrower of such a loan shall not be required to have a partial financial hardship and may elect, and remain enrolled in, the income-based repayment plan under this section regardless of income level, with the repayment amount calculated under subparagraph (A). Notwithstanding subsection (b), a borrower of an excepted PLUS loan or excepted consolidation loan may elect the income-based repayment plan under this subsection for the excepted PLUS loan or excepted consolidation loan, and the Secretary shall treat such loan for purposes only of the repayment terms as a Federal Direct PLUS Loan issued to a student borrower. The Secretary may issue rules and regulations, as the Secretary determines necessary, regarding the treatment of excepted PLUS loans or excepted consolidation loans that are to be repaid under an income-based repayment plan under this subsection. A borrower of a loan made, insured, or guaranteed under part B or D who enrolled in the income-based repayment plan under subsection (b), as such plan was in effect on July 1, 2020, may choose to retain such repayment plan or elect to enter an income-based repayment plan under this subsection or a fixed repayment plan described in section 493E, as provided in section 428(b)(1)(D)(ii) or 455(d)(7) (as applicable). Notwithstanding any other provision of this Act, if a borrower's monthly payment for a loan under an income-based repayment plan under this subsection is insufficient to pay the accrued interest on the borrower's loan for such month— in the case of a subsidized loan (including the portion of a consolidated loan that is a subsidized loan), any interest due and not paid under subsection (b)(2) on the subsidized loan for that month shall be paid or forgiven by the Secretary, except that a borrower of a subsidized loan shall only receive the benefits of this subparagraph for such loan for 36 months of payments under the income-based repayment plan, excluding any period of pause payment under section 460B; and in the case of an unsubsidized loan or a subsidized loan that no longer qualifies under subparagraph (A), 50 percent of the interest not covered by the borrower's monthly payment shall be paid or forgiven by the Secretary and the amount of the remaining interest shall be added to the balance of interest due on the loan, but shall not be capitalized. A borrower of a loan made under this part may elect to repay such loan under the income-based repayment plan under this subsection by providing written, electronic, or verbal notice to the Secretary of the borrower's desire to make such election, subject to subparagraph (C). The estimated monthly payment amount under this section for a loan for a borrower who makes an election described in subparagraph
(A)shall be immediately calculated using the income and family size information provided through the borrower’s written, electronic, or verbal statement. The information described in clause
(i)shall be verified by the Secretary not later than 90 days after the date the borrower states such income and family size information. If the Secretary is unable to verify the information by the end of the 90-day period, the borrower’s payment after such 90-day period will be the amount applicable under the fixed repayment plan under section 493E. Upon verification by the Secretary under clause (ii), the Secretary shall adjust the estimated monthly payment described in clause
(i)based on the verified income and family size information of the borrower, if necessary. Any adjusted monthly payment shall take effect beginning with the payment due not less than 60 days after the Secretary notifies the borrower of the adjusted amount. The Secretary shall consider any payments made prior to the adjusted monthly payment as having satisfied the amount due to qualify toward loan cancellation or forgiveness options under this title. The Secretary shall permit a borrower to make an election of income-based repayment in the written, electronic, or verbal manner described in subparagraph
(A)only in connection with the first instance of each of the following: The borrower's selection of a repayment plan during the grace period for such loan. The borrower changing from the fixed repayment plan under section 493E to income-based repayment. The borrower's failure to complete the verification process described in subparagraph (B)(ii). The borrower's failure to recertify enrollment in income-based repayment under this subsection. . Subsection
(d)of section 493C ( 20 U.S.C. 1098e(d) ) is amended to read as follows: The Secretary shall calculate the adjusted gross income of a married borrower under this section— in the case of a married borrower and spouse who jointly file a Federal income tax return, based on the adjusted gross income of the borrower and spouse as reported on the Federal income tax return; and in the case of a married borrower who files a Federal income tax return separately from the borrower's spouse, based on the sum of the adjusted gross income of the borrower and the spouse, as reported on the applicable Federal income tax returns, unless the borrower certifies, on a form approved by the Secretary, that the borrower is— separated from the borrower's spouse; or unable to reasonably access the income information of the borrower's spouse. .
Connectionstraces to 2
Traces to 2 documents
Citation graph
cites case law
Cites 2Cited by 0 across 0 sources