Sec. 2. Interest rate limitation on debt entered into during military service to consolidate or refinance student loans incurred before military service
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Subsection
(a)of section 207 of the Servicemembers Civil Relief Act ( 50 U.S.C. 3937 ) is amended— in paragraph (1), by inserting after on debt incurred before service ; Limitation to 6 percent by redesignating paragraphs
(2)and
(3)as paragraphs
(3)and (4), respectively; by inserting after paragraph
(1)the following new paragraph (2): An obligation or liability bearing interest at a rate in excess of 6 percent per year that is incurred by a servicemember, or the servicemember and the servicemember's spouse jointly, during military service to consolidate or refinance one or more student loans incurred by the servicemember before such military service shall not bear an interest at a rate in excess of 6 percent during the period of military service. ; in paragraph (3), as redesignated by paragraph
(2)of this subsection, by inserting or
(2)after paragraph
(1); and in paragraph (4), as so redesignated, by striking paragraph
(2)and inserting paragraph
(3). Subsection
(b)of such section is amended— in paragraph (1)(A), by striking the interest rate limitation in subsection
(a)and inserting an interest rate limitation in paragraph
(1)or
(2)of subsection
(a); and in paragraph (2)— in the paragraph heading, by striking and inserting effective as of date of order to active duty ; and effective date by inserting before the period at the end the following: in the case of an obligation or liability covered by subsection (a)(1), or as of the date the servicemember (or servicemember and spouse jointly) incurs the obligation or liability concerned under subsection (a)(2) . Subsection
(d)of such section is amended by adding at the end the following new paragraph: The term student loan means the following: A Federal student loan made, insured, or guaranteed under title IV of the Higher Education Act of 1965 ( 20 U.S.C. 1070 et seq.). A private student loan as that term is defined in section 140(a) of the Truth in Lending Act ( 15 U.S.C. 1650(a) ). .
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Sec. 2
Interest rate limitation on debt entered into during military service to consolidate or refinance student loans incurred before military service
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