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| section_id ▼ | title_number | title_name | chapter | subchapter | part_number | part_name | subpart | subpart_name | section_number | section_heading | agency | authority | source_citation | amendment_citations | full_text |
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| 20:20:4.0.1.1.11.1.5.1 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | A | Subpart A—General Description | § 682.100 What are the statewide employment and training activities under title I of the Workforce Innovation and Opportunity Act? | DOL | Statewide employment and training activities include those activities for adults and dislocated workers, as described in WIOA sec. 134(a), and statewide youth activities, as described in the Workforce Innovation and Opportunity Act (WIOA) sec. 129(b). They include both required and allowable activities. In accordance with the requirements of this subpart, the State may develop policies and strategies for use of statewide employment and training funds. Descriptions of these policies and strategies must be included in the State Plan. | |||||
| 20:20:4.0.1.1.11.1.5.2 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | A | Subpart A—General Description | § 682.110 How are statewide employment and training activities funded? | DOL | (a) Except for the statewide rapid response activities described in paragraph (c) of this section, statewide employment and training activities are supported by funds reserved by the Governor under WIOA sec. 128(a). (b) Funds reserved by the Governor for statewide workforce investment activities may be combined and used for any of the activities authorized in WIOA sec. 129(b), 134(a)(2)(B), or 134(a)(3)(A) (which are described in §§ 682.200 and 682.210), regardless of whether the funds were allotted through the youth, adult, or dislocated worker funding streams. (c) Funds for statewide rapid response activities are reserved under WIOA sec.133(a)(2) and may be used to provide the activities authorized at WIOA sec. 134(a)(2)(A) (which are described in §§ 682.310 through 682.330). | |||||
| 20:20:4.0.1.1.11.2.5.1 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | B | Subpart B—Required and Allowable Statewide Employment and Training Activities | § 682.200 What are required statewide employment and training activities? | DOL | Required statewide employment and training activities are: (a) Required rapid response activities, as described in § 682.310; (b) Disseminating by various means, as provided by WIOA sec. 134(a)(2)(B): (1) The State list of eligible training providers (including those providing non-traditional training services), for adults and dislocated workers and eligible training providers of registered apprenticeship programs; (2) Information identifying eligible providers of on-the-job training (OJT), customized training, incumbent worker training (see § 680.790 of this chapter), internships, paid or unpaid work experience opportunities (see § 680.180 of this chapter) and transitional jobs (see § 680.190 of this chapter); (3) Information on effective outreach and partnerships with business; (4) Information on effective service delivery strategies and promising practices to serve workers and job seekers; (5) Performance information and information on the cost of attendance, including tuition and fees, consistent with the requirements of §§ 680.490 and 680.530 of this chapter; (6) A list of eligible providers of youth activities as described in WIOA sec. 123; and (7) Information of physical and programmatic accessibility for individuals with disabilities; (c) States must assure that the information listed in paragraphs (b)(1) through (7) of this section is widely available; (d) Conducting evaluations under WIOA sec. 116(e), consistent with the requirements found under § 682.220; (e) Providing technical assistance to State entities and agencies, local areas, and one-stop partners in carrying out activities described in the State Plan, including coordination and alignment of data systems used to carry out the requirements of this Act; (f) Assisting local areas, one-stop operators, one-stop partners, and eligible providers, including development of staff, including staff training to provide opportunities for individuals with barriers to employment to enter in-demand industry sectors or occupations and nontraditional… | |||||
| 20:20:4.0.1.1.11.2.5.2 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | B | Subpart B—Required and Allowable Statewide Employment and Training Activities | § 682.210 What are allowable statewide employment and training activities? | DOL | Allowable statewide employment and training activities may include: (a) State administration of the adult, dislocated worker and youth workforce investment activities, consistent with the five percent administrative cost limitation at WIOA sec. 134(a)(3)(B) and § 683.205(a)(1) of this chapter; (b) Developing and implementing innovative programs and strategies designed to meet the needs of all employers (including small employers) in the State, including the programs and strategies referenced in WIOA sec. 134(a)(3)(A)(i); (c) Developing strategies for serving individuals with barriers to employment, and for coordinating programs and services among one-stop partners; (d) Development or identification of education and training programs that have the characteristics referenced in WIOA sec. 134(a)(3)(A)(iii); (e) Implementing programs to increase the number of individuals training for and placed in non-traditional employment; (f) Conducting research and demonstrations related to meeting the employment and education needs of youth, adults and dislocated workers; (g) Supporting the development of alternative, evidence-based programs, and other activities that enhance the choices available to eligible youth and which encourage youth to reenter and complete secondary education, enroll in postsecondary education and advanced training, progress through a career pathway, and enter into unsubsidized employment that leads to economic self-sufficiency; (h) Supporting the provision of career services in the one-stop delivery system in the State as described in § 678.430 of this chapter and WIOA secs. 129(b)(2)(C) and 134(c)(2); (i) Supporting financial literacy activities as described in § 681.500 of this chapter and WIOA sec. 129(b)(2)(D); (j) Providing incentive grants to local areas for performance by the local areas on local performance accountability measures; (k) Providing technical assistance to Local Workforce Development Boards (WDBs), chief elected officials, one-stop operators, one-stop partners, and eligib… | |||||
| 20:20:4.0.1.1.11.2.5.3 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | B | Subpart B—Required and Allowable Statewide Employment and Training Activities | § 682.220 What are States' responsibilities in regard to evaluations? | DOL | (a) As required by § 682.200(d), States must use funds reserved by the Governor for statewide activities to conduct evaluations of activities under the WIOA title I core programs in order to promote continuous improvement, research and test innovative services and strategies, and achieve high levels of performance and outcomes. (b) Evaluations conducted under paragraph (a) of this section must: (1) Be coordinated with and designed in conjunction with State and Local WDBs and with State agencies responsible for the administration of all core programs; (2) When appropriate, include analysis of customer feedback and outcome and process measures in the statewide workforce development system; (3) Use designs that employ the most rigorous analytical and statistical methods that are reasonably feasible, such as the use of control groups; and (4) To the extent feasible, be coordinated with the evaluations provided for by the Secretary of Labor and the Secretary of Education under WIOA sec. 169 (regarding title I programs and other employment-related programs), WIOA sec. 242(c)(2)(D) (regarding adult education), sec. 12(a)(5), 14, and 107 of the Rehabilitation Act of 1973 (29 U.S.C. 709(a)(5), 711, 727) (applied with respect to programs carried out under title I of that Act (29 U.S.C. 720 et seq. )), and the investigations provided by the Secretary of Labor under sec. 10(b) of the Wagner-Peyser Act (29 U.S.C. 49i(b)). (c) States must annually prepare, submit to the State WDB and Local WDBs in the State, and make available to the public (including by electronic means) reports containing the results, as available, of the evaluations described in paragraph (a) of this section. (d) States must cooperate, to the extent practicable, in evaluations and related research projects conducted by the Secretaries of Labor and Education under the laws cited in paragraph (b)(4) of this section. Such cooperation must, at a minimum, meet the following requirements: (1) The timely provision of: (i) Data, in accordance with appropr… | |||||
| 20:20:4.0.1.1.11.3.5.1 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.300 What is rapid response, and what is its purpose? | DOL | (a) Rapid response is described in §§ 682.300 through 682.370, and encompasses the strategies and activities necessary to: (1) Plan for and respond to as quickly as possible following an event described in § 682.302; and (2) Deliver services to enable dislocated workers to transition to new employment as quickly as possible. (b) The purpose of rapid response is to promote economic recovery and vitality by developing an ongoing, comprehensive approach to identifying, planning for, responding to layoffs and dislocations, and preventing or minimizing their impacts on workers, businesses, and communities. A successful rapid response system includes: (1) Informational and direct reemployment services for workers, including but not limited to information and support for filing unemployment insurance claims, information on the impacts of layoff on health coverage or other benefits, information on and referral to career services, reemployment-focused workshops and services, and training; (2) Delivery of solutions to address the needs of businesses in transition, provided across the business lifecycle (expansion and contraction), including comprehensive business engagement and layoff aversion strategies and activities designed to prevent or minimize the duration of unemployment; (3) Convening, brokering, and facilitating the connections, networks and partners to ensure the ability to provide assistance to dislocated workers and their families such as home heating assistance, legal aid, and financial advice; and (4) Strategic planning, data gathering and analysis designed to anticipate, prepare for, and manage economic change. | |||||
| 20:20:4.0.1.1.11.3.5.10 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.370 What are the statewide activities for which rapid response funds remaining unobligated after the first program year for which the funds were allotted may be used by the State? | DOL | Funds reserved by the Governor for rapid response activities that remain unobligated after the first program year for which such funds were allotted may be used by the Governor to carry out statewide activities under §§ 682.200 and 682.210. Statewide activities for which these funds may be used include prioritizing the planning for and delivery of activities designed to prevent job loss, increasing the rate of reemployment, building relationships with businesses and other stakeholders, building and maintaining early warning networks and systems, and otherwise supporting efforts to allow long-term unemployed workers to return to work. | |||||
| 20:20:4.0.1.1.11.3.5.2 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.302 Under what circumstances must rapid response services be delivered? | DOL | Rapid response must be delivered when one or more of the following circumstances occur: (a) Announcement or notification of a permanent closure, regardless of the number of workers affected; (b) Announcement or notification of a mass layoff as defined in § 682.305; (c) A mass job dislocation resulting from a natural or other disaster; or (d) The filing of a Trade Adjustment Assistance (TAA) petition. | |||||
| 20:20:4.0.1.1.11.3.5.3 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.305 How does the Department define the term “mass layoff” for the purposes of rapid response? | DOL | For the purposes of rapid response, the term “mass layoff” used throughout this subpart will have occurred when at least one of the following conditions have been met: (a) A layoff meets the State's definition of mass layoff, as long as the definition does not exceed a minimum threshold of 50 affected workers; (b) Where a State has not defined a minimum threshold for mass layoff meeting the requirements of paragraph (a) of this section, layoffs affecting 50 or more workers; or (c) When a Worker Adjustment and Retraining Notification (WARN) Act notice has been filed, regardless of the number of workers affected by the layoff announced. | |||||
| 20:20:4.0.1.1.11.3.5.4 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.310 Who is responsible for carrying out rapid response activities? | DOL | (a) Rapid response activities must be carried out by the State or an entity designated by the State, in conjunction with the Local WDBs, chief elected officials, and other stakeholders, as provided by WIOA secs. 133(a)(2) and 134(a)(2)(A). (b) States must establish and maintain a rapid response unit to carry out statewide rapid response activities and to oversee rapid response activities undertaken by a designated State entity, Local WDB, or the chief elected officials for affected local areas, as provided under WIOA sec. 134(a)(2)(A)(i)(I). | |||||
| 20:20:4.0.1.1.11.3.5.5 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.320 What is layoff aversion, and what are appropriate layoff aversion strategies and activities? | DOL | (a) Layoff aversion consists of strategies and activities, including those provided in paragraph (b) of this section and §§ 682.330 and 682.340, to prevent or minimize the duration of unemployment resulting from layoffs. (b) Layoff aversion activities may include: (1) Providing assistance to employers in managing reductions in force, which may include early identification of firms at risk of layoffs, assessment of the needs of and options for at-risk firms, and the delivery of services to address these needs, as provided by WIOA sec. 134(d)(1)(A)(ix)(II)(cc); (2) Ongoing engagement, partnership, and relationship-building activities with businesses in the community, in order to create an environment for successful layoff aversion efforts and to enable the provision of assistance to dislocated workers in obtaining reemployment as soon as possible; (3) Funding feasibility studies to determine if a company's operations may be sustained through a buyout or other means to avoid or minimize layoffs; (4) Developing, funding, and managing incumbent worker training programs or other worker upskilling approaches as part of a layoff aversion strategy or activity; (5) Connecting companies to: (i) Short-time compensation or other programs designed to prevent layoffs or to reemploy dislocated workers quickly, available under Unemployment Insurance programs; (ii) Employer loan programs for employee skill upgrading; and (iii) Other Federal, State, and local resources as necessary to address other business needs that cannot be funded with resources provided under this title; (6) Establishing linkages with economic development activities at the Federal, State, and local levels, including Federal Department of Commerce programs and available State and local business retention and expansion activities; (7) Partnering or contracting with business-focused organizations to assess risks to companies, propose strategies to address those risks, implement services, and measure impacts of services delivered; (8) Conducting analys… | |||||
| 20:20:4.0.1.1.11.3.5.6 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.330 What rapid response activities are required? | DOL | Rapid response activities must include: (a) Layoff aversion activities as described in § 682.320, as applicable. (b) Immediate and on-site contact with the employer, representatives of the affected workers, and the local community, including an assessment of and plans to address the: (1) Layoff plans and schedule of the employer; (2) Background and probable assistance needs of the affected workers; (3) Reemployment prospects for workers; and (4) Available resources to meet the short and long-term assistance needs of the affected workers. (c) The provision of information and access to unemployment compensation benefits and programs, such as Short-Time Compensation, comprehensive one-stop delivery system services, and employment and training activities, including information on the TAA program (19 U.S.C. 2271 et seq. ), Pell Grants, the GI Bill, and other resources. (d) The delivery of other necessary services and resources including workshops and classes, use of worker transition centers, and job fairs, to support reemployment efforts for affected workers. (e) Partnership with the Local WDB(s) and chief elected official(s) to ensure a coordinated response to the dislocation event and, as needed, obtain access to State or local economic development assistance. Such coordinated response may include the development of an application for a national dislocated worker grant as provided under part 687 of this chapter. (f) The provision of emergency assistance adapted to the particular layoff or disaster. (g) As appropriate, developing systems and processes for: (1) Identifying and gathering information for early warning of potential layoffs or opportunities for layoff aversion; (2) Analyzing, and acting upon, data and information on dislocations and other economic activity in the State, region, or local area; and (3) Tracking outcome and performance data and information related to the activities of the rapid response program. (h) Developing and maintaining partnerships with other appropriate Federal, Stat… | |||||
| 20:20:4.0.1.1.11.3.5.7 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.340 May other activities be undertaken as part of rapid response? | DOL | (a) Yes, in order to conduct layoff aversion activities, or to prepare for and respond to dislocation events, in addition to the activities required under § 682.330, a State or designated entity may devise rapid response strategies or conduct activities that are intended to minimize the negative impacts of dislocation on workers, businesses, and communities and ensure rapid reemployment for workers affected by layoffs. (b) When circumstances allow, rapid response may provide guidance and/or financial assistance to establish community transition teams to assist the impacted community in organizing support for dislocated workers and in meeting the basic needs of their families, including heat, shelter, food, clothing and other necessities and services that are beyond the resources and ability of the one-stop delivery system to provide. | |||||
| 20:20:4.0.1.1.11.3.5.8 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.350 What is meant by “provision of additional assistance” in the Workforce Innovation and Opportunity Act? | DOL | As stated in WIOA sec. 133(a)(2), a State may reserve up to 25 percent of its allotted dislocated worker funds for rapid response activities. Once the State has reserved adequate funds for rapid response activities, such as those described in §§ 682.310, 682.320, and 682.330, any of the remaining funds reserved may be provided to local areas that experience increases of unemployment due to natural disasters, mass layoffs or other events, for provision of direct career services to participants if there are not adequate local funds available to assist the dislocated workers. States may wish to establish the policies or procedures governing the provision of additional assistance as described in § 682.340. | |||||
| 20:20:4.0.1.1.11.3.5.9 | 20 | Employees' Benefits | V | 682 | PART 682—STATEWIDE ACTIVITIES UNDER TITLE I OF THE WORKFORCE INNOVATION AND OPPORTUNITY ACT | C | Subpart C—Rapid Response Activities | § 682.360 What rapid response, layoff aversion, or other information will States be required to report to the Employment and Training Administration? | DOL | (a) Where a WIOA individual record exists for an individual served under programs reporting through the WIOA individual record, States must report information regarding the receipt of services under this subpart for such an individual. This information must be reported in the WIOA individual record. (b) States must comply with these requirements as explained in guidance issued by the Department of Labor. | |||||
| 34:34:4.1.1.1.2.1.1.1 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | A | Subpart A—Purpose and Scope | § 682.100 The Federal Family Education Loan programs. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 33348, June 28, 1994; 59 FR 61215, Nov. 29, 1994; 64 FR 18974, 18975, Apr. 16, 1999; 64 FR 58952, Nov. 1, 1999; 66 FR 34762, June 29, 2001; 71 FR 45698, Aug. 9, 2006; 78 FR 65806, Nov. 1, 2013] | (a) This part governs the following four programs collectively referred to in these regulations as “the Federal Family Education Loan (FFEL) programs,” in which lenders used their own funds prior to July 1, 2010, to make loans to enable a student or his or her parents to pay the costs of the student's attendance at postsecondary schools. (1) The Federal Stafford Loan (Stafford) Program, which encouraged making loans to undergraduate, graduate, and professional students. (2) The Federal Supplemental Loans for Students (SLS) Program, as in effect for periods of enrollment that began prior to July 1, 1994, which encouraged making loans to graduate, professional, independent undergraduate, and certain dependent undergraduate students. (3) The Federal PLUS (PLUS) Program, which encouraged making loans to parents of dependent undergraduate students. Before October 17, 1986, the PLUS Program also provided for making loans to graduate, professional, and independent undergraduate students. Before July 1, 1993, the PLUS Program also provided for making loans to parents of dependent graduate students. The PLUS Program also provided for making loans to graduate and professional students on or after July 1, 2006 and prior to July 1, 2010. (4) The Federal Consolidation Loan Program (Consolidation Loan Program), which encouraged making loans to borrowers for the purpose of consolidating loans: under the Federal Insured Student Loan (FISL), Stafford loan, SLS, ALAS (as in effect before October 17, 1986), PLUS, Perkins Loan programs, the Health Professions Student Loan (HPSL) including Loans for Disadvantaged Students (LDS) Program authorized by subpart II of part A of Title VII of the Public Health Services Act, Health Education Assistance Loans (HEAL) authorized by subpart I of Part A of Title VII of the Health Services Act, Nursing Student Loan Program loans authorized by subpart II of part B of title VIII of the Public Health Service Act, and existing loans obtained under the Consolidation Loan Program, and William D. For… | ||||
| 34:34:4.1.1.1.2.1.1.2 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | A | Subpart A—Purpose and Scope | § 682.101 Participation in the FFEL programs. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 61215, Nov. 29, 1994; 64 FR 18975, Apr. 16, 1999; 66 FR 34762, June 29, 2001; 71 FR 45698, Aug. 9, 2006; 71 FR 64397, Nov. 1, 2006; 78 FR 65806, Nov. 1, 2013] | The following entities and persons participate in the FFEL programs: (a) Eligible banks, savings and loan associations, credit unions, pension funds, insurance companies, schools, and State and private nonprofit agencies made loans prior to July 1, 2010. (b) Institutions of higher education, including most colleges, universities, graduate and professional schools, and many vocational, technical schools participated as schools, enabling an eligible student or his or her parents to obtain a loan to pay for the student's cost of education. (c) Students who met certain requirements, including enrollment at a participating school, borrowed under the Stafford Loan Program prior to July 1, 2010 and, for periods of enrollment that began prior to July 1, 1994, the SLS program. Parents of eligible dependent undergraduate students borrowed under the PLUS Program prior to July 1, 2010. Borrowers with outstanding Stafford, SLS, FISL, Perkins, HPSL, HEAL, ALAS, PLUS, or Nursing Student Loan Program loans borrowed under the Consolidation Loan Program prior to July 1, 2010. The PLUS Program also provided for making loans to graduate and professional students on or after July 1, 2006 and prior to July 1, 2010. | ||||
| 34:34:4.1.1.1.2.1.1.3 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | A | Subpart A—Purpose and Scope | § 682.102 Repaying a loan. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 25744, May 17, 1994; 59 FR 33348, June 28, 1994; 64 FR 18975, Apr. 16, 1999; 64 FR 58952, Nov. 1, 1999; 68 FR 75428, Dec. 31, 2003; 71 FR 45698, Aug. 9, 2006; 78 FR 65806, Nov. 1, 2013] | (a) General. Generally, the borrower is obligated to repay the full amount of the loan, late fees, collection costs chargeable to the borrower, and any interest not payable by the Secretary. The borrower's obligation to repay is cancelled if the borrower dies, becomes totally and permanently disabled, or has that obligation discharged in bankruptcy. A parent borrower's obligation to repay a PLUS loan is cancelled if the student, on whose behalf the parent borrowed, dies. The borrower's or student's obligation to repay all or a portion of his or her loan may be cancelled if the student is unable to complete his or her program of study because the school closed or the borrower's or student's eligibility to borrow was falsely certified by the school. The obligation to repay all or a portion of a loan may be forgiven for Stafford Loan borrowers who enter certain areas of the teaching profession. (b) Stafford loan repayment. In the case of a subsidized Stafford loan, a borrower is not required to make any principal payments during the time the borrower is in school. The Secretary pays the interest on the borrower's behalf during the time the borrower is in school. When the borrower ceases to be enrolled on at least a half-time basis, a grace period begins during which no principal payments are required, and the Secretary continues to make interest payments on the borrower's behalf. In the case of an unsubsidized Stafford loan, the borrower is responsible for interest during these periods. At the end of the grace period, the repayment period begins. During the repayment period, for the subsidized and unsubsidized Stafford loan, the borrower pays both the principal and the interest accruing on the loan. (c) SLS loan repayment. Generally, the repayment period for an SLS loan begins immediately on the day of the last disbursement of the loan proceeds by the lender. The first payment of principal and interest on an SLS loan is due from the borrower within 60 days after the loan is fully disbursed unless a borrower … | ||||
| 34:34:4.1.1.1.2.1.1.4 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | A | Subpart A—Purpose and Scope | § 682.103 Applicability of subparts. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 64 FR 18975, Apr. 16, 1999; 64 FR 58952, Nov. 1, 1999; 78 FR 65806, Nov. 1, 2013] | (a) Subpart B of this part contains general provisions that are applicable to all participants in the FFEL and Federal GSL programs. (b) The administration of the FFEL programs by a guaranty agency is subject to subparts C, D, F, and G of this part. (c) The Federal FFEL and Federal GSL programs are subject to subparts C, F, and G of this part. (d) Certain requirements applicable to schools under all the FFEL and Federal GSL programs are set forth in subpart F of this part. | ||||
| 34:34:4.1.1.1.2.2.1.1 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.200 Definitions. | ED | [57 FR 60323, Dec. 18, 1992] | (a)(1) The definitions of the following terms used in this part are set forth in the Student Assistance General Provisions, 34 CFR part 668: Academic year Campus-based programs Dependent student Eligible program Eligible student Enrolled Expected family contribution (EFC) Federal Consolidation Loan Program Federal Pell Grant Program Federal Perkins Loan Program Federal PLUS Program Federal Work-Study (FWS) Program Full-time student Half-time student Independent student National of the United States (Referred to as U.S. Citizen or National in 34 CFR 668.2) Payment period Teacher Education Assistance for College and Higher Education (TEACH) Grant Program TEACH Grant Undergraduate student Academic year Campus-based programs Dependent student Eligible program Eligible student Enrolled Expected family contribution (EFC) Federal Consolidation Loan Program Federal Pell Grant Program Federal Perkins Loan Program Federal PLUS Program Federal Work-Study (FWS) Program Full-time student Half-time student Independent student National of the United States (Referred to as U.S. Citizen or National in 34 CFR 668.2) Payment period Teacher Education Assistance for College and Higher Education (TEACH) Grant Program TEACH Grant Undergraduate student (2) The following definitions are set forth in the regulations for Institutional Eligibility under the Higher Education Act of 1965, as amended, 34 CFR part 600: Accredited Clock hour Correspondence course Credit hour Educational program Federal Family Education Loan Program (formerly known as the Guaranteed Student Loan (GSL) Program) Foreign institution Institution of higher education (§ 600.4) Nationally recognized accrediting agency Postsecondary Vocational Institution Preaccredited Secretary State Accredited Clock hour Correspondence course Credit hour Educational program Federal Family Education Loan Program (formerly known as the Guaranteed Student Loan (GSL) Pr… | ||||
| 34:34:4.1.1.1.2.2.1.10 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.210 Deferment. | ED | [57 FR 60323, Dec. 18, 1992] | (a) General. (1)(i) A borrower is entitled to have periodic installment payments of principal deferred during authorized periods after the beginning of the repayment period, pursuant to paragraph (b) and paragraphs (s) through (v) of this section. (ii) With the exception of a deferment authorized under paragraph (o) of this section, a borrower may continue to receive a specific type of deferment that is limited to a maximum period of time only if the total amount of time that the borrower has received the deferment does not exceed the maximum time period allowed for the deferment. (2)(i) For a loan made before October 1, 1981, the borrower is also entitled to have periodic installments of principal deferred during the six-month period (post-deferment grace period) that begins after the completion of each deferment period or combination of those periods, except as provided in paragraph (a)(2)(ii) of this section. (ii) Once a borrower receives a post-deferment grace period following an unemployment deferment, as described in paragraph (b)(1)(v) of this section, the borrower does not qualify for additional post-deferment grace periods following subsequent unemployment deferments. (3)(i) Interest accrues and is paid by— (A) The Secretary during the deferment period for a subsidized Stafford loan and for all or a portion of a Consolidation loan that qualifies for interest benefits under § 682.301; or (B) The borrower during the deferment period and, as applicable, the post-deferment grace period, on all other loans. (ii) A borrower who is responsible for payment of interest during a deferment period must be notified by the lender, at or before the time the deferment is granted, that the borrower has the option to pay the accruing interest or cancel the deferment and continue paying on the loan. The lender must also provide information, including an example, on the impact of capitalization of accrued, unpaid interest on loan principal, and on the total amount of interest to be paid over the life of the loan. … | ||||
| 34:34:4.1.1.1.2.2.1.11 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.211 Forbearance. | ED | [57 FR 60323, Dec. 18, 1992] | (a)(1) The Secretary encourages a lender to grant forbearance for the benefit of a borrower or endorser in order to prevent the borrower or endorser from defaulting on the borrower's or endorser's repayment obligation, or to permit the borrower or endorser to resume honoring that obligation after default. Forbearance means permitting the temporary cessation of payments, allowing an extension of time for making payments, or temporarily accepting smaller payments than previously were scheduled. (2) Subject to paragraph (g) of this section, a lender may grant forbearance of payments of principal and interest under paragraphs (b), (c), and (d) of this section only if— (i) The lender reasonably believes, and documents in the borrower's file, that the borrower or endorser intends to repay the loan but, due to poor health or other acceptable reasons, is currently unable to make scheduled payments; or (ii) The borrower's payments of principal are deferred under § 682.210 and the Secretary does not pay interest benefits on behalf of the borrower under § 682.301. (3) If two individuals are jointly liable for repayment of a PLUS loan or a Consolidation loan, the lender may grant forbearance on repayment of the loan only if the ability of both individuals to make scheduled payments has been impaired based on the same or differing conditions. (4) Except as provided in paragraph (f)(11) of this section, if payments of interest are forborne, they may be capitalized as provided in § 682.202(b). (b) A lender may grant forbearance if— (1) The lender and the borrower or endorser agree to the terms of the forbearance and, unless the agreement was in writing, the lender sends, within 30 days, a notice to the borrower or endorser confirming the terms of the forbearance and records the terms of the forbearance in the borrower's file; or (2) In the case of forbearance of interest during a period of deferment, if the lender informs the borrower at the time the deferment is granted that interest payments are to be forborne. (c)… | ||||
| 34:34:4.1.1.1.2.2.1.12 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.212 Prohibited transactions. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 72 FR 62002, Nov. 1, 2007; 74 FR 55664, Oct. 28, 2009] | (a) No points, premiums, payments, or additional interest of any kind may be paid or otherwise extended to any eligible lender or other party in order to— (1) Secure funds for making loans; or (2) Induce a lender to make loans to either the students or the parents of students of a particular school or particular category of students or their parents. (b) The following are examples of transactions that, if entered into for the purposes described in paragraph (a) of this section, are prohibited: (1) Cash payments by or on behalf of a school made to a lender or other party. (2) The maintaining of a compensating balance by or on behalf of a school with a lender. (3) Payments by or on behalf of a school to a lender of servicing costs on loans that the school does not own. (4) Payments by or on behalf of a school to a lender of unreasonably high servicing costs on loans that the school does own. (5) Purchase by or on behalf of a school of stock of the lender. (6) Payments ostensibly made for other purposes. (c) Except when purchased by an agency of any State functioning as a secondary market or in any other circumstances approved by the Secretary, notes, or any interest in notes, may not be sold or otherwise transferred at discount if the underlying loans were made— (1) By a school; or (2) To students or parents of students attending a school by a lender having common ownership with that school. (d) Except to secure a loan from an agency of a State functioning as a secondary market or in other circumstances approved by the Secretary, a school or lender (with respect to a loan made to a student, or a parent of a student, attending a school having common ownership with that lender), may not use a loan made under the FFEL programs as collateral for any loan bearing aggregate interest and other charges in excess of the sum of the interest rate applicable to the loan plus the rate of the most recently prescribed special allowance under § 682.302. (e) The prohibitions described in paragraphs (a), (b), (c), and … | ||||
| 34:34:4.1.1.1.2.2.1.13 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.213 Prohibition against the use of the Rule of 78s. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 68 FR 75429, Dec. 31, 2003] | For purposes of the calculations required by this part, a lender may not use the Rule of 78s to calculate the outstanding principal balance of a loan, except for a loan made to a borrower who entered repayment before June 26, 1987 and who was informed in the promissory note that interest on the loan would be calculated using the Rule of 78s. For those loans, the Rule of 78s must be used for the life of the loan. | ||||
| 34:34:4.1.1.1.2.2.1.14 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.214 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.2.1.15 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.215 Income-based repayment plan. | ED | [73 FR 63249, Oct. 23, 2008, as amended at 74 FR 55995, Oct. 29, 2009; 77 FR 66128, Nov. 1, 2012; 88 FR 43899, July 10, 2023] | (a) Definitions. As used in this section— (1) Adjusted gross income (AGI) means the borrower's adjusted gross income as reported to the Internal Revenue Service. For a married borrower filing jointly, AGI includes both the borrower's and spouse's income. For a married borrower filing separately, AGI includes only the borrower's income. (2) Eligible loan means any outstanding loan made to a borrower under the FFEL and Direct Loan programs except for a defaulted loan, a FFEL or Direct PLUS Loan made to a parent borrower, or a FFEL or Direct Consolidation Loan that repaid a FFEL or Direct PLUS Loan made to a parent borrower. (3) Family size means the number of individuals that is determined by adding together— (i) The borrower; (ii) The borrower's spouse, for a married borrower filing a joint Federal income tax return; (iii) The borrower's children, including unborn children who will be born during the year the borrower certifies family size, if the children receive more than half their support from the borrower and are not included in the family size for any other borrower except the borrower's spouse who filed jointly with the borrower; and (iv) Other individuals if, at the time the borrower certifies family size, the other individuals live with the borrower and receive more than half their support from the borrower and will continue to receive this support from the borrower for the year for which the borrower certifies family size. (4) Partial financial hardship means a circumstance in which— (i) For an unmarried borrower or a married borrower who files an individual Federal tax return, the annual amount due on all of the borrower's eligible loans, as calculated under a standard repayment plan based on a 10-year repayment period, using the greater of the amount due at the time the borrower initially entered repayment or at the time the borrower elects the income-based repayment plan, exceeds 15 percent of the difference between the borrower's AGI and 150 percent of the poverty guideline for the… | ||||
| 34:34:4.1.1.1.2.2.1.16 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.216 Teacher loan forgiveness program. | ED | [65 FR 65627, Nov. 1, 2000, as amended at 66 FR 34763, June 29, 2001; 71 FR 45702, Aug. 9, 2006; 71 FR 64398, Nov. 1, 2006; 73 FR 35495, June 23, 2008. Redesignated at 73 FR 63249, Oct. 23, 2008; 74 FR 55995, Oct. 29, 2009; 78 FR 65813, Nov. 1, 2013] | (a) General. (1) The teacher loan forgiveness program is intended to encourage individuals to enter and continue in the teaching profession. For new borrowers, the Secretary repays the amount specified in this paragraph on the borrower's subsidized and unsubsidized Federal Stafford Loans, Direct Subsidized Loans, Direct Unsubsidized Loans, and in certain cases, Federal Consolidation Loans or Direct Consolidation Loans. The forgiveness program is only available to a borrower who has no outstanding loan balance under the FFEL Program or the Direct Loan Program on October 1, 1998 or who has no outstanding loan balance on the date he or she obtains a loan after October 1, 1998. (2)(i) The borrower must have been employed at an eligible elementary or secondary school that serves low-income families or by an educational service agency that serves low-income families as a full-time teacher for five consecutive complete academic years. The required five years of teaching may include any combination of qualifying teaching service at an eligible elementary or secondary school or an eligible educational service agency. (ii) Teaching at an eligible elementary or secondary school may be counted toward the required five consecutive complete academic years only if at least one year of teaching was after the 1997-1998 academic year. (iii) Teaching for an educational service agency may be counted toward the required five consecutive complete academic years only if the consecutive five-year period includes qualifying service at an eligible educational service agency performed after the 2007-2008 academic year. (3) All borrowers eligible for teacher loan forgiveness may receive loan forgiveness of up to a combined total of $5,000 on the borrower's eligible FFEL and Direct Loan Program loans. (4) A borrower may receive loan forgiveness of up to a combined total of $17,500 on the borrower's eligible FFEL and Direct Loan Program loans if the borrower was employed for five consecutive years— (i) At an eligible secondary school … | ||||
| 34:34:4.1.1.1.2.2.1.2 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.201 Eligible borrowers. | ED | [57 FR 60323, Dec. 18, 1992] | (a) Student Stafford borrower. Except for a refinanced SLS/PLUS loan, a student is eligible to receive a Stafford loan, and an independent undergraduate student, a graduate or professional student, or, subject to paragraph (a)(3) of this section, a dependent undergraduate student, is eligible to receive an unsubsidized Stafford loan, if the student who is enrolled or accepted for enrollment on at least a half-time basis at a participating school meets the requirements for an eligible student under 34 CFR part 668, and— (1) In the case of an undergraduate student who seeks a Stafford loan or unsubsidized Stafford loan for the cost of attendance at a school that participates in the Pell Grant Program, has received a final determination, or, in the case of a student who has filed an application with the school for a Pell Grant, a preliminary determination, from the school of the student's eligibility or ineligibility for a Pell Grant and, if eligible, has applied for the period of enrollment for which the loan is sought; (2) In the case of any student who seeks an unsubsidized Stafford loan for the cost of attendance at a school that participates in the Stafford Loan Program, the student must— (i) Receive a determination of need for a subsidized Stafford loan; and (ii) If the determination of need is in excess of $200, have made a request to a lender for a subsidized Stafford loan; (3) For purposes of a dependent undergraduate student's eligibility for an additional unsubsidized Stafford loan amount, as described at § 682.204(d), is a dependent undergraduate student for whom the financial aid administrator determines and documents in the school's file, after review of the family financial information provided by the student and consideration of the student's debt burden, that the student's parents likely will be precluded by exceptional circumstances (e.g., denial of a PLUS loan to a parent based on adverse credit, the student's parent receives only public assistance or disability benefits, is incarcerated, o… | ||||
| 34:34:4.1.1.1.2.2.1.3 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.202 Permissible charges by lenders to borrowers. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22475, Apr. 29, 1994; 59 FR 61427, Nov. 30, 1994; 61 FR 60486, Nov. 27, 1996; 62 FR 63434, Nov. 28, 1997; 64 FR 18976, Apr. 16, 1999; 64 FR 58953, Nov. 1, 1999; 66 FR 34762, June 29, 2001; 71 FR 45700, Aug. 9, 2006; 72 FR 62000, Nov. 1, 2007; 74 FR 55991, Oct. 29, 2009; 78 FR 65807, Nov. 1, 2013; 80 FR 67236, Oct. 30, 2015; 81 FR 76079, Nov. 1, 2016] | The charges that lenders may impose on borrowers, either directly or indirectly, are limited to the following: (a) Interest. The applicable interest rates for FFEL Program loans are given in paragraphs (a)(1) through (a)(4) and (a)(8) of this section. (1) Stafford Loan Program. (i) For loans made prior to July 1, 1994, if the borrower, on the date the promissory note evidencing the loan was signed, had an outstanding balance of principal or interest on a previous Stafford loan, the interest rate is the applicable interest rate on that previous Stafford loan. (ii) If the borrower, on the date the promissory note evidencing the loan was signed, had no outstanding balance on any FFEL Program loan, and the first disbursement was made— (A) Prior to October 1, 1992, for a loan covering a period of instruction beginning on or after July 1, 1988, the interest rate is 8 percent until 48 months elapse after the repayment period begins, and 10 percent thereafter; or (B) On or after October 1, 1992, and prior to July 1, 1994, the interest rate is a variable rate, applicable to each July 1-June 30 period, that equals the lesser of— ( 1 ) The bond equivalent rate of the 91-day Treasury bills auctioned at the final auction prior to the June 1 immediately preceding the July 1-June 30 period, plus 3.10 percent; or ( 2 ) 9 percent. (iii) For a Stafford loan for which the first disbursement was made before October 1, 1992— (A) If the borrower, on the date the promissory note was signed, had no outstanding balance on a Stafford loan but had an outstanding balance of principal or interest on a PLUS or SLS loan made for a period of enrollment beginning before July 1, 1988, or on a Consolidation loan that repaid a loan made for a period of enrollment beginning before July 1, 1988, the interest rate is 8 percent; or (B) If the borrower, on the date the promissory note evidencing the loan was signed, had an outstanding balance of principal or interest on a PLUS or SLS loan made for a period of enrollment beginning on or aft… | ||||
| 34:34:4.1.1.1.2.2.1.4 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.203 Responsible parties. | ED | (a) Delegation of functions. A school, lender, or guaranty agency may contract or otherwise delegate the performance of its functions under the Act and this part to a servicing agency or other party. This contracting or other delegation of functions does not relieve the school, lender, or guaranty agency of its duty to comply with the requirements of the Act and this part. (b) Trustee responsibility. A lender that holds a loan in its capacity as a trustee assumes responsibility for complying with all statutory and regulatory requirements imposed on any other holders of a loan. | |||||
| 34:34:4.1.1.1.2.2.1.5 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.204 Maximum loan amounts. | ED | [59 FR 33350, June 28, 1994, as amended at 64 FR 18976, Apr. 16, 1999; 64 FR 58954, Nov. 1, 1999; 66 FR 34763, June 29, 2001; 67 FR 67078, Nov. 1, 2002; 71 FR 45700, Aug. 9, 2006; 71 FR 64397, Nov. 1, 2006; 73 FR 35495, June 23, 2008; 73 FR 36793, June 30, 2008; 74 FR 55991, Oct. 29, 2009; 78 FR 65808, Nov. 1, 2013] | (a) Stafford Loan Program annual limits. (1) In the case of an undergraduate student who has not successfully completed the first year of a program of undergraduate education, the total amount the student may borrow for any academic year of study under the Stafford Loan Program in combination with the Direct Subsidized Loan Program may not exceed the following: (i) $2,625, or, for a loan disbursed on or after July 1, 2007, $3,500, for a program of study of at least a full academic year in length. (ii) For a one-year program of study with less than a full academic year remaining, the amount that is the same ratio to $3,500, as the— (iii) For a program of study that is less than a full academic year in length, the amount that is the same ratio to $3,500 as the lesser of the— (2) In the case of a student who has successfully completed the first year of an undergraduate program but has not successfully completed the second year of an undergraduate program, the total amount the student may borrow for any academic year of study under the Stafford Loan Program in combination with the Direct Subsidized Loan Program may not exceed the following: (i) $4,500 for a program whose length is at least a full academic year in length. (ii) For a program of study with less than a full academic year remaining, an amount that is the same ratio to $4,500 as the— (3) In the case of an undergraduate student who has successfully completed the first and second years of a program of study of undergraduate education but has not successfully completed the remainder of the program, the total amount the student may borrow for any academic year of study under the Stafford Loan Program in combination with the Direct Subsidized Loan Program may not exceed the following: (i) $5,500 for a program whose length is at least an academic year in length. (ii) For a program of study with less than a full academic year remaining, an amount that is the same ratio to $5,500 as the— (4) In the case of a student who has an associate or baccalaureat… | ||||
| 34:34:4.1.1.1.2.2.1.6 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.205 Disclosure requirements for lenders. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 59 FR 25745, May 17, 1994; 60 FR 30788, June 12, 1995; 64 FR 18976, Apr. 16, 1999; 64 FR 58625, Oct. 29, 1999; 64 FR 58965, Nov. 1, 1999; 71 FR 45700. Aug. 9, 2006; 73 FR 63248, Oct. 23, 2008; 74 FR 55992, Oct. 29, 2009; 78 FR 65810, Nov. 1, 2013] | (a) Repayment information — (1) Disclosures at or prior to repayment. The lender must disclose the information described in paragraph (a)(2) of this section, in simple and understandable terms, in a statement provided to the borrower at or prior to the beginning of the repayment period. In the case of a Federal Stafford or Federal PLUS loan, the disclosures required by this paragraph must be made not less than 30 days nor more than 150 days before the first payment on the loan is due from the borrower. If the borrower enters the repayment period without the lender's knowledge, the lender must provide the required disclosures to the borrower immediately upon discovering that the borrower has entered the repayment period. (2) The lender shall provide the borrower with— (i) The lender's name, a toll-free telephone number accessible from within the United States that the borrower can use to obtain additional loan information, and the address to which correspondence with the lender and payments should be sent; (ii) The scheduled date the repayment period is to begin, or a deferment under § 682.210(v), if applicable, is to end; (iii) The estimated balance, including the estimated amount of interest to be capitalized, owed by the borrower as of the date upon which the repayment period is to begin, a deferment under § 682.210(v), if applicable, is to end, or the date of the disclosure, whichever is later; (iv) The actual interest rate on the loan; (v) An explanation of any fees that may accrue or be charged to the borrower during the repayment period; (vi) The borrower's repayment schedule, including the due date of the first installment and the number, amount, and frequency of payments based on the repayment schedule selected by the borrower; (vii) Except in the case of a Consolidation loan, an explanation of any special options the borrower may have for consolidating or refinancing the loan and of the availability and terms of such other options; (viii) The estimated total amount of interest to be paid on t… | ||||
| 34:34:4.1.1.1.2.2.1.7 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | §§ 682.206-682.207 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.2.1.8 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.208 Due diligence in servicing a loan. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 59 FR 22476, Apr. 29, 1994; 64 FR 18976, Apr. 16, 1999; 64 FR 58626, Oct. 29, 1999; 64 FR 58965, Nov. 1, 1999; 71 FR 45701, Aug. 9, 2006; 72 FR 62000, 62031, Nov. 1, 2007; 74 FR 55993, Oct. 29, 2009; 78 FR 65811, Nov. 1, 2013; 80 FR 67237, Oct. 30, 2015] | (a) The loan servicing process includes reporting to nationwide consumer reporting agencies, responding to borrower inquiries, establishing the terms of repayment, and reporting a borrower's enrollment and loan status information. (b)(1) An eligible lender of a FFEL loan shall report to each nationwide consumer reporting agency— (i) The total amount of FFEL loans the lender has made to the borrower, within 90 days of each disbursement; (ii) The outstanding balance of the loans; (iii) Information concerning the repayment status of the loan, no less frequently than every 90 days or quarterly after a change in that status from current to delinquent; (iv) The date the loan is fully repaid by, or on behalf of, the borrower, or discharged by reason of the borrower's death, bankruptcy, or total and permanent disability, within 90 days after that date; (v) Other information required by law to be reported. (2) An eligible lender that has acquired a FFEL loan shall report to each nationwide consumer reporting agency the information required by paragraph (b)(1)(ii)-(v) of this section within 90 days of its acquisition of the loan. (3) Upon receipt of a valid identity theft report as defined in section 603(q)(4) of the Fair Credit Reporting Act (15 U.S.C. 1681a) or notification from a consumer reporting agency that information furnished by the lender is a result of an alleged identity theft as defined in § 682.402(e)(14), an eligible lender shall suspend consumer reporting agency reporting for a period not to exceed 120 days while the lender determines the enforceability of a loan. (i) If the lender determines that a loan does not qualify for a discharge under § 682.402(e)(1)(i)(C), but is nonetheless unenforceable, the lender must— (A) Notify the consumer reporting agency of its determination; and (B) Comply with §§ 682.300(b)(2)(ix) and 682.302(d)(1)(viii). (ii) [Reserved] (4) If, within 3 years of the lender's receipt of an identity theft report, the lender receives from the borrower evidence specified in § 6… | ||||
| 34:34:4.1.1.1.2.2.1.9 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | B | Subpart B—General Provisions | § 682.209 Repayment of a loan. | ED | [57 FR 60323, Dec. 18, 1992] | (a) Conversion of a loan to repayment status. (1) For a Consolidation loan, the repayment period begins on the date the loan is disbursed. The first payment is due within 60 days after the date the loan is disbursed. (2)(i) For a PLUS loan, the repayment period begins on the date of the last disbursement made on the loan. Interest accrues and is due and payable from the date of the first disbursement of the loan. The first payment is due within 60 days after the date the loan is fully disbursed. (ii) For an SLS loan, the repayment period begins on the date the loan is disbursed, or, if the loan is disbursed in multiple installments, on the date of the last disbursement of the loan. Interest accrues and is due and payable from the date of the first disbursement of the loan. Except as provided in paragraph (a)(2)(iii), (a)(2)(iv), and (a)(2)(v) of this section the first payment is due within 60 days after the date the loan is fully disbursed. (iii) For an SLS borrower who has not yet entered repayment on a Stafford loan, the borrower may postpone payment, consistent with the grace period on the borrower's Stafford loan. (iv) If the lender first learns after the fact that an SLS borrower has entered the repayment period, the repayment begins no later than 75 days after the date the lender learns that the borrower has entered the repayment period. (v) The lender may establish a first payment due date that is no more than an additional 30 days beyond the period specified in paragraphs (a)(2)(i)-(a)(2)(iv) of this section in order for the lender to comply with the required deadline contained in § 682.205(c)(1). (3)(i) Except as provided in paragraph (a)(4) of this section, for a Stafford loan the repayment period begins— (A) For a borrower with a loan for which the applicable interest rate is 7 percent per year, not less than 9 nor more than 12 months following the date on which the borrower is no longer enrolled on at least a half-time basis at an eligible school. The length of this grace period is determined… | ||||
| 34:34:4.1.1.1.2.3.1.1 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | C | Subpart C—Federal Payments of Interest and Special Allowance | § 682.300 Payment of interest benefits on Stafford and Consolidation loans. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 25746, May 17, 1994; 59 FR 33352, June 28, 1994; 59 FR 61428, Nov. 30, 1994; 64 FR 18978, Apr. 16, 1999; 64 FR 58959, Nov. 1, 1999; 66 FR 34763, June 29, 2001; 71 FR 45703, Aug. 9, 2006; 72 FR 62002, Nov. 1, 2007; 73 FR 63252, Oct. 23, 2008; 78 FR 65813, Nov. 1, 2013] | (a) General. The Secretary pays a lender, on behalf of a borrower, a portion of the interest on a subsidized Stafford loan and on all or a portion of a qualifying Consolidation loan that meets the requirements under § 682.301. This payment is known as interest benefits. (b) Covered interest. (1) The Secretary pays a lender the interest that accrues on an eligible Stafford loan— (i) During all periods prior to the beginning of the repayment period, except as provided in paragraphs (b)(2) and (c) of this section. (ii) During any period when the borrower has an authorized deferment, and, if applicable, a post-deferment grace period; (iii) During the repayment period for loans described in paragraph (d)(2) of this section; and (iv) During a period that does not exceed three consecutive years from the established repayment period start date on each loan under the income-based repayment plan and that excludes any period during which the borrower receives an economic hardship deferment, if the borrower's monthly payment amount under the plan is not sufficient to pay the accrued interest on the borrower's loan or on the qualifying portion of the borrower's Consolidation Loan. (2) The Secretary's obligation to pay interest benefits on an otherwise eligible loan terminates on the earliest of— (i) The date the borrower's loan is repaid; (ii) The date the disbursement check is returned uncashed to the lender, or the 120th day after the date of that disbursement if— (A) The check for the disbursement has not been cashed on or before that date; or (B) The proceeds of the disbursement made by electronic funds transfer or master check have not been released from the account maintained by the school on or before that date; (iii) The date of default by the borrower; (iv) The date the lender receives payment of a claim for loss on the loan; (v) The date the borrower's loan is discharged in bankruptcy; (vi) The date the lender determines that the borrower has died or has become totally and permanently disabled; (v… | ||||
| 34:34:4.1.1.1.2.3.1.2 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | C | Subpart C—Federal Payments of Interest and Special Allowance | § 682.301 Eligibility of borrowers for interest benefits on Stafford and Consolidation loans. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9120, Feb. 19, 1993; 59 FR 33352, June 28, 1994; 64 FR 18978, Apr. 16, 1999; 64 FR 58959, Nov. 1, 1999; 78 FR 65813, Nov. 1, 2013; 85 FR 49821, Aug. 14, 2020] | (a) General. (1) To qualify for benefits on a Stafford loan, a borrower must demonstrate financial need in accordance with Part F of the Act. (2) A Consolidation loan borrower qualifies for interest benefits during authorized periods of deferment on the portion of the loan that does not represent HEAL loans if the loan application was received by the lender— (i) On or after January 1, 1993 but prior to August 10, 1993; (ii) On or after August 10, 1993, but prior to November 13, 1997 if the loan consolidates only subsidized Stafford loans; and (iii) On or after November 13, 1997, for the portion of the loan that repaid subsidized FFEL loans and Direct Subsidized Loans. (b) Application for interest benefits. To apply for interest benefits on a Stafford loan, the student, or the school at the direction of the student, must submit a statement to the lender pursuant to § 682.603. The student must qualify for interest benefits if the eligible institution has determined and documented the student's amount of need for a loan based on the student's estimated cost of attendance, estimated financial assistance, and expected family contribution as determined under part F of the Act. | ||||
| 34:34:4.1.1.1.2.3.1.3 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | C | Subpart C—Federal Payments of Interest and Special Allowance | § 682.302 Payment of special allowance on FFEL loans. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 25746, May 17, 1994; 59 FR 33353, June 28, 1994; 59 FR 61428, Nov. 30, 1994; 64 FR 18978, Apr. 16, 1999; 64 FR 58626, Oct. 29, 1999; 66 FR 34763, June 29, 2001; 68 FR 75429, Dec. 31, 2003; 71 FR 45703, Aug. 9, 2006; 71 FR 64398, Nov. 1, 2006; 72 FR 62002, Nov. 1, 2007; 73 FR 63252, Oct. 23, 2008; 74 FR 55996, Oct. 29, 2009; 78 FR 65813, Nov. 1, 2013] | (a) General. The Secretary pays a special allowance to a lender on an eligible FFEL loan. The special allowance is a percentage of the average unpaid principal balance of a loan, including capitalized interest computed in accordance with paragraphs (c) and (f) of this section. Special allowance is also paid on the unpaid accrued interest of a loan covered by § 682.215(b)(7) computed in the same manner as in paragraphs (c) and (f), as applicable, except for this purpose the applicable interest rate shall be deemed to be zero. (b) Eligible loans. (1) Except for non-subsidized Federal Stafford loans disbursed on or after October 1, 1981, for periods of enrollment beginning prior to October 1, 1992, or as provided in paragraphs (b)(2), (b)(3), or (e)(1) of this section, FFEL loans that otherwise meet program requirements are eligible for special allowance payments. (2) For a loan made under the Federal SLS or Federal PLUS Program on or after July 1, 1987 and prior to July 1, 1994, and for any Federal PLUS loan made on or after July 1, 1998 or on or after January 1, 2000 for any period prior to April 1, 2006, or under § 682.209(e) or (f), no special allowance is paid for any period for which the interest rate calculated prior to applying the interest rate maximum for that loan does not exceed— (i) 12 percent in the case of a Federal SLS or PLUS loan made prior to October 1, 1992; (ii) 11 percent in the case of a Federal SLS loan made on or after October 1, 1992; (iii) 10 percent in the case of a Federal PLUS loan made on or after October 1, 1992; or (iv) 9 percent in the case of a Federal PLUS loan made on or after July 1, 1998. (3) In the case of a subsidized Stafford loan disbursed on or after October 1, 1992 and prior to July 1, 2010, the Secretary does not pay special allowance on a disbursement if— (i) The disbursement check is returned uncashed to the lender or the lender is notified that the disbursement made by electronic funds transfer or master check will not be released from the restricted accou… | ||||
| 34:34:4.1.1.1.2.3.1.4 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | C | Subpart C—Federal Payments of Interest and Special Allowance | § 682.303 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.3.1.5 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | C | Subpart C—Federal Payments of Interest and Special Allowance | § 682.304 Methods for computing interest benefits and special allowance. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 73 FR 63254, Oct. 23, 2008] | (a) General. The Secretary pays a lender interest benefits and special allowance on eligible loans on a quarterly basis. These calendar quarters end on March 31, June 30, September 30, and December 31 of each year. A lender may use either the average daily balance method or the actual accrual method to determine the amount of interest benefits payable on a lender's loans. A lender shall use the average daily balance method to determine the balance on which the Secretary computes the amount of special allowance payable on its loans. (b) Average daily balance method for interest benefits. (1) Under this method, the lender adds the unpaid principal balance outstanding on all loans qualifying for interest benefits at each actual interest rate for each day of the quarter, divides the sum by the number of days in the quarter, and rounds the result to the nearest whole dollar. The resulting figure is the average daily balance for qualified loans outstanding at each actual interest rate. (2) The Secretary computes the interest benefits due on all qualified loans at each actual interest rate by multiplying the average daily balance thereof by the actual interest rate, multiplying this result by the number of days in the quarter, and then dividing this result by the actual number of days in the year. (c) Actual accrual method for interest benefits. (1) Under this method, the lender computes the total unpaid principal balance outstanding on all qualified loans at each actual interest rate on each day of the quarter, multiplies this result by the actual interest rate, and divides this result by the actual number of days in the year, or, alternatively, 365.25 days. A lender who chooses to divide by 365.25 days must do so for four consecutive years. (2) The interest benefits due for a quarter equal the sum of the daily interest benefits due, computed under paragraph (c)(1) of this section, for each day of the quarter. (d) Average daily balance method for special allowance. (1) To compute the average daily balance … | ||||
| 34:34:4.1.1.1.2.3.1.6 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | C | Subpart C—Federal Payments of Interest and Special Allowance | § 682.305 Procedures for payment of interest benefits and special allowance and collection of origination and loan fees. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 59 FR 61428, Nov. 30, 1994; 60 FR 31411, June 15, 1995; 64 FR 18978, Apr. 16, 1999; 64 FR 58627, Oct. 29, 1999; 71 FR 45705, Aug. 9, 2006; 71 FR 64398, Nov. 1, 2006; 72 FR 62003, Nov. 1, 2007; 74 FR 55996, Oct. 29, 2009; 78 FR 65814, Nov. 1, 2013; 79 FR 76105, Dec. 19, 2014] | (a) General. (1) If a lender owes origination fees or loan fees under paragraph (a) of this section, it must submit quarterly reports to the Secretary on a form provided or prescribed by the Secretary, even if the lender is not owed, or does not wish to receive, interest benefits or special allowance from the Secretary. (2) The lender shall report, on the quarterly report required by paragraph (a)(1) of this section, the amount of origination fees it was authorized to collect and the amount of those fees refunded to borrowers during the quarter covered by the report. (3)(i)(A) The Secretary reduces the amount of interest benefits and special allowance payable to the lender by— ( 1 ) The amount of origination fees the lender was authorized to collect during the quarter under § 682.202(c), whether or not the lender actually collected that amount; and ( 2 ) The amount of lender fees payable under paragraph (a)(3)(ii) of this section; and ( 3 ) The amount of excess interest, as calculated in accordance with paragraph (d) of this section. (B) The Secretary increases the amount of interest benefits and special allowance payable to the lender by the amount of origination fees refunded to borrowers during the quarter under § 682.202(c). (ii)(A) For any FFEL loan made on or after October 1, 1993, a lender shall pay the Secretary a loan fee equal to 0.50% of the principal amount of the loan. (B) For any FFEL loan made on or after October 1, 2007 and prior to July 1, 2010, a lender shall pay the Secretary a loan fee equal to 1.0 percent of the principal amount of the loan. (iii) The Secretary collects from an originating lender the amount of origination fees the originating lender was authorized to collect from borrowers during the quarter whether or not the originating lender actually collected those fees. The Secretary also collects the fees the originating lender is required to pay under paragraph (a)(3)(ii) of this section. Generally, the Secretary collects the fees from the originating lender by offsetting t… | ||||
| 34:34:4.1.1.1.2.4.1.1 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.400 Agreements between a guaranty agency and the Secretary. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 33353, June 28, 1994; 64 FR 18978, Apr. 16, 1999; 64 FR 58627, Oct. 29, 1999; 78 FR 65814, Nov. 1, 2013] | (a) The Secretary enters into agreements with a guaranty agency whose loan guarantee program meets the requirements of this subpart. The agreements enable the guaranty agency to participate in the FFEL programs and to receive the various payments and benefits related to that participation. (b) There are four agreements: (1) Basic program agreement. In order to participate in the FFEL programs, a guaranty agency must have a basic program agreement. Under this agreement— (i) Borrowers whose Stafford or Consolidation loans are guaranteed by the agency may qualify for interest benefits that are paid to the lender on the borrower's behalf under § 682.301; and (ii) Lenders under the guaranty agency program may receive special allowance payments from the Secretary and have death, disability, bankruptcy, closed school and false certification discharge claims paid by the Secretary through the guaranty agency. (2) Federal advances for claim payments agreement. A guaranty agency must have an agreement for Federal advances for claim payments to receive and use Federal advances to pay default claims. (3) Reinsurance agreement. A guaranty agency must have a reinsurance agreement to receive reimbursement from the Secretary for its losses on default claims. (4) Loan Rehabilitation Agreement. A guaranty agency must have an agreement for rehabilitating a loan for which the Secretary has made a reinsurance payment under section 428(c)(1) of the Act. (c) The Secretary's execution of an agreement does not indicate acceptance of any current or past standards or procedures used by the agency. (d) All of the agreements are subject to subsequent changes in the Act, in other applicable Federal statutes, and in regulations that apply to the FFEL programs. | ||||
| 34:34:4.1.1.1.2.4.1.10 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.409 Mandatory assignment by guaranty agencies of defaulted loans to the Secretary. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9120, Feb. 19, 1993; 59 FR 33356, June 28, 1994; 60 FR 30788, June 12, 1995; 64 FR 18980, Apr. 16, 1999; 64 FR 58630, Oct. 29, 1999; 64 FR 58963, Nov. 1, 1999; 72 FR 62006, Nov. 1, 2007; 78 FR 65816, Nov. 1, 2013] | (a)(1) If the Secretary determines that action is necessary to protect the Federal fiscal interest, the Secretary directs a guaranty agency to promptly assign to the Secretary any loans held by the agency on which the agency has received payment under § 682.402(f), 682.402(k), or 682.404. The collection of unpaid loans owed by Federal employees by Federal salary offset is, among other things, deemed to be in the Federal fiscal interest. Unless the Secretary notifies an agency, in writing, that other loans must be assigned to the Secretary, an agency must assign any loan that meets all of the following criteria as of April 15 of each year: (i) The unpaid principal balance is at least $100. (ii) For each of the two fiscal years following the fiscal year in which these regulations are effective, the loan, and any other loans held by the agency for that borrower, have been held by the agency for at least four years; for any subsequent fiscal year such loan must have been held by the agency for at least five years. (iii) A payment has not been received on the loan in the last year. (iv) A judgment has not been entered on the loan against the borrower. (2) If the agency fails to meet a fiscal year recovery rate standard under paragraph (a)(2)(ii) of this section for a loan type, and the Secretary determines that additional assignments are necessary to protect the Federal fiscal interest, the Secretary may require the agency to assign in addition to those loans described in paragraph (a)(1) of this section, loans in amounts needed to satisfy the requirements of paragraph (a)(2)(iii) or (a)(3)(i) of this section. (i) Calculation of fiscal year loan type recovery rate. A fiscal year loan type recovery rate for an agency is determined by dividing the amount collected on defaulted loans, including collections by Federal Income Tax Refund Offset, for each loan program (i.e., the Stafford, PLUS, SLS, and Consolidation loan programs) by the agency for loans of that program (including payments received by the agency on … | ||||
| 34:34:4.1.1.1.2.4.1.11 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.410 Fiscal, administrative, and enforcement requirements. | ED | [57 FR 60323, Dec. 18, 1992] | (a) Fiscal requirements —(1) Reserve fund assets. A guaranty agency shall establish and maintain a reserve fund to be used solely for its activities as a guaranty agency under the FFEL Program (“guaranty activities”). The guaranty agency shall credit to the reserve fund— (i) The total amount of insurance premiums and Federal default fees collected; (ii) Funds received from a State for the agency's guaranty activities, including matching funds under section 422(a) of the Act; (iii) Federal advances obtained under sections 422(a) and (c) of the Act; (iv) Federal payments for default, bankruptcy, death, disability, closed schools, and false certification claims; (v) Supplemental preclaims assistance payments; (vi) Transitional support payments received under section 458(a) of the Act; (vii) Funds collected by the guaranty agency on FFEL Program loans on which a claim has been paid; (viii) Investment earnings on the reserve fund; and (ix) Other funds received by the guaranty agency from any source for the agency's guaranty activities. (2) Uses of reserve fund assets. A guaranty agency may use the assets of the reserve fund established under paragraph (a)(1) of this section to pay only— (i) Insurance claims; (ii) Costs that are reasonable, as defined under § 682.410(a)(11)(iii), and that are ordinary and necessary for the agency to fulfill its responsibilities under the HEA, including costs of collecting loans, providing default aversion assistance, monitoring enrollment and repayment status, and carrying out any other guaranty activities. Those costs must be— (A) Allocable to the FFEL Program; (B) Not higher than the agency would incur under established policies, regulations, and procedures that apply to any comparable non-Federal activities of the guaranty agency; (C) Not included as a cost or used to meet cost sharing or matching requirements of any other federally supported activity, except as specifically provided by Federal law; (D) Net of all applicable credits; and (E) Documented in accor… | ||||
| 34:34:4.1.1.1.2.4.1.12 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.411 Lender due diligence in collecting guaranty agency loans. | ED | [64 FR 58630, Oct. 29, 1999, as amended at 64 FR 58965, Nov. 1, 1999; 72 FR 62006, Nov. 1, 2007; 73 FR 63254, Oct. 23, 2008; 78 FR 65820, Nov. 1, 2013] | (a) General. In the event of delinquency on an FFEL Program loan, the lender must engage in at least the collection efforts described in paragraphs (c) through (n) of this section, except that in the case of a loan made to a borrower who is incarcerated, residing outside a State, Mexico, or Canada, or whose telephone number is unknown, the lender may send a forceful collection letter instead of each telephone effort required by this section. (b) Delinquency. (1) For purposes of this section, delinquency on a loan begins on the first day after the due date of the first missed payment that is not later made. The due date of the first payment is established by the lender but must occur by the deadlines specified in § 682.209(a) or, if the lender first learns after the fact that the borrower has entered the repayment period, no later than 75 days after the day the lender so learns, except as provided in § 682.209(a)(2)(v) and (a)(3)(ii)(E). If a payment is made late, the first day of delinquency is the day after the due date of the next missed payment that is not later made. A payment that is within five dollars of the amount normally required to advance the due date may nevertheless advance the due date if the lender's procedures allow for that advancement. (2) At no point during the periods specified in paragraphs (c), (d), and (e) of this section may the lender permit the occurrence of a gap in collection activity, as defined in paragraph (j) of this section, of more than 45 days (60 days in the case of a transfer). (3) As part of one of the collection activities provided for in this section, the lender must provide the borrower with information on the availability of the Student Loan Ombudsman's office. (c) 1-15 days delinquent. Except in the case in which a loan is brought into this period by a payment on the loan, expiration of an authorized deferment or forbearance period, or the lender's receipt from the drawee of a dishonored check submitted as a payment on the loan, the lender during this period m… | ||||
| 34:34:4.1.1.1.2.4.1.13 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.412 Consequences of the failure of a borrower or student to establish eligibility. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9120, Feb. 19, 1993; 60 FR 61757, Dec. 1, 1995; 64 FR 58632, Oct. 29, 1999; 78 FR 65820, Nov. 1, 2013] | (a) The lender shall immediately send to the borrower a final demand letter meeting the requirements of § 682.411(f) when it learns and can substantiate that the borrower or the student on whose behalf a parent has borrowed, without the lender or school's knowledge at the time the loan was made, provided false or erroneous information or took actions that caused the student or borrower— (1) To be ineligible for all or a portion of a loan made under this part; (2) To receive a Stafford loan subject to payment of Federal interest benefits for which he or she was ineligible; or (3) To receive loan proceeds for a period of enrollment from which he or she has withdrawn or been expelled prior to the first day of classes or during which he or she failed to attend school and has not paid those funds to the school or repaid them to the lender. (b) The lender shall neither bill the Secretary for nor be entitled to interest benefits on a loan after it learns that one of the conditions described in paragraph (a) of this section exists with respect to the loan. (c) In the final demand letter transmitted under paragraph (a) of this section, the lender shall demand that within 30 days from the date the letter is mailed the borrower repay in full any principal amount for which the borrower is ineligible and any accrued interest, including interest and all special allowance paid by the Secretary. (d) If the borrower repays the amounts described in paragraph (c) of this section within the 30-day period, the lender shall— (1) On its next quarterly interest billing submitted under § 682.305, refund to the Secretary the interest benefits and special allowance repaid by the borrower and all other interest benefits and special allowance previously paid by the Secretary on the ineligible portion of the loan; and (2) Treat that payment of the principal amount of the ineligible portion of the loan as a prepayment of principal. (e) If a borrower fails to comply with the terms of a final demand letter described in paragraph (a) of … | ||||
| 34:34:4.1.1.1.2.4.1.14 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.413 Remedial actions. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22454, Apr. 29, 1994; 59 FR 61190, Nov. 29, 1994; 61 FR 60487, Nov. 27, 1996; 64 FR 18981, Apr. 16, 1999; 64 FR 58632, Oct. 29, 1999; 72 FR 62006, Nov. 1, 2007; 78 FR 65820, Nov. 1, 2013] | (a)(1) The Secretary requires a lender and its third-party servicer administering any aspect of the FFEL programs under a contract with the lender to repay interest benefits and special allowance or other compensation received on a loan guaranteed by a guaranty agency, pursuant to paragraph (a)(2) of this section— (i) For any period beginning on the date of a failure by the lender or servicer, with respect to the loan, to comply with any of the requirements set forth in § 682.406(a)(1)-(a)(6), (a)(9), and (a)(12); (ii) For any period beginning on the date of a failure by the lender or servicer, with respect to the loan, to meet a condition of guarantee coverage established by the guaranty agency, to the date, if any, on which the guaranty agency reinstated the guarantee coverage pursuant to policies and procedures established by the agency; (iii) For any period in which the lender or servicer, with respect to the loan, violates the requirements of subpart C of this part; and (iv) For any period beginning on the day after the Secretary's obligation to pay special allowance on the loan terminates under § 682.302(d). (2) For purposes of this section, a lender and any applicable third-party servicer shall be considered jointly and severally liable for the repayment of any interest benefits and special allowance paid as a result of a violation of applicable requirements by the servicer in administering the lender's FFEL programs. (3) For purposes of paragraph (a)(2) of this section, the relevant third-party servicer shall repay any outstanding liabilities under paragraph (a)(2) of this section only if— (i) The Secretary has determined that the servicer is jointly and severally liable for the liabilities; and (ii) (A) The lender has not repaid in full the amount of the liability within 30 days from the date the lender receives notice from the Secretary of the liability; (B) The lender has not made other satisfactory arrangements to pay the amount of the liability within 30 days from the date the lender receive… | ||||
| 34:34:4.1.1.1.2.4.1.15 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.414 Records, reports, and inspection requirements for guaranty agency programs. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9120, Feb. 19, 1993; 59 FR 22455, 22489, Apr. 29, 1994; 59 FR 33358, June 28, 1994; 59 FR 34964, July 7, 1994; 61 FR 60493, Nov. 27, 1996; 64 FR 58632, Oct. 29, 1999; 64 FR 58963, Nov. 1, 1999; 65 FR 65621, Nov. 1, 2000; 66 FR 34764, June 29, 2001; 67 FR 67080, Nov. 1, 2002; 72 FR 62007, Nov. 1, 2007; 78 FR 65820, Nov. 1, 2013; 87 FR 66054, Nov. 1, 2022] | (a) Records. (1)(i) The guaranty agency shall maintain current, complete, and accurate records of each loan that it holds, including, but not limited to, the records described in paragraph (a)(1)(ii) of this section. The records must be maintained in a system that allows ready identification of each loan's current status, updated at least once every 10 business days. Any reference to a guaranty agency under this section includes a third-party servicer that administers any aspect of the FFEL programs under a contract with the guaranty agency, if applicable. (ii) The agency shall maintain— (A) All documentation supporting the claim filed by the lender; (B) Notices of changes in a borrower's address; (C) A payment history showing the date and amount of each payment received from or on behalf of the borrower by the guaranty agency, and the amount of each payment that was attributed to principal, accrued interest, and collection costs and other charges, such as late charges; (D) A collection history showing the date and subject of each communication between the agency and the borrower or endorser relating to collection of a defaulted loan, each communication between the agency and a consumer reporting agency regarding the loan, each effort to locate a borrower whose address was unknown at any time, and each request by the lender for default aversion assistance on the loan; (E) Documentation regarding any wage garnishment actions initiated by the agency on the loan; (F) Documentation of any matters relating to the collection of the loan by tax-refund offset; and (G) Any additional records that are necessary to document its right to receive or retain payments made by the Secretary under this part and the accuracy of reports it submits to the Secretary. (2) A guaranty agency must retain the records required for each loan for not less than 3 years following the date the loan is repaid in full by the borrower, or for not less than 5 years following the date the agency receives payment in full from any other sour… | ||||
| 34:34:4.1.1.1.2.4.1.16 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.415 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.4.1.17 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.416 Requirements for third-party servicers and lenders contracting with third-party servicers. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22455, Apr. 29, 1994; 59 FR 34964, July 7, 1994; 66 FR 34764, June 29, 2001; 68 FR 66615, Nov. 26, 2003; 77 FR 18679, Mar. 28, 2012; 78 FR 65820, Nov. 1, 2013; 79 FR 76105, Dec. 19, 2014] | (a) Standards for administrative capability. A third-party servicer is considered administratively responsible if it— (1) Provides the services and administrative resources necessary to fulfill its contract with a lender or guaranty agency, and conducts all of its contractual obligations that apply to the FFEL programs in accordance with FFEL programs regulations; (2) Has business systems including combined automated and manual systems, that are capable of meeting the requirements of part B of Title IV of the Act and with the FFEL programs regulations; and (3) Has adequate personnel who are knowledgeable about the FFEL programs. (b) Standards of financial responsibility. The Secretary applies the provisions of 34 CFR 668.15(b) (1)-(4) and (6)-(9) to determine that a third-party servicer is financially responsible under this part. References to “the institution” in those provisions shall be understood to mean the third-party servicer, for this purpose. (c) Special review of third-party servicer. (1) The Secretary may review a third-party servicer to determine that it meets the administrative capability and financial responsibility standards in this section. (2) In response to a request from the Secretary, the servicer shall provide evidence to demonstrate that it meets the administrative capability and financial responsibility standards in this section. (3) The servicer may also provide evidence of why administrative action is unwarranted if it is unable to demonstrate that it meets the standards of this section. (4) Based on the review of the materials provided by the servicer, the Secretary determines if the servicer meets the standards in this part. If the servicer does not, the Secretary may initiate an administrative proceeding under subpart G. (d) Past performance of third-party servicer or persons affiliated with servicer. Notwithstanding paragraphs (b) and (c) of this section, a third-party servicer is not financially responsible if— (1)(i) The servicer; its owner, majority shareholder, o… | ||||
| 34:34:4.1.1.1.2.4.1.18 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.417 Determination of Federal funds or assets to be returned. | ED | [64 FR 58632, Oct. 29, 1999] | (a) General. The procedures described in this section apply to a determination by the Secretary that— (1) A guaranty agency must return to the Secretary a portion of its Federal Fund that the Secretary has determined is unnecessary to pay the program expenses and contingent liabilities of the agency; and (2) A guaranty agency must require the return to the agency or the Secretary of Federal funds or assets within the meaning of section 422(g)(1) of the Act held by or under the control of any other entity that the Secretary determines are necessary to pay the program expenses and contingent liabilities of the agency or that are required for the orderly termination of the guaranty agency's operations and the liquidation of its assets. (b) Return of unnecessary Federal funds. (1) The Secretary may initiate a process to recover unnecessary Federal funds under paragraph (a)(1) of this section if the Secretary determines that a guaranty agency's Federal Fund ratio under § 682.410(a)(10) for each of the two preceding Federal fiscal years exceeded 2.0 percent. (2) If the Secretary initiates a process to recover unnecessary Federal funds, the Secretary requires the return of a portion of the Federal funds that the Secretary determines will permit the agency to— (i) Have a Federal Fund ratio of at least 2.0 percent under § 682.410(a)(10) at the time of the determination; and (ii) Meet the minimum Federal Fund requirements under § 682.410(a)(10) and retain sufficient additional Federal funds to perform its responsibilities as a guaranty agency during the current Federal fiscal year and the four succeeding Federal fiscal years. (3)(i) The Secretary makes a determination of the amount of Federal funds needed by the guaranty agency under paragraph (b)(2) of this section on the basis of financial projections for the period described in that paragraph. If the agency provides projections for a period longer than the period referred to in that paragraph, the Secretary may consider those projections. (ii) The Secretary … | ||||
| 34:34:4.1.1.1.2.4.1.19 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.418 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.4.1.2 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.401 Basic program agreement. | ED | [57 FR 60323, Dec. 18, 1992] | (a) General. In order to participate in the FFEL programs, a guaranty agency shall enter into a basic agreement with the Secretary. (b) Terms of agreement. In the basic agreement, the guaranty agency shall agree to ensure that its loan guarantee program meets the following requirements at all times: (1) Reinstatement of borrower eligibility. Except as provided in § 668.35(b) for a borrower with a defaulted loan on which a judgment has been obtained and § 668.35(i) for a borrower who fraudulently obtained title IV, HEA program assistance, reinstatement of Title IV eligibility for a borrower with a defaulted loan must be in accordance with this paragraph (b)(1). For a borrower's loans held by a guaranty agency on which a reinsurance claim has been paid by the Secretary, the guaranty agency must afford a defaulted borrower, upon the borrower's request, renewed eligibility for Title IV assistance once the borrower has made satisfactory repayment arrangements as that term is defined in § 682.200. (i) For purposes of this section, the determination of reasonable and affordable must— (A) Include consideration of the borrower's and spouse's disposable income and necessary expenses including, but not limited to, housing, utilities, food, medical costs, dependent care costs, work-related expenses and other Title IV repayment; (B) Not be a required minimum payment amount, e.g. $50, if the agency determines that a smaller amount is reasonable and affordable based on the borrower's total financial circumstances. The agency must include documentation in the borrower's file of the basis for the determination, if the monthly reasonable and affordable payment established under this section is less than $50.00 or the monthly accrued interest on the loan, whichever is greater. (C) Be based on the documentation provided by the borrower or other sources including, but not limited to— ( 1 ) Evidence of current income (e.g. proof of welfare benefits, Social Security benefits, Supplemental Security Income, Workers' Compensa… | ||||
| 34:34:4.1.1.1.2.4.1.20 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.419 Guaranty agency Federal Fund. | ED | [64 FR 58634, Oct. 29, 1999, as amended at 71 FR 45708, Aug. 9, 2006; 78 FR 65820, Nov. 1, 2013] | (a) Establishment and control. A guaranty agency must establish and maintain a Federal Student Loan Reserve Fund (referred to as the “Federal Fund”) to be used only as permitted under paragraph (c) of this section. The assets of the Federal Fund and the earnings on those assets are, at all times, the property of the United States. The guaranty agency must exercise the level of care required of a fiduciary charged with the duty of protecting, investing, and administering the money of others. (b) Deposits. The agency must deposit into the Federal Fund— (1) All funds, securities, and other liquid assets of the reserve fund that existed under § 682.410; (2) The total amount of insurance premiums or Federal default fees collected; (3) Federal payments for default, bankruptcy, death, disability, closed school, false certification, and other claims; (4) Federal payments for supplemental preclaims assistance activities performed before October 1, 1998; (5) 70 percent of administrative cost allowances received on or after October 1, 1998 for loans upon which insurance was issued before October 1, 1998; (6) All funds received by the guaranty agency from any source on FFEL Program loans on which a claim has been paid, within 48 hours of receipt of those funds, minus the portion the agency is authorized to deposit in its Operating Fund; (7) Investment earnings on the Federal Fund; (8) Revenue derived from the Federal portion of a nonliquid asset; and (9) Other funds received by the guaranty agency from any source that are specifically designated for deposit in the Federal Fund. (c) Uses. A guaranty agency may use the assets of the Federal Fund only— (1) To pay insurance claims; (2) To transfer default aversion fees to the agency's Operating Fund; (3) To transfer account maintenance fees to the agency's Operating Fund, if directed by the Secretary; (4) To refund payments made by or on behalf of a borrower on a loan that has been discharged in accordance with § 682.402; (5) To pay the Secretary's share of… | ||||
| 34:34:4.1.1.1.2.4.1.21 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | §§ 682.420-682.422 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.4.1.22 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.423 Guaranty agency Operating Fund. | ED | [64 FR 58635, Oct. 29, 1999, as amended at 78 FR 65820, Nov. 1, 2013] | (a) Establishment and control. A guaranty agency must establish and maintain an Operating Fund in an account separate from the Federal Fund. Except for funds that may have been transferred from the Federal Fund, the Operating Fund is considered the property of the guaranty agency. (b) Deposits. The guaranty agency must deposit into the Operating Fund— (1) Amounts authorized by the Secretary to be transferred from the Federal Fund; (2) Account maintenance fees; (3) Loan processing and issuance fees; (4) Default aversion fees; (5) 30 percent of administrative cost allowances received on or after October 1, 1998 for loans upon which insurance was issued before October 1, 1998; (6) The portion of the amounts collected on defaulted loans that remains after the Secretary's share of collections has been paid and the complement of the reinsurance percentage has been deposited into the Federal Fund; (7) The agency's share of the payoff amounts received from the consolidation or rehabilitation of defaulted loans; and (8) Other receipts as authorized by the Secretary. (c) Uses. A guaranty agency may use the Operating Fund for— (1) Guaranty agency-related activities, including— (i) Application processing; (ii) Loan disbursement; (iii) Enrollment and repayment status management; (iv) Default aversion activities; (v) Default collection activities; (vi) School and lender training; (vii) Financial aid awareness and related outreach activities; and (viii) Compliance monitoring; and (2) Other student financial aid-related activities for the benefit of students, as selected by the guaranty agency. | ||||
| 34:34:4.1.1.1.2.4.1.23 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.424 Severability. | ED | [87 FR 66055, Nov. 1, 2022] | If any provision of this subpart or its application to any person, act, or practice is held invalid, the remainder of the subpart or the application of its provisions to any person, act, or practice will not be affected thereby. | ||||
| 34:34:4.1.1.1.2.4.1.3 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.402 Death, disability, closed school, false certification, unpaid refunds, and bankruptcy payments. | ED | [57 FR 60323, Dec. 18, 1992] | (a) General. (1) Rules governing the payment of claims based on filing for relief in bankruptcy, and discharge of loans due to death, total and permanent disability, attendance at a school that closes, false certification by a school of a borrower's eligibility for a loan, and unpaid refunds by a school are set forth in this section. (2) If a Consolidation loan was obtained jointly by a married couple, the amount of the Consolidation loan that is discharged if one of the borrowers dies or becomes totally and permanently disabled is equal to the portion of the outstanding balance of the Consolidation loan, as of the date the borrower died or became totally and permanently disabled, attributable to any of that borrower's loans that would have been eligible for discharge. (3) If a PLUS loan was obtained by two parents as co-makers, and only one of the borrowers dies, becomes totally and permanently disabled, has collection of his or her loan obligation stayed by a bankruptcy filing, or has that obligation discharged in bankruptcy, the other borrower remains obligated to repay the loan unless that borrower would qualify for discharge of the loan under these regulations. (4) Except for a borrower's loan obligation discharged by the Secretary under the false certification discharge provision of paragraphs (e)(1)(ii) or (iii) of this section, a loan qualifies for payment under this section and as provided in paragraph (h)(1)(iv) of this section, only to the extent that the loan is legally enforceable under applicable law by the holder of the loan. (5) For purposes of this section— (i) The legal enforceability of a loan is conclusively determined on the basis of a ruling by a court or administrative tribunal of competent jurisdiction with respect to that loan, or a ruling with respect to another loan in a judgment that collaterally estops the holder from contesting the enforceability of the loan; (ii) A loan is conclusively determined to be legally unenforceable to the extent that the guarantor determines, pursua… | ||||
| 34:34:4.1.1.1.2.4.1.4 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.403 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.4.1.5 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.404 Federal reinsurance agreement. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 59 FR 25746, May 17, 1994; 59 FR 61429, Nov. 30, 1994; 60 FR 31411, June 15, 1995; 61 FR 60486, Nov. 27, 1996; 64 FR 18980, Apr. 16, 1999; 64 FR 58628, Oct. 29, 1999; 71 FR 45707, Aug. 9, 2006; 72 FR 62006, Nov. 1, 2007; 78 FR 65815, Nov. 1, 2013] | (a) General. (1) The Secretary may enter into a reinsurance agreement with a guaranty agency that has a basic program agreement. Except as provided in paragraph (b) of this section, under a reinsurance agreement, the Secretary reimburses the guaranty agency for— (i) 95 percent of its losses on default claim payments to lenders on loans for which the first disbursement is made on or after October 1, 1998; (ii) 98 percent of its losses on default claim payments to lenders for loans for which the first disbursement is made on or after October 1, 1993, and before October 1, 1998; or (iii) 100 percent of its losses on default claim payments to lenders— (A) For loans for which the first disbursement is made prior to October 1, 1993; (B) For loans made under an approved lender-of-last-resort program; (C) For loans transferred under a plan approved by the Secretary from an insolvent guaranty agency or a guaranty agency that withdraws its participation in the FFEL Program; (D) For loans that meet the definition of exempt claims in paragraph (a)(2)(iii) of this section; (E) For a guaranty agency that entered into a basic program agreement under section 428(b) of the Act after September 30, 1976, or was not actively carrying on a loan guarantee program covered by a basic program agreement on October 1, 1976 for five consecutive fiscal years beginning with the first year of its operation. (2) For purposes of this section— (i) Losses means the amount of unpaid principal and accrued interest the agency paid on a default claim filed by a lender on a reinsured loan, minus payments made by or on behalf of the borrower after default but before the Secretary reimburses the agency; (ii) Default aversion assistance means the activities of a guaranty agency that are designed to prevent a default by a borrower who is at least 60 days delinquent and that are directly related to providing collection assistance to the lender. (iii) Exempt claims means claims with respect to loans for which it is determined that the bor… | ||||
| 34:34:4.1.1.1.2.4.1.6 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.405 Loan rehabilitation agreement. | ED | [59 FR 33355, June 28, 1994, as amended at 60 FR 30788, June 12, 1995; 64 FR 18980, Apr. 16, 1999; 64 FR 58965, Nov. 1, 1999; 66 FR 34764, June 29, 2001; 67 FR 67080, Nov. 1, 2002; 68 FR 75429, Dec. 31, 2003; 71 FR 45707, Aug. 9, 2006; 71 FR 64398, Nov. 1, 2006; 73 FR 63254, Oct. 23, 2008; 74 FR 56000, Oct. 29, 2009; 78 FR 65815, Nov. 1, 2013; 80 FR 67237, Oct. 30, 2015; 81 FR 76080, Nov. 1, 2016] | (a) General. (1) A guaranty agency that has a basic program agreement must enter into a loan rehabilitation agreement with the Secretary. The guaranty agency must establish a loan rehabilitation program for all borrowers with an enforceable promissory note for the purpose of rehabilitating defaulted loans, except for loans for which a judgment has been obtained, loans on which a default claim was filed under § 682.412, and loans on which the borrower has been convicted of, or has pled nolo contendere or guilty to, a crime involving fraud in obtaining title IV, HEA program assistance, so that the loan may be purchased, if practicable, by an eligible lender and removed from default status. (2) A loan is considered to be rehabilitated only after— (i) The borrower has made and the guaranty agency has received nine of the ten qualifying payments required under a monthly repayment agreement. (A) A qualifying payment is— ( 1 ) Made voluntarily; ( 2 ) In the full amount required; and ( 3 ) Received within 20 days of the due date for the payment, and (B) All nine payments are received within a 10-month period that begins with the month in which the first required due date falls and ends with the ninth consecutive calendar month following that month, and (ii) The loan has been sold to an eligible lender or assigned to the Secretary. (3)(i) If a borrower's loan is being collected by administrative wage garnishment while the borrower is also making monthly payments on the same loan under a loan rehabilitation agreement, the guaranty agency must continue collecting the loan by administrative wage garnishment until the borrower makes five qualifying monthly payments under the rehabilitation agreement, unless the guaranty agency is otherwise precluded from doing so under § 682.410(b)(9). (ii) After the borrower makes the fifth qualifying monthly payment, the guaranty agency must, unless otherwise directed by the borrower, suspend the garnishment order issued to the borrower's employer. (iii) A borrower may only obt… | ||||
| 34:34:4.1.1.1.2.4.1.7 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.406 Conditions for claim payments from the Federal Fund and for reinsurance coverage. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 59 FR 25746, May 17, 1994; 59 FR 33356, June 28, 1994; 59 FR 61429, Nov. 30, 1994; 61 FR 60486, Nov. 27, 1996; 64 FR 18980, Apr. 16, 1999; 64 FR 58629, Oct. 29, 1999; 64 FR 58963, Nov. 1, 1999; 65 FR 65620, Nov. 1, 2000; 66 FR 34764, June 29, 2001; 71 FR 45708, Aug. 9, 2006; 72 FR 62006, Nov. 1, 2007; 78 FR 65816, Nov. 1, 2013] | (a) A guaranty agency may make a claim payment from the Federal Fund and receive a reinsurance payment on a loan only if— (1) The lender exercised due diligence in making, disbursing, and servicing the loan as prescribed by the rules of the agency; (2) With respect to the reinsurance payment on the portion of a loan represented by a single disbursement of loan proceeds— (i) The check for the disbursement was cashed within 120 days after disbursement; or (ii) The proceeds of the disbursement made by electronic funds transfer or master check have been released from the restricted account maintained by the school within 120 days after disbursement; (3) The lender provided an accurate collection history and an accurate payment history to the guaranty agency with the default claim filed on the loan showing that the lender exercised due diligence in collecting the loan through collection efforts meeting the requirements of § 682.411, including collection efforts against each endorser; (4) The loan was in default before the agency paid a default claim filed thereon; (5) The lender filed a default claim thereon with the guaranty agency within 90 days of default; (6) The lender resubmitted a properly documented default claim to the guaranty agency not later than 60 days from the date the agency had returned that claim due solely to inadequate documentation, except that interest accruing beyond the 30th day after the date the guaranty agency returned the claim is not reinsured unless the lender files a claim for loss on the loan with the guarantor together with all required documentation, prior to the 30th day; (7) The lender satisfied all conditions of guarantee coverage set by the agency, unless the agency reinstated guarantee coverage on the loan following the lender's failure to satisfy such a condition pursuant to written policies and procedures established by the agency; (8) The agency paid or returned to the lender for additional documentation a default claim thereon filed by the lender within 90 days of t… | ||||
| 34:34:4.1.1.1.2.4.1.8 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.407 Discharge of student loan indebtedness for survivors of victims of the September 11, 2001, attacks. | ED | [71 FR 78080, Dec. 28, 2006, as amended at 72 FR 55053, Sept. 28, 2007; 78 FR 65816, Nov. 1, 2013] | (a) Definition of terms. As used in this section— (1) Eligible public servant means an individual who— (i) Served as a police officer, firefighter, other safety or rescue personnel, or as a member of the Armed Forces; and (ii)(A) Died due to injuries suffered in the terrorist attacks on September 11, 2001; or (B) Became permanently and totally disabled due to injuries suffered in the terrorist attacks on September 11, 2001. (2) Eligible victim means an individual who died due to injuries suffered in the terrorist attacks on September 11, 2001 or became permanently and totally disabled due to injuries suffered in the terrorist attacks on September 11, 2001. (3) Eligible parent means the parent of an eligible victim if— (i) The parent owes a FFEL PLUS Loan incurred on behalf of an eligible victim; or (ii) The parent owes a FFEL Consolidation Loan that was used to repay a FFEL or Direct Loan PLUS Loan incurred on behalf of an eligible victim. (4) Died due to injuries suffered in the terrorist attacks on September 11, 2001 means the individual was present at the World Trade Center in New York City, New York, at the Pentagon in Virginia, or at the Shanksville, Pennsylvania site at the time of or in the immediate aftermath of the terrorist-related aircraft crashes on September 11, 2001, and the individual died as a direct result of these crashes. (5) Became permanently and totally disabled due to injuries suffered in the terrorist attacks on September 11, 2001 means the individual was present at the World Trade Center in New York City, New York, at the Pentagon in Virginia, or at the Shanksville, Pennsylvania site at the time of or in the immediate aftermath of the terrorist-related aircraft crashes on September 11, 2001 and the individual became permanently and totally disabled as a direct result of these crashes. (i) An individual is considered permanently and totally disabled if— (A) The disability is the result of a physical injury to the individual that was treated by a medical professional… | ||||
| 34:34:4.1.1.1.2.4.1.9 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | D | Subpart D—Administration of the Federal Family Education Loan Programs by a Guaranty Agency | § 682.408 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.6.1.1 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | §§ 682.600-682.602 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.6.1.10 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.611 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.6.1.2 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.603 Certification by a school that participated in the FFEL Program in connection with a loan application. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9120, Feb. 19, 1993; 59 FR 33358, June 28, 1994; 59 FR 61722, Dec. 1, 1994; 60 FR 61757, Dec. 1, 1995; 61 FR 60609, Nov. 29, 1996; 64 FR 18981, Apr. 16, 1999; 64 FR 58963, Nov. 1, 1999; 65 FR 65650, Nov. 1, 2000; 66 FR 34764, June 29, 2001; 67 FR 67080, Nov. 1, 2002; 68 FR 75429, Dec. 31, 2003; 71 FR 45709, Aug. 9, 2006; 72 FR 62007, 62031, Nov. 1, 2007; 78 FR 65820, Nov. 1, 2013] | (a) A school shall certify that the information it provides in connection with a loan application about the borrower and, in the case of a parent borrower, the student for whom the loan is intended, is complete and accurate. Except as provided in 34 CFR part 668, subpart E, a school may rely in good faith upon statements made by the borrower and, in the case of a parent borrower of a PLUS loan, the student and the parent borrower. (b) The information to be provided by the school about the borrower pertains to— (1) The borrower's eligibility for a loan, as determined in accordance with §§ 682.201 and 682.204; (2) For a subsidized Stafford loan, the student's eligibility for interest benefits as determined in accordance with § 682.301; and (3) The schedule for disbursement of the loan proceeds, which must reflect the delivery of the loan proceeds as set forth in section 428G of the Act. (c) Except as provided in paragraph (e) of this section, in certifying a loan, a school must certify a loan for the lesser of the borrower's request or the loan limits determined under § 682.204. (d) Before certifying a PLUS loan application for a graduate or professional student borrower, the school must determine the borrower's eligibility for a Stafford loan. If the borrower is eligible for a Stafford loan but has not requested the maximum Stafford loan amount for which the borrower is eligible, the school must— (1) Notify the graduate or professional student borrower of the maximum Stafford loan amount that he or she is eligible to receive and provide the borrower with a comparison of— (i) The maximum interest rate for a Stafford loan and the maximum interest rate for a PLUS loan; (ii) Periods when interest accrues on a Stafford loan and periods when interest accrues on a PLUS loan; and (iii) The point at which a Stafford loan enters repayment and the point at which a PLUS loan enters repayment; and (2) Give the graduate or professional student borrower the opportunity to request the maximum Stafford loan amount for w… | ||||
| 34:34:4.1.1.1.2.6.1.3 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.604 Required exit counseling for borrowers. | ED | [57 FR 60323, Dec. 18, 1992] | (a) Exit counseling. (1) A school must ensure that exit counseling is conducted with each Stafford Loan borrower and graduate or professional student PLUS Loan borrower either in person, by audiovisual presentation, or by interactive electronic means. In each case, the school must ensure that this counseling is conducted shortly before the student borrower ceases at least half-time study at the school, and that an individual with expertise in the title IV programs is reasonably available shortly after the counseling to answer the student borrower's questions. As an alternative, in the case of a student borrower enrolled in a correspondence program or a study-abroad program that the home institution approves for credit, written counseling materials may be provided by mail within 30 days after the student borrower completes the program. If a student borrower withdraws from school without the school's prior knowledge or fails to complete an exit counseling session as required, the school must, within 30 days after learning that the student borrower has withdrawn from school or failed to complete the exit counseling as required, ensure that exit counseling is provided through interactive electronic means, by mailing written counseling materials to the student borrower at the student borrower's last known address, or by sending written counseling materials to an email address provided by the student borrower that is not an email address associated with the school sending the counseling materials. (2) The exit counseling must— (i) Inform the student borrower of the average anticipated monthly repayment amount based on the student borrower's indebtedness or on the average indebtedness of student borrowers who have obtained Stafford loans, PLUS Loans, or student borrowers who have obtained both Stafford and PLUS loans, depending on the types of loans the student borrower has obtained, for attendance at the same school or in the same program of study at the same school; (ii) Review for the student borrower available … | ||||
| 34:34:4.1.1.1.2.6.1.4 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.605 Determining the date of a student's withdrawal. | ED | [60 FR 61757, Dec. 1, 1995, as amended at 64 FR 58965, 59043, Nov. 1, 1999; 78 FR 65822, Nov. 1, 2013] | (a) Except in the case of a student who does not return for the next scheduled term following a summer break, which includes any summer term or terms in which classes are offered but students are not generally required to attend, a school must follow the procedures in § 668.22(b) or (c), as applicable, for determining the student's date of withdrawal. In the case of a student who does not return from a summer break, the school must follow the procedures in § 668.22(b) or (c), as applicable, except that the school shall determine the student's withdrawal date no later than 30 days after the first day of the next scheduled term. (b) The school must use the withdrawal date determined under § 668.22(b) or (c), as applicable for the purpose of reporting to the lender and the Secretary the date that the student has withdrawn from the school. (c) For the purpose of a school's reporting to a lender and the Secretary, a student's withdrawal date is the month, day and year of the withdrawal date. | ||||
| 34:34:4.1.1.1.2.6.1.5 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.606 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.6.1.6 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.607 Payment of a refund or a return of title IV, HEA program funds to a lender upon a student's withdrawal. | ED | [64 FR 59043, Nov. 1, 1999] | (a) General. By applying for a FFEL loan, a borrower authorizes the school to pay directly to the lender that portion of a refund or return of title IV, HEA program funds from the school that is allocable to the loan upon the borrower's withdrawal. A school— (1) Must pay that portion of the student's refund or return of title IV, HEA program funds that is allocable to a FFEL loan to— (i) The original lender; or (ii) A subsequent holder, if the loan has been transferred and the school knows the new holder's identity; and (2) Must provide simultaneous written notice to the borrower if the school makes a payment of a refund or a return of title IV, HEA program funds to a lender on behalf of that student. (b) Allocation of a refund or returned title IV, HEA program funds. In determining the portion of a refund or the return of title IV, HEA program funds upon a student's withdrawal for an academic period that is allocable to a FFEL loan received by the borrower for that academic period, the school must follow the procedures established in part 668 for allocating a refund or return of title IV, HEA program funds. (c) Timely payment. A school must pay a refund or a return of title IV, HEA program funds that is due in accordance with the timeframe in § 668.22(j). | ||||
| 34:34:4.1.1.1.2.6.1.7 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.608 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.6.1.8 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.609 Remedial actions. | ED | (a) The Secretary may require a school to repay funds paid to other program participants by the Secretary. The Secretary also may require a school to purchase from the holder of a FFEL loan that portion of the loan that is unenforceable, that the borrower was ineligible to receive, or for which the borrower was ineligible to receive interest benefits contrary to the school's certification, and to make arrangements acceptable to the Secretary for reimbursement of the amounts the Secretary will be obligated to pay to program participants respecting that loan in the future. The repayment of funds and purchase of loans may be required if the Secretary determines that the payment to program participants, the unenforceability of the loan, or the disbursement of loan amounts for which the borrower was ineligible or for which the borrower was ineligible for interest benefits, resulted in whole or in part from— (1) The school's violation of a Federal statute or regulation; or (2) The school's negligent or willful false certification. (b) In requiring a school to repay funds to the Secretary or to another party or to purchase loans from a holder in connection with an audit or program review, the Secretary follows the procedures described in 34 CFR part 668, subpart H. (c) Notwithstanding paragraph (a) of this section, the Secretary may waive the right to require repayment of funds or repurchase of loans by a school if, in the Secretary's judgment, the best interest of the United States so requires. (d) The Secretary may impose a fine or take an emergency action against a school or limit, suspend, or terminate a school's participation in the FFEL programs, in accordance with 34 CFR part 668, subpart G. (e) A school shall comply with any emergency action, limitation, suspension, or termination imposed by a guaranty agency in accordance with the agency's standards and procedures. A school shall repay funds to the Secretary or other party or purchase loans from a holder if a guaranty agency determines that the school imp… | |||||
| 34:34:4.1.1.1.2.6.1.9 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | F | Subpart F—Requirements, Standards, and Payments for Schools That Participated in the FFEL Program | § 682.610 Administrative and fiscal requirements for schools that participated in the FFEL Program. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 61 FR 60493, Nov. 27, 1996; 64 FR 58965, Nov. 1, 1999; 66 FR 34764, June 29, 2001; 78 FR 65822, Nov. 1, 2013] | (a) General. Each school shall— (1) Establish and maintain proper administrative and fiscal procedures and all necessary records as set forth in the regulations in this part and in 34 CFR part 668; (2) Follow the record retention and examination provisions in this part and in 34 CFR 668.24; and (3) Submit all reports required by this part and 34 CFR part 668 to the Secretary. (b) Loan record requirements. In addition to records required by 34 CFR part 668, for each Stafford, SLS, or PLUS loan received by or on behalf of its students, a school must maintain— (1) A copy of the loan certification or data electronically submitted to the lender, that includes the amount of the loan and the period of enrollment for which the loan was intended; (2) The cost of attendance, estimated financial assistance, and estimated family contribution used to calculate the loan amount; (3) For loans delivered to the school by check, the date the school endorsed each loan check, if required; (4) The date or dates of delivery of the loan proceeds by the school to the student or to the parent borrower; (5) For loans delivered by electronic funds transfer or master check, a copy of the borrower's required written authorization, if it was not provided in the loan application or MPN, to deliver the initial and subsequent disbursements of each FFEL Program loan; and (6) Documentation of any MPN confirmation process or processes the school may have used. (c) Enrollment reporting process. (1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary— (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe specified by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date that the school discovers that— (i) A loan under title IV of the Act was made to or on behalf… | ||||
| 34:34:4.1.1.1.2.7.1.1 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.700 Purpose and scope. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22456, Apr. 29, 1994; 78 FR 65822, Nov. 1, 2013] | (a) This subpart governs the limitation, suspension, or termination by the Secretary of the eligibility of an otherwise eligible lender to participate in the FFEL programs or the eligibility of a third-party servicer to enter into a contract with an eligible lender to administer any aspect of the lender's FFEL programs. The regulations in this subpart apply to a lender or third-party servicer that violates any statutory provision governing the FFEL programs or any regulations, special arrangements, agreements, or limitations entered into under the authority of statutes applicable to Title IV of the HEA prescribed under the FFEL programs. These regulations apply to lenders that participate only in a guaranty agency program, lenders that participate in the FFEL programs, and third-party servicers that administer aspects of a lender's FFELP portfolio. These regulations also govern the Secretary's disqualification of a lender from participation in the FFEL programs under section 432(h)(2) of the Act. (b) This subpart does not apply— (1)(i) To a determination that an organization fails to meet the definition of “eligible lender” in section 435(d)(1) of the Act or the definition of “lender” in § 682.200, for any reason other than a violation of the prohibitions in section 435(d)(5) of the Act; or (ii) To a determination that an organization fails to meet the standards in § 682.416; or (2) To an administrative action by the Department of Education based on any alleged violation of— (i) The Family Educational Rights and Privacy Act of 1974 (section 438 of the General Education Provisions Act), which is governed by 34 CFR part 99; (ii) Title VI of the Civil Rights Act of 1964, which is governed by 34 CFR parts 100 and 101; (iii) Section 504 of the Rehabilitation Act of 1973 (relating to discrimination on the basis of handicap), which is governed by 34 CFR part 104; or (iv) Title IX of the Education Amendments of 1972 (relating to sex discrimination), which is governed by 34 CFR part 106. (c) This subpart does not… | ||||
| 34:34:4.1.1.1.2.7.1.10 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.709 Reimbursements, refunds, and offsets. | ED | [59 FR 22459, Apr. 29, 1994, as amended at 78 FR 65822, Nov. 1, 2013] | (a) As part of a limitation or termination proceeding, the Secretary, or a designated Departmental official, may require a lender or third-party servicer to take reasonable corrective action to remedy a violation of applicable laws, regulations, special arrangements, agreements, or limitations entered into under the authority of statutes applicable to Title IV of the HEA. (b) The corrective action may include payment to the Secretary or recipients designated by the Secretary of any funds, and any interest thereon, that the lender, or, in the case of a third-party servicer, the servicer or the lender that has a contract with a third-party servicer, improperly received, withheld, disbursed, or caused to be disbursed. A third-party servicer may be held liable up to the amounts specified in § 682.413(a)(2). (c) If a final decision requires a lender, a lender that has a contract with a third-party servicer, or a third-party servicer to reimburse or make any payment to the Secretary, the Secretary may, without further notice or opportunity for a hearing, proceed to offset or arrange for another Federal agency to offset the amount due against any interest benefits, special allowance, or other payments due to the lender, the lender that has a contract with the third-party servicer, or the third-party servicer. A third-party servicer may be held liable up to the amounts specified in § 682.413(a)(2). (d) In any action under this part based on a violation of the prohibitions in section 435(d)(5) of the Act, if the Secretary, the designated Department official, or the hearing official finds that the lender provided or offered the payments or activities described in paragraph (5)(i) of the definition of “lender” in § 682.200(b), the Secretary or the official applies a rebuttable presumption that the payments or activities were offered or provided to secure applications for FFEL loans. To reverse the presumption, the lender must present evidence that the activities or payments were provided for a reason unrelated to securin… | ||||
| 34:34:4.1.1.1.2.7.1.11 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.710 Removal of limitation. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22459, Apr. 29, 1994] | (a) A lender or third-party servicer may request removal of a limitation imposed by the Secretary in accordance with the regulations in this subpart at any time more than 12 months after the date the limitation becomes effective. (b) The request must be in writing and must show that the lender or servicer has corrected any violations on which the limitation was based. (c) Within 60 days after receiving the request, the Secretary— (1) Grants the request; (2) Denies the request; or (3) Grants the request subject to other limitations. (d)(1) If the Secretary denies the request or establishes other limitations, the lender or servicer, upon request, is given an opportunity to show why all limitations should be removed. (2) A lender or third-party servicer may continue to participate in the FFEL programs, subject to any limitation imposed by the Secretary under paragraph (c)(3) of this section, pending a decision by the Secretary on a request under paragraph (d)(1) of this section. | ||||
| 34:34:4.1.1.1.2.7.1.12 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.711 Reinstatement after termination. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 59 FR 22459, Apr. 29, 1994; 59 FR 34964, July 7, 1994; 60 FR 33058, June 26, 1995; 64 FR 58965, Nov. 1, 1999; 78 FR 65822, Nov. 1, 2013] | (a) A lender or third-party servicer whose eligibility has been terminated by the Secretary in accordance with the procedures of this subpart may request reinstatement of its eligibility after the later of— (1) Eighteen months from the effective date of the termination; or (2) The expiration of the period of debarment under Executive Order 12459 or the Federal Acquisition Regulation (FAR), 48 CFR part 9, subpart 9.4. (b) The request must be in writing and must show that— (1) The lender or servicer has corrected any violations on which the termination was based; and (2) The lender or servicer meets all requirements for eligibility. (c) Within 60 days after receiving a request for reinstatement, the Secretary— (1) Grants the request; (2) Denies the request; or (3) Grants the request subject to limitations. (d)(1) If the Secretary denies the lender's or servicer's request or allows reinstatement subject to limitations, the lender or servicer, upon request, is given an opportunity to show why its eligibility should be reinstated and all limitations removed. (2) A lender or third-party servicer whose eligibility to participate in the FFEL programs is reinstated subject to limitations imposed by the Secretary pursuant to paragraph (c)(3) of this section, may participate in those programs, subject to those limitations, pending a decision by the Secretary on a request under paragraph (d)(1) of this section. | ||||
| 34:34:4.1.1.1.2.7.1.13 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.712 Disqualification review of limitation, suspension, and termination actions taken by guarantee agencies against lenders. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 58 FR 9119, Feb. 19, 1993; 64 FR 58965, Nov. 1, 1999; 78 FR 65822, Nov. 1, 2013] | (a) The Secretary reviews a limitation, suspension, or termination action taken by a guaranty agency against a lender participating in the FFEL programs to determine if national disqualification is appropriate. Upon completion of the Secretary's review, the Secretary notifies the guaranty agency and the lender of the Secretary's decision by mail. (b) The Secretary disqualifies a lender from participation in the FFEL programs if— (1) The lender waives review by the Secretary; or (2) The Secretary conducts the review and determines that the limitation, suspension, or termination was imposed in accordance with section 428(b)(1)(U) of the Act. (c)(1) Disqualification by the Secretary continues until the Secretary is satisfied that— (i) The lender has corrected the failure that led to the limitation, suspension, or termination; and (ii) There are reasonable assurances that the lender will comply with the requirements of the FFEL programs in the future. (2) Revocation of disqualification by the Secretary does not remove any limitation, suspension, or termination imposed by the agency whose action resulted in the disqualification. (d) A guaranty agency shall refer a limitation, suspension, or termination action that it takes against a lender to the Secretary within 30 days of its final decision to limit, suspend, or terminate the lender's eligibility to participate in the agency's program. (e) The Secretary reviews an agency's limitation, suspension, or termination of a lender's eligibility only when the guaranty agency's action is final, e.g, the lender is not entitled to any further appeals within the guaranty agency. A subsequent court challenge to an agency's action does not by itself affect the timing of the Secretary's review. (f) The guaranty agency's notice to the Secretary regarding a termination action must include a certified copy of the administrative record compiled by the agency with regard to the action. The record must include certified copies of the following documents: (1) The guaranty agenc… | ||||
| 34:34:4.1.1.1.2.7.1.14 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.713 [Reserved] | ED | ||||||
| 34:34:4.1.1.1.2.7.1.2 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.701 Definitions of terms used in this subpart. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22457, Apr. 29, 1994; 78 FR 65822, Nov. 1, 2013] | The following definitions apply to terms used in this subpart: Designated Departmental Official: An official of the Department of Education to whom the Secretary has delegated the responsibility for initiating and pursuing disqualification or limitation, suspension, or termination proceedings. Disqualification. The removal of a lender's eligibility for an indefinite period of time by the Secretary on review of limitation, suspension, or termination action taken against the lender by a guaranty agency. Limitation. The continuation of a lender's or third-party servicer's eligibility subject to compliance with special conditions established by agreement with the Secretary or a guaranty agency, as applicable, or imposed as the result of a limitation or termination proceeding. Suspension. The removal of a lender's eligibility, or a third-party servicer's eligibility to contract with a lender or guaranty agency, for a specified period of time or until the lender or servicer fulfills certain requirements. Termination. (1) The removal of a lender's eligibility for an indefinite period of time— (i) By a guaranty agency; or (ii) By the Secretary, based on an action taken by the Secretary, or a designated Departmental official under § 682.706; or (2) The removal of a third-party servicer's eligibility to contract with a lender or guaranty agency for an indefinite period of time by the Secretary based on an action taken by the Secretary, or a designated Departmental official under § 682.706. | ||||
| 34:34:4.1.1.1.2.7.1.3 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.702 Effect on participation. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22457, Apr. 29, 1994; 78 FR 65822, Nov. 1, 2013] | (a) Limitation, suspension, or termination proceedings by the Secretary do not affect a lender's responsibilities or rights to benefits and claim payments that are based on the lender's prior participation in the program, except as provided in § 682.709. (b) A limitation imposes on a lender— (1) A limit on the number or total amount of loans that a lender may purchase or hold under the FFEL Program; or (2) Other reasonable requirements or conditions, including those described in § 682.709. (c) A limitation imposes on a third-party servicer— (1) A limit on the number of loans or accounts or total amount of loans that the servicer may service; (2) A limit on the number of loans or accounts or total amount of loans that the servicer is administering under its contract with a lender or guaranty agency; or (3) Other reasonable requirements or conditions, including those described in § 682.709. | ||||
| 34:34:4.1.1.1.2.7.1.4 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.703 Informal compliance procedure. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22457, Apr. 29, 1994] | (a) The Secretary may use the informal compliance procedure in paragraph (b) of this section if the Secretary receives a complaint or other reliable information indicating that a lender or third-party servicer may be in violation of applicable laws, regulations, special arrangements, agreements, or limitations entered into under the authority of statutes applicable to Title IV of the HEA. (b) Under the informal compliance procedure, the Secretary gives the lender or servicer a reasonable opportunity to— (1) Respond to the complaint or information; and (2) Show that the violation has been corrected or submit an acceptable plan for correcting the violation and preventing its recurrence. (c) The Secretary does not delay limitation, suspension, or termination procedures during the informal compliance procedure if— (1) The delay would harm the FFEL programs; or (2) The informal compliance procedure will not result in correction of the alleged violation. | ||||
| 34:34:4.1.1.1.2.7.1.5 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.704 Emergency action. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22457, Apr. 29, 1994; 78 FR 65822, Nov. 1, 2013] | (a) The Secretary, or a designated Departmental official, may take emergency action to withhold payment of interest benefits and special allowance to a lender if the Secretary— (1) Receives reliable information that the lender or a third-party servicer with which the lender contracts is in violation of applicable laws, regulations, special arrangements, agreements, or limitations entered into under the authority of statutes applicable to Title IV of the HEA pertaining to the lender's portfolio of loans; (2) Determines that immediate action is necessary to prevent the likelihood of substantial losses by the Federal Government, parent borrowers, or students; and (3) Determines that the likelihood of loss exceeds the importance of following the procedures for limitation, suspension, or termination. (b) The Secretary begins an emergency action by notifying the lender or third-party servicer, by certified mail, return receipt requested, of the action and the basis for the action. (c) The action becomes effective on the date the notice is mailed to the lender or third-party servicer. (d)(1) An emergency action does not exceed 30 days unless a limitation, suspension, or termination proceeding is begun before that time expires. (2) If a limitation, suspension, or termination proceeding is begun before the expiration of the 30-day period— (i) The emergency action may be extended until completion of the proceeding, including any appeal to the Secretary; and (ii) Upon the written request of the lender or third-party servicer, the Secretary may provide the lender or servicer with an opportunity to demonstrate that the emergency action is unwarranted. | ||||
| 34:34:4.1.1.1.2.7.1.6 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.705 Suspension proceedings. | ED | [59 FR 22457, Apr. 29, 1994, as amended at 60 FR 33058, June 26, 1995; 66 FR 34764, June 29, 2001; 68 FR 66615, Nov. 26, 2003; 72 FR 62009, Nov. 1, 2007; 78 FR 65822, Nov. 1, 2013] | (a) Scope. (1) A suspension by the Secretary removes a lender's eligibility under the FFEL programs or a third-party servicer's ability to enter into contracts with eligible lenders, and the Secretary does not guarantee or reinsure a new loan serviced by the servicer during a period not to exceed 60 days from the date the suspension becomes effective, unless— (i) The lender or servicer and the Secretary agree to an extension of the suspension period, if the lender or third-party servicer has not requested a hearing; or (ii) The Secretary begins a limitation or a termination proceeding. (2) If the Secretary begins a limitation or a termination proceeding before the suspension period ends, the Secretary may extend the suspension period until the completion of that proceeding, including any appeal to the Secretary. (b) Notice. (1) The Secretary, or a designated Departmental official, begins a suspension proceeding by sending the lender or servicer a notice by certified mail with return receipt requested. (2) The notice— (i) Informs the lender or servicer of the Secretary's intent to suspend the lender's or servicer's eligibility for a period not to exceed 60 days; (ii) Describes the consequences of a suspension; (iii) Identifies the alleged violations on which the proposed suspension is based; (iv) States the proposed date the suspension becomes effective, which is at least 20 days after the date of mailing of the notice; (v) Informs the lender or servicer that the suspension will not take effect on the proposed date if the Secretary receives at least five days prior to that date a request for an oral hearing or written material showing why the suspension should not take effect; and (vi) Asks the lender or servicer to correct voluntarily any alleged violations. | ||||
| 34:34:4.1.1.1.2.7.1.7 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.706 Limitation or termination proceedings. | ED | [59 FR 22458, Apr. 29, 1994, as amended at 60 FR 33058, June 25, 1995; 72 FR 62009, Nov. 1, 2007; 77 FR 18679, Mar. 28, 2012; 78 FR 65822, Nov. 1, 2013] | (a) Notice. (1) The Secretary, or a designated Departmental official, begins a limitation or termination proceeding, whether a suspension proceeding has begun, by sending the lender or third-party servicer a notice by certified mail with return receipt requested. (2) The notice— (i) Informs the lender or servicer of the Secretary's intent to limit or terminate the lender's or servicer's eligibility; (ii) Describes the consequences of a limitation or termination; (iii) Identifies the alleged violations on which the proposed limitation or termination is based; (iv) States the limits which may be imposed, in the case of a limitation proceeding; (v) States the proposed date the limitation or termination becomes effective, which is at least 20 days after the date of mailing of the notice; (vi) Informs the lender or servicer that the limitation or termination will not take effect on the proposed date if the Secretary receives, at least five days prior to that date, a request for an oral hearing or written material showing why the limitation or termination should not take effect; (vii) Asks the lender or servicer to correct voluntarily any alleged violations; and (viii) Notifies the lender or servicer that the Secretary may collect any amount owed by means of offset against amounts owed to the lender by the Department and other Federal agencies. (b) Hearing. (1) If the lender or servicer does not request an oral hearing but submits written material, the Secretary, or a designated Departmental official, considers the material and— (i) Dismisses the proposed limitation or termination; or (ii) Notifies the lender or servicer of the date the limitation or termination becomes effective. (2) If the lender or servicer requests a hearing within the time specified in paragraph (a)(2)(vi) of this section, the Secretary schedules the date and place of the hearing. The date is at least 15 days after receipt of the request from the lender or servicer. No proposed limitation or termination takes effect until a hearin… | ||||
| 34:34:4.1.1.1.2.7.1.8 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.707 Appeals in a limitation or termination proceeding. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22458, Apr. 29, 1994; 66 FR 34765, June 29, 2001] | (a) If the lender, third-party servicer, or designated Departmental official appeals the initial decision of the presiding officer in accordance with § 682.706(b)(10)— (1) An appeal is made to the Secretary by submitting to the Secretary and the opposing party within 15 days of the date of the appealing party's receipt of the presiding officer's decision, a brief or other written material explaining why the decision of the presiding officer should be overturned or modified; and (2) The opposing party shall submit its brief or other written material to the Secretary and the appealing party within 15 days of its receipt of the brief or written material of the appealing party. (b) The Secretary issues a final decision affirming, modifying, or reversing the initial decision, including a statement of the reasons for the Secretary's decision. (c) Any party submitting material to the Secretary shall provide a copy to each party that participates in the hearing. (d) If the presiding officer's initial decision would limit or terminate the lender's or servicer's eligibility, it does not take effect pending the appeal unless the Secretary determines that a stay of the date it becomes effective would seriously and adversely affect the FFEL programs or student or parent borrowers. | ||||
| 34:34:4.1.1.1.2.7.1.9 | 34 | Education | VI | 682 | PART 682—FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM | G | Subpart G—Limitation, Suspension, or Termination of Lender or Third-Party Servicer Eligibility and Disqualification of Lenders | § 682.708 Evidence of mailing and receipt dates. | ED | [57 FR 60323, Dec. 18, 1992, as amended at 59 FR 22459, Apr. 29, 1994] | (a) All mailing dates and receipt dates referred to in this subpart must be substantiated by the original receipts from the U.S. Postal Service. (b) If a lender or third-party servicer refuses to accept a notice mailed under this subpart, the Secretary considers the notice as being received on the date that the lender or servicer refuses to accept the notice. |
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