I 

118TH CONGRESS 

2D SESSION H. R. 10159 

To amend the Higher Education Act of 1965 to lower the interest rate 

on Federal student loans to 1 percent. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 18, 2024 

Mr. LAWLER introduced the following bill; which was referred to the 

Committee on Education and the Workforce 

A BILL 

To amend the Higher Education Act of 1965 to lower the 

interest rate on Federal student loans to 1 percent. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Affordable Loans for 

5 Students Act’’. 

6 SEC. 2. PROGRAM AUTHORITY. 

7 Section 451(a) of the Higher Education Act of 1965 

8 (20 U.S.C. 1087a(a)) is amended— 

9 (1) by striking ‘‘and (2)’’ and inserting ‘‘(2)’’; 

10 and 


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1 (2) by inserting ‘‘; and (3) to make loans under 

2 section 460A(b)’’ after ‘‘section 459A’’. 

3 SEC. 3. PROGRAM FOR THE LOAN MODIFICATION OF ELIGI4 BLE FEDERAL LOANS HELD BY THE SEC5 RETARY, AND REFINANCING OF OTHER FED6 ERAL STUDENT LOANS. 

7 (a) LOAN MODIFICATION AND REFINANCING.—Part 

8 D of title IV of the Higher Education Act of 1965 (20 

9 U.S.C. 1087a et seq.) is amended by adding at the end 

10 the following: 

11 ‘‘SEC. 460A. PROGRAM FOR THE LOAN MODIFICATION OF 

12 ELIGIBLE FEDERAL LOANS HELD BY THE 

13 SECRETARY, AND REFINANCING OF OTHER 

14 FEDERAL STUDENT LOANS. 

15 ‘‘(a) FEDERAL DIRECT LOAN MODIFICATION.—The 

16 Secretary shall establish and implement, with respect to 

17 each borrower of an eligible Federal loans held by the Sec18 retary, procedures to modify, without any action from the 

19 borrower, the terms of such loan so that beginning on the 

20 first July 1 after the date of enactment of the Affordable 

21 Loans for Students Act, the applicable rate of interest 

22 shall be 1.0 percent on the unpaid principal balance of 

23 the loan. 


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1 ‘‘(b) REFINANCING ELIGIBLE FEDERAL LOANS NOT

2 HELD BY THE SECRETARY AS FEDERAL DIRECT CON3 SOLIDATION LOANS.— 

4 ‘‘(1) IN GENERAL.—The Secretary shall estab5 lish and implement, with respect to each borrower of 

6 an eligible Federal loan not held by the Secretary, 

7 procedures to refinance such loan in accordance with 

8 the requirements of paragraph (2) and without any 

9 action from the borrower, except that such borrower 

10 may opt out of such procedures with respect to such 

11 loan. 

12 ‘‘(2) PROCEDURES.—In refinancing an eligible 

13 Federal loan not held by the Secretary with respect 

14 to a borrower of such loan, the Secretary shall carry 

15 out the following: 

16 ‘‘(A) The Secretary shall make a Federal 

17 Direct Consolidation Loan under this sub18 section, in an amount equal to the sum of the 

19 unpaid principal, accrued unpaid interest, and 

20 late charges of the eligible Federal loan not 

21 held by the Secretary. 

22 ‘‘(B) The Secretary shall pay the proceeds 

23 of such Federal Direct Consolidation Loan to 

24 the holder of the eligible Federal non-direct 

25 loan, in order to discharge the borrower from 


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1 any remaining obligation with respect to such 

2 eligible Federal loan not held by the Secretary. 

3 ‘‘(3) TERMS AND CONDITIONS OF REFINANCED

4 LOANS.— 

5 ‘‘(A) IN GENERAL.—A Federal Direct Con6 solidation Loan made under this subsection 

7 shall have the same terms and conditions as a 

8 Federal Direct Consolidation Loan that was not 

9 made under this subsection, except— 

10 ‘‘(i) that the Secretary may adjust 

11 such terms and conditions as necessary to 

12 enable the borrower to access loan forgive13 ness or other benefits available to the bor14 rower under the loan before refinancing 

15 under this subsection, in any case where 

16 such benefits are more generous than pro17 vided under a Federal Direct Consolidation 

18 Loan; and 

19 ‘‘(ii) as otherwise provided in this sub20 section. 

21 ‘‘(B) NO ORIGINATION FEES.—Notwith22 standing section 455(c), the Secretary may not 

23 charge a borrower of a loan made under this 

24 subsection an origination fee for such loan. 


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1 ‘‘(C) INTEREST RATE.—The applicable 

2 rate of interest for a loan made under this sub3 section shall be 1.0 percent on the unpaid prin4 cipal balance of the loan. 

5 ‘‘(D) NO AUTOMATIC EXTENSION OF RE6 PAYMENT PERIOD.—A loan made under this 

7 subsection shall not result in the extension of 

8 the duration of the repayment period of the 

9 original loan, and the borrower shall retain the 

10 same repayment term that was in effect on the 

11 original loan. Nothing in this paragraph shall 

12 be construed to prevent a borrower from elect13 ing a different repayment plan at any time in 

14 accordance with section 455(d)(3). 

15 ‘‘(E) RULE OF CONSTRUCTION.—Nothing 

16 in this section shall be construed to— 

17 ‘‘(i) prohibit a borrower of an eligible 

18 Federal loan not held by the Secretary 

19 from consolidating such a loan with any 

20 other loan eligible for consolidation under 

21 this section into a single consolidation loan 

22 under this section; or 

23 ‘‘(ii) require such a borrower to con24 solidate any such loan with any other loan 

25 eligible for consolidation under this section 


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1 into a single consolidation loan under this 

2 section. 

3 ‘‘(c) REPORT.—Not later than 180 days after the sec4 ond July 1 after the date of enactment of the Affordable 

5 Loans for Students Act, and on an annual basis there6 after, the Secretary shall submit a report to the author7 izing committees that includes— 

8 ‘‘(1) the total number of borrowers whose loans 

9 have been modified or refinanced under this section 

10 during the preceding year; and 

11 ‘‘(2) the number of such borrowers who are de12 linquent in making payments on such a loan. 

13 ‘‘(d) DEFINITIONS.—In this section: 

14 ‘‘(1) ELIGIBLE FEDERAL LOAN HELD BY THE

15 SECRETARY.—The term ‘eligible Federal loan held 

16 by the Secretary’ means— 

17 ‘‘(A) any loan made under this part, and 

18 first disbursed before the first July 1 after the 

19 date of enactment of the Affordable Loans for 

20 Students Act; 

21 ‘‘(B) any loan made, insured, or guaran22 teed under part B, and which is held by the 

23 Secretary; 

24 ‘‘(C) any loan made under part E, and 

25 which is held by the Secretary; and 


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1 ‘‘(D) any loan made under subpart I of 

2 part A of title VII of the Public Health Service 

3 Act (42 U.S.C. 292 et seq.), and which is held 

4 by the Secretary. 

5 ‘‘(2) ELIGIBLE FEDERAL LOAN NOT HELD BY

6 THE SECRETARY.—The term ‘eligible Federal loan 

7 not held by the Secretary’ means any loan— 

8 ‘‘(A) made, insured, or guaranteed under 

9 part B, and which is not held by the Secretary; 

10 ‘‘(B) made under part E, and which is not 

11 held by the Secretary; and 

12 ‘‘(C) made under— 

13 ‘‘(i) subpart I of part A of title VII of 

14 the Public Health Service Act (42 U.S.C. 

15 292 et seq.), and which is not held by the 

16 Secretary; 

17 ‘‘(ii) subpart II of part A of title VII 

18 of the Public Health Service Act (42 

19 U.S.C. 292q et seq.); or 

20 ‘‘(iii) part E of title VIII of the Public 

21 Health Service Act (42 U.S.C. 297a et 

22 seq.). 

23 ‘‘(3) ORIGINAL LOAN.—The term ‘original 

24 loan’, used with respect to a Federal Direct Consoli25 dation Loan made under subsection (b), means a 


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1 loan for which a borrower’s liability is discharged by 

2 such Federal Direct Consolidation Loan.’’. 

3 (d) CONFORMING AMENDMENTS.—The Higher Edu4 cation Act of 1965 (20 U.S.C. 1001 et seq.) is amended— 

5 (1) in section 428C(a)(3)(B)(i)(V) (20 U.S.C. 

6 1078–3(3)(B)(i)(V))— 

7 (A) by striking the period at the end of 

8 item (cc) and inserting a semicolon; 

9 (B) by striking the period at the end of 

10 item (dd) and inserting ‘‘; or’’; and 

11 (C) by adding at the end the following: 

12 ‘‘(ee) for the purpose of ob13 taining a Federal Direct Consoli14 dation Loan under section 

15 460A(b).’’. 

16 SEC. 4. APPLICABLE RATES OF INTEREST FOR LOANS 

17 MADE ON OR AFTER THE FIRST JULY 1 

18 AFTER THE DATE OF ENACTMENT OF THE AF19 FORDABLE LOANS FOR STUDENTS ACT. 

20 Section 455(b)(8) of the Higher Education Act of 

21 1965 (20 U.S.C. 1087e(b)(8)) is amended— 

22 (1) in the paragraph heading, by inserting 

23 ‘‘AND BEFORE THE FIRST JULY 1 AFTER THE DATE

24 OF ENACTMENT OF THE AFFORDABLE LOANS FOR

25 STUDENTS ACT ’’ after ‘‘JULY 1, 2013’’; 


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1 (2) in subparagraph (A), by inserting ‘‘and be2 fore the first July 1 after the date of enactment of 

3 the Affordable Loans for Students Act’’ after ‘‘July 

4 1, 2013’’; 

5 (3) in subparagraph (B), by inserting ‘‘and be6 fore the first July 1 after the date of enactment of 

7 the Affordable Loans for Students Act’’ after ‘‘July 

8 1, 2013’’; 

9 (4) in subparagraph (C), by inserting ‘‘and be10 fore the first July 1 after the date of enactment of 

11 the Affordable Loans for Students Act’’ after ‘‘July 

12 1, 2013’’; 

13 (5) in subparagraph (D), by inserting ‘‘and be14 fore the first July 1 after the date of enactment of 

15 the Affordable Loans for Students Act’’ after ‘‘July 

16 1, 2013’’; 

17 (6) by redesignating subparagraph (F) as sub18 paragraph (G); and 

19 (7) by inserting after subparagraph (E) the fol20 lowing: 

21 ‘‘(F) NEW LOANS ON OR AFTER THE FIRST

22 JULY 1 AFTER THE DATE OF ENACTMENT OF

23 THE AFFORDABLE LOANS FOR STUDENTS

24 ACT.—Notwithstanding the preceding subpara25 graphs of this paragraph, for Federal Direct 


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1 Stafford Loans, Federal Direct Unsubsidized 

2 Stafford Loans, Federal Direct PLUS Loans, 

3 and Federal Direct Consolidation Loans for 

4 which the first disbursement is made, or the ap5 plication is received, on or after the first July 

6 1 after the date of enactment of the Affordable 

7 Loans for Students Act, the applicable rate of 

8 interest shall be 1.0 percent on the unpaid prin9 cipal balance of the loan.’’. 

Æ 


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