 
      CHAPTER 28--HIGHER EDUCATION RESOURCES AND STUDENT ASSISTANCE
 
                    SUBCHAPTER IV--STUDENT ASSISTANCE
 
           Part C--William D. Ford Federal Direct Loan Program
 
Sec. 1087e. Terms and conditions of loans


(a) In general

        (1) Parallel terms, conditions, benefits, and amounts

        Unless otherwise specified in this part, loans made to borrowers 
    under this part shall have the same terms, conditions, and benefits, 
    and be available in the same amounts, as loans made to borrowers 
    under sections 1078, 1078-2, and 1078-8 of this title.

                      (2) Designation of loans

        Loans made to borrowers under this part that, except as 
    otherwise specified in this part, have the same terms, conditions, 
    and benefits as loans made to borrowers under--
            (A) section 1078 of this title shall be known as ``Federal 
        Direct Stafford Loans'';
            (B) section 1078-2 of this title shall be known as ``Federal 
        Direct PLUS Loans''; and
            (C) section 1078-8 of this title shall be known as ``Federal 
        Direct Unsubsidized Stafford Loans''.

(b) Interest rate

                    (1) Rates for FDSL and FDUSL

        For Federal Direct Stafford Loans and Federal Direct 
    Unsubsidized Stafford Loans for which the first disbursement is made 
    on or after July 1, 1994, the applicable rate of interest shall, 
    during any 12-month period beginning on July 1 and ending on June 
    30, be determined on the preceding June 1 and be equal to--
            (A) the bond equivalent rate of 91-day Treasury bills 
        auctioned at the final auction held prior to such June 1; plus
            (B) 3.1 percent,

    except that such rate shall not exceed 8.25 percent.

                (2) In school and grace period rules

        (A) Notwithstanding the provisions of paragraph (1), but subject 
    to paragraph (3), with respect to any Federal Direct Stafford Loan 
    or Federal Direct Unsubsidized Stafford Loan for which the first 
    disbursement is made on or after July 1, 1995, the applicable rate 
    of interest for interest which accrues--
            (i) prior to the beginning of the repayment period of the 
        loan; or
            (ii) during the period in which principal need not be paid 
        (whether or not such principal is in fact paid) by reason of a 
        provision described in section 1078(b)(1)(M) or 1077(a)(2)(C) of 
        this title,

    shall not exceed the rate determined under subparagraph (B).
        (B) For the purpose of subparagraph (A), the rate determined 
    under this subparagraph shall, during any 12-month period beginning 
    on July 1 and ending on June 30, be determined on the preceding June 
    1 and be equal to--
            (i) the bond equivalent rate of 91-day Treasury bills 
        auctioned at the final auction prior to such June 1; plus
            (ii) 2.5 percent,

    except that such rate shall not exceed 8.25 percent.

                          (3) Out-year rule

        Notwithstanding paragraphs (1) and (2), for Federal Direct 
    Stafford Loans and Federal Direct Unsubsidized Stafford Loans made 
    on or after July 1, 1998, the applicable rate of interest shall, 
    during any 12-month period beginning on July 1 and ending on June 
    30, be determined on the preceding June 1 and be equal to--
            (A) the bond equivalent rate of the security with a 
        comparable maturity as established by the Secretary; plus
            (B) 1.0 percent,

    except that such rate shall not exceed 8.25 percent.

                        (4) Rates for FDPLUS

        (A)(i) For Federal Direct PLUS Loans for which the first 
    disbursement is made on or after July 1, 1994, the applicable rate 
    of interest shall, during any 12-month period beginning on July 1 
    and ending on or before June 30, 2001, be determined on the 
    preceding June 1 and be equal to--
            (I) the bond equivalent rate of 52-week Treasury bills 
        auctioned at final auction held prior to such June 1; plus
            (II) 3.1 percent,

    except that such rate shall not exceed 9 percent.
        (ii) For any 12-month period beginning on July 1 of 2001 or any 
    succeeding year, the applicable rate of interest determined under 
    this subparagraph shall be determined on the preceding June 26 and 
    be equal to--
            (I) the weekly average 1-year constant maturity Treasury 
        yield, as published by the Board of Governors of the Federal 
        Reserve System, for the last calendar week ending on or before 
        such June 26; plus
            (II) 3.1 percent,

    except that such rate shall not exceed 9 percent.
        (B) For Federal Direct PLUS loans made on or after July 1, 1998, 
    the applicable rate of interest shall, during any 12-month period 
    beginning on July 1 and ending on June 30, be determined on the 
    preceding June 1 and be equal to--
            (i) the bond equivalent rate of the security with a 
        comparable maturity as established by the Secretary; plus
            (ii) 2.1 percent,

    except that such rate shall not exceed 9 percent.

                (5) Temporary interest rate provision

        (A) Rates for FDSL and FDUSL

            Notwithstanding the preceding paragraphs of this subsection, 
        for Federal Direct Stafford Loans and Federal Direct 
        Unsubsidized Stafford Loans for which the first disbursement is 
        made on or after July 1, 1998, and before October 1, 1998, the 
        applicable rate of interest shall, during any 12-month period 
        beginning on July 1 and ending on June 30, be determined on the 
        preceding June 1 and be equal to--
                (i) the bond equivalent rate of 91-day Treasury bills 
            auctioned at the final auction held prior to such June 1; 
            plus
                (ii) 2.3 percent,

        except that such rate shall not exceed 8.25 percent.

        (B) In school and grace period rules

            Notwithstanding the preceding paragraphs of this subsection, 
        with respect to any Federal Direct Stafford Loan or Federal 
        Direct Unsubsidized Stafford Loan for which the first 
        disbursement is made on or after July 1, 1998, and before 
        October 1, 1998, the applicable rate of interest for interest 
        which accrues--
                (i) prior to the beginning of the repayment period of 
            the loan; or
                (ii) during the period in which principal need not be 
            paid (whether or not such principal is in fact paid) by 
            reason of a provision described in section 1078(b)(1)(M) or 
            1077(a)(2)(C) of this title,

        shall be determined under subparagraph (A) by substituting ``1.7 
        percent'' for ``2.3 percent''.

        (C) PLUS loans

            Notwithstanding the preceding paragraphs of this subsection, 
        with respect to Federal Direct PLUS Loan for which the first 
        disbursement is made on or after July 1, 1998, and before 
        October 1, 1998, the applicable rate of interest shall be 
        determined under subparagraph (A)--
                (i) by substituting ``3.1 percent'' for ``2.3 percent''; 
            and
                (ii) by substituting ``9.0 percent'' for ``8.25 
            percent''.

                         (6) \1\ Publication
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    \1\ So in original. Two pars. (6) have been enacted.
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        The Secretary shall determine the applicable rates of interest 
    under this subsection after consultation with the Secretary of the 
    Treasury and shall publish such rate in the Federal Register as soon 
    as practicable after the date of determination.

     (6) \1\ Interest rate provision for new loans on or after 
                  October 1, 1998, and before July 1, 2003

        (A) Rates for FDSL and FDUSL

            Notwithstanding the preceding paragraphs of this subsection, 
        for Federal Direct Stafford Loans and Federal Direct 
        Unsubsidized Stafford Loans for which the first disbursement is 
        made on or after October 1, 1998, and before July 1, 2003, the 
        applicable rate of interest shall, during any 12-month period 
        beginning on July 1 and ending on June 30, be determined on the 
        preceding June 1 and be equal to--
                (i) the bond equivalent rate of 91-day Treasury bills 
            auctioned at the final auction held prior to such June 1; 
            plus
                (ii) 2.3 percent,

        except that such rate shall not exceed 8.25 percent.

        (B) In school and grace period rules

            Notwithstanding the preceding paragraphs of this subsection, 
        with respect to any Federal Direct Stafford Loan or Federal 
        Direct Unsubsidized Stafford Loan for which the first 
        disbursement is made on or after October 1, 1998, and before 
        July 1, 2003, the applicable rate of interest for interest which 
        accrues--
                (i) prior to the beginning of the repayment period of 
            the loan; or
                (ii) during the period in which principal need not be 
            paid (whether or not such principal is in fact paid) by 
            reason of a provision described in section 1078(b)(1)(M) or 
            1077(a)(2)(C) of this title,

        shall be determined under subparagraph (A) by substituting ``1.7 
        percent'' for ``2.3 percent''.

        (C) PLUS loans

            Notwithstanding the preceding paragraphs of this subsection, 
        with respect to Federal Direct PLUS Loan for which the first 
        disbursement is made on or after October 1, 1998, and before 
        July 1, 2003, the applicable rate of interest shall be 
        determined under subparagraph (A)--
                (i) by substituting ``3.1 percent'' for ``2.3 percent''; 
            and
                (ii) by substituting ``9.0 percent'' for ``8.25 
            percent''.

        (D) Consolidation loans

            Notwithstanding the preceding paragraphs of this subsection, 
        any Federal Direct Consolidation loan for which the application 
        is received on or after February 1, 1999, and before July 1, 
        2003, shall bear interest at an annual rate on the unpaid 
        principal balance of the loan that is equal to the lesser of--
                (i) the weighted average of the interest rates on the 
            loans consolidated, rounded to the nearest higher one-eighth 
            of one percent; or
                (ii) 8.25 percent.

        (E) Temporary rules for consolidation loans

            Notwithstanding the preceding paragraphs of this subsection, 
        any Federal Direct Consolidation loan for which the application 
        is received on or after October 1, 1998, and before February 1, 
        1999, shall bear interest at an annual rate on the unpaid 
        principal balance of the loan that is equal to--
                (i) the bond equivalent rate of 91-day Treasury bills 
            auctioned at the final auction held prior to such June 1; 
            plus
                (ii) 2.3 percent,

        except that such rate shall not exceed 8.25 percent.

                      (7) Repayment incentives

        (A) In general

            Notwithstanding any other provision of this part, the 
        Secretary is authorized to prescribe by regulation such 
        reductions in the interest rate paid by a borrower of a loan 
        made under this part as the Secretary determines appropriate to 
        encourage on-time repayment of the loan. Such reductions may be 
        offered only if the Secretary determines the reductions are cost 
        neutral and in the best financial interest of the Federal 
        Government. Any increase in subsidy costs resulting from such 
        reductions shall be completely offset by corresponding savings 
        in funds available for the William D. Ford Federal Direct Loan 
        Program in that fiscal year from section 1087h of this title and 
        other administrative accounts.

        (B) Accountability

            Prior to publishing regulations proposing repayment 
        incentives, the Secretary shall ensure the cost neutrality of 
        such reductions. The Secretary shall not prescribe such 
        regulations in final form unless an official report from the 
        Director of the Office of Management and Budget to the Secretary 
        and a comparable report from the Director of the Congressional 
        Budget Office to the Congress each certify that any such 
        reductions will be completely cost neutral. Such reports shall 
        be transmitted to the Committee on Labor and Human Resources of 
        the Senate and the Committee on Education and the Workforce of 
        the House of Representatives not less than 60 days prior to the 
        publication of regulations proposing such reductions.

(c) Loan fee

    The Secretary shall charge the borrower of a loan made under this 
part an origination fee of 4.0 percent of the principal amount of loan.

(d) Repayment plans

                      (1) Design and selection

        Consistent with criteria established by the Secretary, the 
    Secretary shall offer a borrower of a loan made under this part a 
    variety of plans for repayment of such loan, including principal and 
    interest on the loan. The borrower shall be entitled to accelerate, 
    without penalty, repayment on the borrower's loans under this part. 
    The borrower may choose--
            (A) a standard repayment plan, with a fixed annual repayment 
        amount paid over a fixed period of time, consistent with 
        subsection (a)(1) of this section;
            (B) an extended repayment plan, with a fixed annual 
        repayment amount paid over an extended period of time, except 
        that the borrower shall annually repay a minimum amount 
        determined by the Secretary in accordance with section 
        1078(b)(1)(L) of this title;
            (C) a graduated repayment plan, with annual repayment 
        amounts established at 2 or more graduated levels and paid over 
        a fixed or extended period of time, except that the borrower's 
        scheduled payments shall not be less than 50 percent, nor more 
        than 150 percent, of what the amortized payment on the amount 
        owed would be if the loan were repaid under the standard 
        repayment plan; and
            (D) an income contingent repayment plan, with varying annual 
        repayment amounts based on the income of the borrower, paid over 
        an extended period of time prescribed by the Secretary, not to 
        exceed 25 years, except that the plan described in this 
        subparagraph shall not be available to the borrower of a Federal 
        Direct PLUS loan.

                     (2) Selection by Secretary

        If a borrower of a loan made under this part does not select a 
    repayment plan described in paragraph (1), the Secretary may provide 
    the borrower with a repayment plan described in subparagraph (A), 
    (B), or (C) of paragraph (1).

                      (3) Changes in selections

        The borrower of a loan made under this part may change the 
    borrower's selection of a repayment plan under paragraph (1), or the 
    Secretary's selection of a plan for the borrower under paragraph 
    (2), as the case may be, under such terms and conditions as may be 
    established by the Secretary.

                   (4) Alternative repayment plans

        The Secretary may provide, on a case by case basis, an 
    alternative repayment plan to a borrower of a loan made under this 
    part who demonstrates to the satisfaction of the Secretary that the 
    terms and conditions of the repayment plans available under 
    paragraph (1) are not adequate to accommodate the borrower's 
    exceptional circumstances. In designing such alternative repayment 
    plans, the Secretary shall ensure that such plans do not exceed the 
    cost to the Federal Government, as determined on the basis of the 
    present value of future payments by such borrowers, of loans made 
    using the plans available under paragraph (1).

                     (5) Repayment after default

        The Secretary may require any borrower who has defaulted on a 
    loan made under this part to--
            (A) pay all reasonable collection costs associated with such 
        loan; and
            (B) repay the loan pursuant to an income contingent 
        repayment plan.

(e) Income contingent repayment

                   (1) Information and procedures

        The Secretary may obtain such information as is reasonably 
    necessary regarding the income of a borrower (and the borrower's 
    spouse, if applicable) of a loan made under this part that is, or 
    may be, repaid pursuant to income contingent repayment, for the 
    purpose of determining the annual repayment obligation of the 
    borrower. Returns and return information (as defined in section 6103 
    of title 26) may be obtained under the preceding sentence only to 
    the extent authorized by section 6103(l)(13) of title 26. The 
    Secretary shall establish procedures for determining the borrower's 
    repayment obligation on that loan for such year, and such other 
    procedures as are necessary to implement effectively income 
    contingent repayment.

            (2) Repayment based on adjusted gross income

        A repayment schedule for a loan made under this part and repaid 
    pursuant to income contingent repayment shall be based on the 
    adjusted gross income (as defined in section 62 of title 26) of the 
    borrower or, if the borrower is married and files a Federal income 
    tax return jointly with the borrower's spouse, on the adjusted gross 
    income of the borrower and the borrower's spouse.

                      (3) Additional documents

        A borrower who chooses, or is required, to repay a loan made 
    under this part pursuant to income contingent repayment, and for 
    whom adjusted gross income is unavailable or does not reasonably 
    reflect the borrower's current income, shall provide to the 
    Secretary other documentation of income satisfactory to the 
    Secretary, which documentation the Secretary may use to determine an 
    appropriate repayment schedule.

                       (4) Repayment schedules

        Income contingent repayment schedules shall be established by 
    regulations promulgated by the Secretary and shall require payments 
    that vary in relation to the appropriate portion of the annual 
    income of the borrower (and the borrower's spouse, if applicable) as 
    determined by the Secretary.

                   (5) Calculation of balance due

        The balance due on a loan made under this part that is repaid 
    pursuant to income contingent repayment shall equal the unpaid 
    principal amount of the loan, any accrued interest, and any fees, 
    such as late charges, assessed on such loan. The Secretary may 
    promulgate regulations limiting the amount of interest that may be 
    capitalized on such loan, and the timing of any such capitalization.

                    (6) Notification to borrowers

        The Secretary shall establish procedures under which a borrower 
    of a loan made under this part who chooses or is required to repay 
    such loan pursuant to income contingent repayment is notified of the 
    terms and conditions of such plan, including notification of such 
    borrower--
            (A) that the Internal Revenue Service will disclose to the 
        Secretary tax return information as authorized under section 
        6103(l)(13) of title 26; and
            (B) that if a borrower considers that special circumstances, 
        such as a loss of employment by the borrower or the borrower's 
        spouse, warrant an adjustment in the borrower's loan repayment 
        as determined using the information described in subparagraph 
        (A), or the alternative documentation described in paragraph 
        (3), the borrower may contact the Secretary, who shall determine 
        whether such adjustment is appropriate, in accordance with 
        criteria established by the Secretary.

(f) Deferment

                (1) Effect on principal and interest

        A borrower of a loan made under this part who meets the 
    requirements described in paragraph (2) shall be eligible for a 
    deferment, during which periodic installments of principal need not 
    be paid, and interest--
            (A) shall not accrue, in the case of a--
                (i) Federal Direct Stafford Loan; or
                (ii) a Federal Direct Consolidation Loan that 
            consolidated only Federal Direct Stafford Loans, or a 
            combination of such loans and Federal Stafford Loans for 
            which the student borrower received an interest subsidy 
            under section 1078 of this title; or

            (B) shall accrue and be capitalized or paid by the borrower, 
        in the case of a Federal Direct PLUS Loan, a Federal Direct 
        Unsubsidized Stafford Loan, or a Federal Direct Consolidation 
        Loan not described in subparagraph (A)(ii).

                           (2) Eligibility

        A borrower of a loan made under this part shall be eligible for 
    a deferment during any period--
            (A) during which the borrower--
                (i) is carrying at least one-half the normal full-time 
            work load for the course of study that the borrower is 
            pursuing, as determined by the eligible institution (as such 
            term is defined in section 1085(a) of this title) the 
            borrower is attending; or
                (ii) is pursuing a course of study pursuant to a 
            graduate fellowship program approved by the Secretary, or 
            pursuant to a rehabilitation training program for 
            individuals with disabilities approved by the Secretary,

        except that no borrower shall be eligible for a deferment under 
        this subparagraph, or a loan made under this part (other than a 
        Federal Direct PLUS Loan or a Federal Direct Consolidation 
        Loan), while serving in a medical internship or residency 
        program;
            (B) not in excess of 3 years during which the borrower is 
        seeking and unable to find full-time employment;
            (C) not in excess of 3 years during which the Secretary 
        determines, in accordance with regulations prescribed under 
        section 1085(o) of this title, that the borrower has experienced 
        or will experience an economic hardship.

                      (3) ``Borrower'' defined

        For the purpose of this subsection, the term ``borrower'' means 
    an individual who is a new borrower on the date such individual 
    applies for a loan under this part for which the first disbursement 
    is made on or after July 1, 1993.

          (4) Deferments for previous part B loan borrowers

        A borrower of a loan made under this part, who at the time such 
    individual applies for such loan, has an outstanding balance of 
    principal or interest owing on any loan made, insured, or guaranteed 
    under part B of this subchapter prior to July 1, 1993, shall be 
    eligible for a deferment under section 1077(a)(2)(C) of this title 
    or section 1078(b)(1)(M) of this title as such sections were in 
    effect on July 22, 1992.

(g) Federal Direct Consolidation Loans

    A borrower of a loan made under this part may consolidate such loan 
with the loans described in section 1078-3(a)(4) of this title. Loans 
made under this subsection shall be known as ``Federal Direct 
Consolidation Loans''.

(h) Borrower defenses

    Notwithstanding any other provision of State or Federal law, the 
Secretary shall specify in regulations (except as authorized under 
section 1087g(a)(1) of this title) which acts or omissions of an 
institution of higher education a borrower may assert as a defense to 
repayment of a loan made under this part, except that in no event may a 
borrower recover from the Secretary, in any action arising from or 
relating to a loan made under this part, an amount in excess of the 
amount such borrower has repaid on such loan.

(i) Loan application and promissory note

    The common financial reporting form required in section 1090(a)(1) 
of this title shall constitute the application for loans made under this 
part (other than a Federal Direct PLUS loan). The Secretary shall 
develop, print, and distribute to participating institutions a standard 
promissory note and loan disclosure form.

(j) Loan disbursement

                           (1) In general

        Proceeds of loans to students under this part shall be applied 
    to the student's account for tuition and fees, and, in the case of 
    institutionally owned housing, to room and board. Loan proceeds that 
    remain after the application of the previous sentence shall be 
    delivered to the borrower by check or other means that is payable to 
    and requires the endorsement or other certification by such 
    borrower.

                         (2) Payment periods

        The Secretary shall establish periods for the payments described 
    in paragraph (1) in a manner consistent with payment of Federal Pell 
    Grants under subpart 1 of part A of this subchapter.

(k) Fiscal control and fund accountability

                           (1) In general

        (A) An institution shall maintain financial records in a manner 
    consistent with records maintained for other programs under this 
    subchapter.
        (B) Except as otherwise required by regulations of the 
    Secretary, or in a notice under section 1087g(a)(1) of this title, 
    an institution may maintain loan funds under this part in the same 
    account as other Federal student financial assistance.

                      (2) Payments and refunds

        Payments and refunds shall be reconciled in a manner consistent 
    with the manner set forth for the submission of a payment summary 
    report required of institutions participating in the program under 
    subpart 1 of part A of this subchapter, except that nothing in this 
    paragraph shall prevent such reconciliations on a monthly basis.

                      (3) Transaction histories

        All transaction histories under this part shall be maintained 
    using the same system designated by the Secretary for the provision 
    of Federal Pell Grants under subpart 1 of part A of this subchapter.

(Pub. L. 89-329, title IV, Sec. 455, as added Pub. L. 99-498, title IV, 
Sec. 404, Oct. 17, 1986, 100 Stat. 1439; amended Pub. L. 102-325, title 
IV, Sec. 451, July 23, 1992, 106 Stat. 572; Pub. L. 103-66, title IV, 
Sec. 4021, Aug. 10, 1993, 107 Stat. 346; Pub. L. 103-382, title III, 
Sec. 359, Oct. 20, 1994, 108 Stat. 3968; Pub. L. 105-178, title VIII, 
Sec. 8301(c), June 9, 1998, 112 Stat. 498; Pub. L. 105-244, title IV, 
Secs. 401(g)(6), 452(a)(1), (b), (c), Oct. 7, 1998, 112 Stat. 1652, 
1715-1717; Pub. L. 106-554, Sec. 1(a)(1) [title III, Sec. 318(b)], Dec. 
21, 2000, 114 Stat. 2763, 2763A-49.)

                       References in Text

    Sections 1077(a)(2)(C) and 1078(b)(1)(M) of this title as such 
sections were in effect on July 22, 1992, referred to in subsec. (f)(4), 
means sections 1077(a)(2)(C) and 1078(b)(1)(M) of this title prior to 
being amended generally by sections 414(b) and 416(e)(1), respectively, 
of Pub. L. 102-325, title IV, July 23, 1992, 106 Stat. 513, 519.


                               Amendments

    2000--Subsec. (b)(4)(A). Pub. L. 106-554 amended subpar. (A) 
generally. Prior to amendment, subpar. (A) read as follows: ``For 
Federal Direct PLUS Loans for which the first disbursement is made on or 
after July 1, 1994, the applicable rate of interest shall, during any 
12-month period beginning on July 1 and ending on June 30, be determined 
on the preceding June 1 and be equal to--
        ``(i) the bond equivalent rate of 52-week Treasury bills 
    auctioned at final auction held prior to such June 1; plus
        ``(ii) 3.1 percent,
except that such rate shall not exceed 9 percent.''
    1998--Subsec. (b)(5). Pub. L. 105-178, Sec. 8301(c)(2), which 
directed amendment of section 455(b) (20 U.S.C. 1087e(b)) by adding par. 
(5), was executed to this section, which is section 455(b) of Pub. L. 
89-329, to reflect the probable intent of Congress. Former par. (5) 
redesignated (6).
    Subsec. (b)(6). Pub. L. 105-244, Sec. 452(a)(1), added par. (6) 
relating to interest rate provision for new loans.
    Pub. L. 105-178, Sec. 8301(c)(1), which directed amendment of 
section 455(b) (20 U.S.C. 1087e(b)) by redesignating par. (5) as (6), 
was executed to this section, which is section 455(b) of Pub. L. 89-329, 
to reflect the probable intent of Congress.
    Subsec. (b)(7). Pub. L. 105-244, Sec. 452(b), added par. (7).
    Subsec. (g). Pub. L. 105-244, Sec. 452(c), struck out ``only under 
such terms and conditions as the Secretary shall establish pursuant to 
section 1087g(a)(1) of this title or regulations promulgated under this 
part'' after ``section 1078-3(a)(4) of this title''.
    Subsecs. (j)(2), (k)(3). Pub. L. 105-244, Sec. 401(g)(6), 
substituted ``Federal Pell Grants'' for ``basic grants''.
    1994--Subsec. (f)(3), (4). Pub. L. 103-382 added pars. (3) and (4).
    1993--Pub. L. 103-66 amended section generally, substituting 
provisions relating to terms and conditions of loans for former 
provisions relating to withdrawal and termination procedures.
    1992--Pub. L. 102-325 amended section generally, substituting 
provisions relating to withdrawal and termination procedures for former 
provisions relating to feasibility study.


                    Effective Date of 1998 Amendment

    Amendment by sections 401(g)(6) and 452(b), (c) of Pub. L. 105-244 
effective Oct. 1, 1998, except as otherwise provided in Pub. L. 105-244, 
see section 3 of Pub. L. 105-244, set out as a note under section 1001 
of this title.
    Pub. L. 105-244, title IV, Sec. 452(d), Oct. 7, 1998, 112 Stat. 
1717, provided that: ``The amendments made by subsection (a) [amending 
this section] shall apply with respect to any loan made under part D of 
title IV of the Higher Education Act of 1965 [this part] for which the 
first disbursement is made on or after October 1, 1998, and before July 
1, 2003, except that such amendments shall apply with respect to a 
Federal Direct Consolidation Loan for which the application is received 
on or after October 1, 1998, and before July 1, 2003.''


                    Effective Date of 1992 Amendment

    Amendment by Pub. L. 102-325 effective Oct. 1, 1992, see section 2 
of Pub. L. 102-325, set out as a note under section 1001 of this title.


    Limitation on Consolidation Loans During Temporary Interest Rate

    Pub. L. 105-244, title IV, Sec. 452(a)(2), Oct. 7, 1998, 112 Stat. 
1716, provided that: ``Notwithstanding section 455(g) of the Higher 
Education Act of 1965 [subsec. (g) of this section], a borrower who is 
enrolled or accepted for enrollment in an institution of higher 
education may not consolidate loans under such section during the period 
beginning October 1, 1998, and ending February 1, 1999, unless the 
borrower certifies that the borrower has no outstanding loans made, 
insured, or guaranteed under title IV of such Act [20 U.S.C. 1070 et 
seq.; 42 U.S.C. 2751 et seq.] other than loans made under part D of such 
title [this part].''

                  Section Referred to in Other Sections

    This section is referred to in sections 1078-3, 1087i of this title; 
title 2 section 906.
