II 

117TH CONGRESS 

2D SESSION S. 3953 

To amend the Higher Education Act of 1965 in order to increase usage 

of the Federal student loan income-based repayment plan and improve 

repayment options for borrowers, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 30, 2022 

Mr. MERKLEY (for himself, Ms. HASSAN, Ms. CORTEZ MASTO, Mr. SCHATZ, 

Mr. WYDEN, Mr. VAN HOLLEN, Ms. BALDWIN, Mr. BLUMENTHAL, Mr. 

CARDIN, and Mr. BOOKER) introduced the following bill; which was read 

twice and referred to the Committee on Health, Education, Labor, and 

Pensions 

A BILL 

To amend the Higher Education Act of 1965 in order to 

increase usage of the Federal student loan income-based 

repayment plan and improve repayment options for borrowers, and for other purposes. 

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Affordable Loans for Any Student Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 


pamtmann on DSKBC07HB2PROD with BILLS
2 

•S 3953 IS

Sec. 1. Short title; table of contents. 

Sec. 2. References in Act. 

TITLE I—SIMPLIFYING REPAYMENT PLANS 

Sec. 101. Income-based repayment plan. 

Sec. 102. Fixed repayment plan. 

Sec. 103. Termination of certain repayment plan options. 

Sec. 104. Providing incentives to switch into simplified repayment plans. 

Sec. 105. Study and procedures on determining family size. 

TITLE II—ENDING INTEREST CAPITALIZATION AND ORIGINATION 

FEES 

Sec. 201. Ending interest capitalization for Federal Direct Loans. 

Sec. 202. Elimination of origination fees for Federal Direct Loans. 

TITLE III—PROVIDING ASSISTANCE IN SITUATIONS OF 

BORROWER DISTRESS 

Sec. 301. Limits on seizing income for debt. 

Sec. 302. Allowing for multiple loan rehabilitations. 

Sec. 303. Pause payment process. 

Sec. 304. Automatic enrollment into income-based repayment for borrowers 

who are delinquent on loans and for borrowers who rehabilitate 

defaulted loans. 

Sec. 305. Separating joint consolidation loans. 

Sec. 306. Removing the collection cost requirement. 

TITLE IV—IMPROVING LOAN INFORMATION AND COUNSELING 

Sec. 401. Student loan contract; simplifying loan disclosures. 

Sec. 402. Pre-loan information and counseling requirements. 

Sec. 403. Exit counseling. 

Sec. 404. Online counseling tools. 

Sec. 405. Private education loan certification and information. 

TITLE V—EFFECTIVE DATE; TRANSITION; IMPLEMENTATION 

Sec. 501. Effective date; rulemaking regarding termination of certain repayment termination of certain repayment plans; implementation. 

1 SEC. 2. REFERENCES IN ACT. 

2 Except as otherwise expressly provided in this Act, 

3 wherever an amendment or repeal is expressed in terms 

4 of an amendment to or repeal of a section or other provi5 sion, the reference shall be considered to be made to that 

6 section or other provision of the Higher Education Act of 

7 1965 (20 U.S.C. 1001 et seq.). 


pamtmann on DSKBC07HB2PROD with BILLS
3 

•S 3953 IS

1 TITLE I—SIMPLIFYING 

2 REPAYMENT PLANS 

3 SEC. 101. INCOME-BASED REPAYMENT PLAN. 

4 Section 493C (20 U.S.C. 1098e) is amended to read 

5 as follows: 

6 ‘‘SEC. 493C. INCOME-BASED REPAYMENT. 

7 ‘‘(a) DEFINITIONS.—In this section: 

8 ‘‘(1) EXCEPTED PLUS LOAN.—The term ‘ex9 cepted PLUS loan’ means a loan under section 

10 428B, or a Federal Direct PLUS Loan, that is 

11 made, insured, or guaranteed on behalf of a depend12 ent student. 

13 ‘‘(2) EXCEPTED CONSOLIDATION LOAN.—The 

14 term ‘excepted consolidation loan’ means a consoli15 dation loan under section 428C, or a Federal Direct 

16 Consolidation Loan, if the proceeds of such loan 

17 were used to the discharge the liability on an ex18 cepted PLUS loan. 

19 ‘‘(3) PARTIAL FINANCIAL HARDSHIP.—The 

20 term ‘partial financial hardship’, when used with re21 spect to a borrower, means that for such borrower— 

22 ‘‘(A) the annual amount due on the total 

23 amount of loans made, insured, or guaranteed 

24 under part B or D (other than an excepted 

25 PLUS loan or excepted consolidation loan) to a 


pamtmann on DSKBC07HB2PROD with BILLS
4 

•S 3953 IS

1 borrower as calculated under the standard re2 payment plan under section 428(b)(9)(A)(i) or 

3 455(d)(1)(A), based on a 10-year repayment 

4 period; exceeds 

5 ‘‘(B) 15 percent of the result obtained by 

6 calculating, on at least an annual basis, the 

7 amount by which— 

8 ‘‘(i) the borrower’s, and the bor9 rower’s spouse’s (if applicable), adjusted 

10 gross income; exceeds 

11 ‘‘(ii) 150 percent of the poverty line 

12 applicable to the borrower’s family size as 

13 determined under section 673(2) of the 

14 Community Services Block Grant Act (42 

15 U.S.C. 9902(2)). 

16 ‘‘(b) INCOME-BASED REPAYMENT PROGRAM FOR

17 BORROWERS WHO ENTER INCOME-BASED REPAYMENT

18 BEFORE JULY 1, 2022.—Notwithstanding any other pro19 vision of this Act, the Secretary shall carry out a program 

20 under which— 

21 ‘‘(1) a borrower of any loan made, insured, or 

22 guaranteed under part B or D (other than an ex23 cepted PLUS loan or excepted consolidation loan) 

24 who has a partial financial hardship (whether or not 

25 the borrower’s loan has been submitted to a guarVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
5 

•S 3953 IS

1 anty agency for default aversion or had been in de2 fault) may elect, during any period the borrower has 

3 the partial financial hardship, to have the borrower’s 

4 aggregate monthly payment for all such loans not 

5 exceed the result described in subsection (a)(3)(B) 

6 divided by 12; 

7 ‘‘(2) the holder of such a loan shall apply the 

8 borrower’s monthly payment under this subsection 

9 first toward interest due on the loan, next toward 

10 any fees due on the loan, and then toward the prin11 cipal of the loan; 

12 ‘‘(3) any interest due and not paid under para13 graph (2)— 

14 ‘‘(A) shall, on subsidized loans, be paid by 

15 the Secretary for a period of not more than 3 

16 years after the date of the borrower’s election 

17 under paragraph (1); and 

18 ‘‘(B) beginning on the effective date of the 

19 Affordable Loans for Any Student Act, for an 

20 eligible loan made, insured, or guaranteed 

21 under this title, shall not be capitalized and 

22 shall be added to the balance of interest due for 

23 the loan; 

24 ‘‘(4) any principal due and not paid under 

25 paragraph (2) shall be deferred; 


pamtmann on DSKBC07HB2PROD with BILLS
6 

•S 3953 IS

1 ‘‘(5) the amount of time the borrower makes 

2 monthly payments under paragraph (1) may exceed 

3 10 years; 

4 ‘‘(6) if the borrower no longer has a partial fi5 nancial hardship or no longer wishes to continue the 

6 election under this subsection, then— 

7 ‘‘(A) the maximum monthly payment re8 quired to be paid for all loans made to the bor9 rower under part B or D (other than an ex10 cepted PLUS loan or excepted consolidation 

11 loan) shall not exceed the monthly amount cal12 culated under section 428(b)(9)(A)(i) or 

13 455(d)(1)(A), based on a 10-year repayment 

14 period, when the borrower first made the elec15 tion described in this subsection; and 

16 ‘‘(B) the amount of time the borrower is 

17 permitted to repay such loans may exceed 10 

18 years; 

19 ‘‘(7) the Secretary shall repay or cancel any 

20 outstanding balance of principal and interest due on 

21 all loans made under part B or D (other than a loan 

22 under section 428B or a Federal Direct PLUS 

23 Loan) to a borrower who— 


pamtmann on DSKBC07HB2PROD with BILLS
7 

•S 3953 IS

1 ‘‘(A) at any time, elected to participate in 

2 income-based repayment under paragraph (1); 

3 and 

4 ‘‘(B) for a period of time prescribed by the 

5 Secretary, not to exceed 25 years, meets 1 or 

6 more of the following requirements— 

7 ‘‘(i) has made reduced monthly pay8 ments under paragraph (1) or paragraph 

9 (6); 

10 ‘‘(ii) has made monthly payments of 

11 not less than the monthly amount cal12 culated under section 428(b)(9)(A)(i) or 

13 455(d)(1)(A), based on a 10-year repay14 ment period, when the borrower first made 

15 the election described in this subsection; 

16 ‘‘(iii) has made payments of not less 

17 than the payments required under a stand18 ard repayment plan under section 

19 428(b)(9)(A)(i) or 455(d)(1)(A) with a re20 payment period of 10 years; 

21 ‘‘(iv) has made payments under an in22 come-contingent repayment plan under sec23 tion 455(d)(1)(D); or 


pamtmann on DSKBC07HB2PROD with BILLS
8 

•S 3953 IS

1 ‘‘(v) has been in deferment due to an 

2 economic hardship described in section 

3 435(o); 

4 ‘‘(8) a borrower who is repaying a loan made 

5 under part B or D pursuant to income-based repay6 ment may elect, at any time, to terminate repayment 

7 pursuant to income-based repayment and repay such 

8 loan under the fixed repayment plan under section 

9 493E; and 

10 ‘‘(9) the special allowance payment to a lender 

11 calculated under section 438(b)(2)(I), when cal12 culated for a loan in repayment under this section, 

13 shall be calculated on the principal balance of the 

14 loan and on any accrued interest unpaid by the bor15 rower in accordance with this section. 

16 ‘‘(c) INCOME-BASED REPAYMENT PROGRAM FOR

17 BORROWERS WHO ENTER INCOME-BASED REPAYMENT

18 ON OR AFTER JULY 1, 2022.— 

19 ‘‘(1) IN GENERAL.—Notwithstanding any other 

20 provision of this section, the provisions of this sub21 section shall apply— 

22 ‘‘(A) with respect to any loan made, in23 sured, or guaranteed under this title for which 

24 the borrower enters repayment on or after July 

25 1, 2022, and for which the borrower elects the 


pamtmann on DSKBC07HB2PROD with BILLS
9 

•S 3953 IS

1 income-based repayment plan under this sec2 tion; and 

3 ‘‘(B) with respect to any loan made, in4 sured, or guaranteed under this title for which 

5 the borrower enrolled in an income-based repay6 ment plan before July 1, 2022, if such borrower 

7 elects to enter the income-based repayment plan 

8 under this subsection, in accordance with para9 graph (3). 

10 ‘‘(2) SPECIAL TERMS.—With respect to a loan 

11 described in paragraph (1), the following terms shall 

12 apply to the income-based repayment plan carried 

13 out under this section: 

14 ‘‘(A)(i) Notwithstanding subsection 

15 (a)(3)(B), (b), or (e)— 

16 ‘‘(I) the annual repayment amount 

17 under this subsection— 

18 ‘‘(aa) with respect to a borrower 

19 whose (and whose spouse’s, if applica20 ble) adjusted gross income equals or 

21 exceeds 1,300 percent of the poverty 

22 line that is applicable to the bor23 rower’s family size as determined 

24 under section 673(2) of the Commu25 nity Services Block Grant Act (42 


pamtmann on DSKBC07HB2PROD with BILLS
10 

•S 3953 IS

1 U.S.C. 9902(2)) shall be an amount 

2 equal to 10 percent of such adjusted 

3 gross income; 

4 ‘‘(bb) with respect to a borrower 

5 whose (and whose spouse’s, if applica6 ble) adjusted gross income equals or 

7 exceeds 800 percent of the poverty 

8 line but is less than 1,300 percent of 

9 the poverty line that is applicable to 

10 the borrower’s family size as deter11 mined under section 673(2) of the 

12 Community Services Block Grant Act 

13 (42 U.S.C. 9902(2)) shall be equal to 

14 the amount determined under clause 

15 (ii)(I); 

16 ‘‘(cc) with respect to a borrower 

17 whose (and whose spouse’s, if applica18 ble) adjusted gross income exceeds 

19 250 percent of the poverty line but is 

20 less than 800 percent of the poverty 

21 line that is applicable to the bor22 rower’s family size as determined 

23 under section 673(2) of the Commu24 nity Services Block Grant Act (42 

25 U.S.C. 9902(2)) shall be equal to the 


pamtmann on DSKBC07HB2PROD with BILLS
11 

•S 3953 IS

1 amount determined under clause 

2 (ii)(II); and 

3 ‘‘(dd) with respect to a borrower 

4 whose (and whose spouse’s, if applica5 ble) adjusted gross income equals or 

6 is less than 250 percent of the poverty 

7 line that is applicable to the bor8 rower’s family size as determined 

9 under section 673(2) of the Commu10 nity Services Block Grant Act (42 

11 U.S.C. 9902(2)) shall be an amount 

12 equal to 0 percent of such adjusted 

13 gross income; and 

14 ‘‘(II) a borrower’s monthly payment 

15 shall be determined in accordance with 

16 subclause (I) divided by 12, which amount 

17 may exceed the monthly repayment 

18 amount under a standard 10-year repay19 ment plan or a fixed repayment plan de20 scribed in section 493E. 

21 ‘‘(ii)(I)(aa) For purposes of clause 

22 (i)(I)(bb), the annual repayment amount for 

23 borrowers described in such clause shall be an 

24 amount equal to 10 percent of the result obVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
12 

•S 3953 IS

1 tained by calculating, on at least an annual 

2 basis, the amount by which— 

3 ‘‘(AA) the borrower’s, and the bor4 rower’s spouse’s (if applicable), adjusted 

5 gross income; exceeds 

6 ‘‘(BB) the percent determined under 

7 item (bb) of the poverty line that is appli8 cable to the borrower’s family size as de9 termined under section 673(2) of the Com10 munity Services Block Grant Act (42 

11 U.S.C. 9902(2)). 

12 ‘‘(bb) The percent shall be determined 

13 under this item as follows: 

14 ‘‘(AA) If the borrower’s, and the bor15 rower’s spouse’s (if applicable), adjusted 

16 gross income equals 800 percent of the 

17 poverty line that is applicable to the bor18 rower’s family size as determined under 

19 section 673(2) of the Community Services 

20 Block Grant Act (42 U.S.C. 9902(2)), the 

21 percent shall be equal to 250 percent. 

22 ‘‘(BB) If the borrower’s, and the bor23 rower’s spouse’s (if applicable), adjusted 

24 gross income exceeds 800 percent of the 

25 poverty line but is less than 1,300 percent 


pamtmann on DSKBC07HB2PROD with BILLS
13 

•S 3953 IS

1 of the poverty line that is applicable to the 

2 borrower’s family size as determined under 

3 section 673(2) of the Community Services 

4 Block Grant Act (42 U.S.C. 9902(2)), the 

5 percent shall be equal to 250 percent re6 duced by 0.5 percentage points for every 1 

7 percentage point increase in the bor8 rower’s, and the borrower’s spouse’s (if ap9 plicable), adjusted gross income that is 

10 more than 800 percent. 

11 ‘‘(II) For purposes of clause (i)(I)(cc), the an12 nual repayment amount for borrowers described in 

13 such clause shall be an amount equal to 10 percent 

14 of the result obtained by calculating, on at least an 

15 annual basis, the amount by which— 

16 ‘‘(aa) the borrower’s, and the borrower’s 

17 spouse’s (if applicable), adjusted gross income; 

18 exceeds 

19 ‘‘(bb) 250 percent of the poverty line that 

20 is applicable to the borrower’s family size as de21 termined under section 673(2) of the Commu22 nity Services Block Grant Act (42 U.S.C. 

23 9902(2)). 


pamtmann on DSKBC07HB2PROD with BILLS
14 

•S 3953 IS

1 ‘‘(B) Notwithstanding subsection (e)(2), sub2 section (b)(7)(B) shall be applied by substituting ‘20 

3 years’ for ‘25 years’. 

4 ‘‘(C) Notwithstanding subparagraph (A) of sub5 section (b)(6), a borrower of such a loan shall not 

6 be required to have a partial financial hardship and 

7 may elect, and remain enrolled in, the income-based 

8 repayment plan under this section regardless of in9 come level, with the repayment amount calculated 

10 under subparagraph (A). 

11 ‘‘(D) Notwithstanding subsection (b), a bor12 rower of an excepted PLUS loan or excepted consoli13 dation loan may elect the income-based repayment 

14 plan under this subsection for the excepted PLUS 

15 loan or excepted consolidation loan, and the Sec16 retary shall treat such loan, only for the purposes of 

17 the repayment terms, as a Federal Direct PLUS 

18 Loan issued to a student borrower. The Secretary 

19 may issue rules and regulations, as the Secretary de20 termines necessary, regarding the treatment of ex21 cepted PLUS loans or excepted consolidation loans 

22 that are to be repaid under an income-based repay23 ment plan under this subsection. 

24 ‘‘(3) RULE FOR BORROWERS IN INCOME-BASED

25 REPAYMENT BEFORE JULY 1, 2022.—A borrower of 


pamtmann on DSKBC07HB2PROD with BILLS
15 

•S 3953 IS

1 a loan made, insured, or guaranteed under this title 

2 who enrolled in an income-based repayment plan be3 fore July 1, 2022, may choose to retain such repay4 ment plan or elect to enter an income-based repay5 ment plan under this subsection or a fixed repay6 ment plan described in section 493E, as provided in 

7 section 428(b)(1)(D)(ii) or section 455(d)(7) (as ap8 plicable). 

9 ‘‘(4) INTEREST ACCRUAL.—Notwithstanding 

10 any other provision of this Act, if a borrower’s 

11 monthly payment for a loan under an income-based 

12 repayment plan under this subsection is insufficient 

13 to pay the accrued interest on the borrower’s loan 

14 for such month, any interest due and not paid on 

15 the loan for that month shall be paid or forgiven by 

16 the Secretary. 

17 ‘‘(5) WRITTEN, ELECTRONIC, OR VERBAL EN18 ROLLMENT IN INCOME-BASED REPAYMENT.— 

19 ‘‘(A) IN GENERAL.—A borrower of a loan 

20 made under this part may elect to repay such 

21 loan under the income-based repayment plan 

22 under this subsection by providing written, elec23 tronic, or verbal notice to the Secretary of the 

24 borrower’s desire to make such election, subject 

25 to subparagraph (C). 


pamtmann on DSKBC07HB2PROD with BILLS
16 

•S 3953 IS

1 ‘‘(B) USE OF INFORMATION.— 

2 ‘‘(i) IN GENERAL.—The estimated 

3 monthly payment amount under this sec4 tion for a loan for a borrower who makes 

5 an election described in subparagraph (A) 

6 shall be immediately calculated using the 

7 income and family size information pro8 vided through the borrower’s written, elec9 tronic, or verbal statement. 

10 ‘‘(ii) VERIFICATION.—The informa11 tion described in clause (i) shall be verified 

12 by the Secretary not later than 90 days 

13 after the date the borrower states such in14 come and family size information. If the 

15 Secretary is unable to verify the informa16 tion by the end of the 90-day period, the 

17 borrower’s payment after such 90-day pe18 riod will be the amount applicable under 

19 the fixed repayment plan under section 

20 493E. 

21 ‘‘(iii) ADJUSTMENT IF NECESSARY.— 

22 Upon verification by the Secretary under 

23 clause (ii), the Secretary shall adjust the 

24 estimated monthly payment described in 

25 clause (i) based on the verified income and 


pamtmann on DSKBC07HB2PROD with BILLS
17 

•S 3953 IS

1 family size information of the borrower, if 

2 necessary. Any adjusted monthly payment 

3 shall take effect beginning with the pay4 ment due not less than 60 days after the 

5 Secretary notifies the borrower of the ad6 justed amount. The Secretary shall con7 sider any payments made prior to the ad8 justed monthly payment as having satisfied 

9 the amount due to qualify toward loan can10 cellation or forgiveness options under this 

11 title. 

12 ‘‘(C) LIMITATION.—The Secretary shall 

13 permit a borrower to make an election of in14 come-based repayment in the written, elec15 tronic, or verbal manner described in subpara16 graph (A) only in connection with the first in17 stance of each of the following: 

18 ‘‘(i) The borrower’s selection of a re19 payment plan during the grace period for 

20 such loan. 

21 ‘‘(ii) The borrower changing from the 

22 fixed repayment plan under section 493E 

23 to income-based repayment. 


pamtmann on DSKBC07HB2PROD with BILLS
18 

•S 3953 IS

1 ‘‘(iii) The borrower’s failure to com2 plete the verification process described in 

3 subparagraph (B)(ii). 

4 ‘‘(iv) The borrower’s failure to recer5 tify enrollment in income-based repayment 

6 under this subsection. 

7 ‘‘(d) CALCULATION OF ADJUSTED GROSS INCOME

8 FOR MARRIED BORROWERS.—The Secretary shall cal9 culate the adjusted gross income of a married borrower 

10 under this section— 

11 ‘‘(1) in the case of a married borrower and 

12 spouse who jointly file a Federal income tax return, 

13 based on the adjusted gross income of the borrower 

14 and spouse as reported on the Federal income tax 

15 return; and 

16 ‘‘(2) in the case of a married borrower who files 

17 a Federal income tax return separately from the 

18 borrower’s spouse, based on the sum of the adjusted 

19 gross income of the borrower and the spouse, as re20 ported on the applicable Federal income tax returns, 

21 unless the borrower certifies, on a form approved by 

22 the Secretary, that the borrower is— 

23 ‘‘(A) separated from the borrower’s spouse; 

24 or 


pamtmann on DSKBC07HB2PROD with BILLS
19 

•S 3953 IS

1 ‘‘(B) unable to reasonably access the in2 come information of the borrower’s spouse. 

3 ‘‘(e) SPECIAL TERMS FOR NEW BORROWERS ON AND

4 AFTER JULY 1, 2014.—With respect to any loan made 

5 to a new borrower on or after July 1, 2014— 

6 ‘‘(1) subsection (a)(3)(B) shall be applied by 

7 substituting ‘10 percent’ for ‘15 percent’; and 

8 ‘‘(2) subsection (b)(7)(B) shall be applied by 

9 substituting ‘20 years’ for ‘25 years’. 

10 ‘‘(f) ELIGIBILITY DETERMINATIONS AND AUTOMATIC

11 RECERTIFICATION.— 

12 ‘‘(1) IN GENERAL.—Beginning as soon as the 

13 Secretary determines practicable after the Secretary 

14 finalizes the procedures under section 105 of the Af15 fordable Loans for Any Student Act, the Secretary 

16 shall establish and implement, with respect to any 

17 borrower described in paragraph (2), procedures 

18 to— 

19 ‘‘(A) obtain (for each year of repayment 

20 and without further action by the borrower) 

21 such information as is reasonably necessary re22 garding the income of such borrower (and the 

23 borrower’s spouse, if applicable), for the pur24 pose of determining the repayment obligation of 

25 the borrower for such year, including informaVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
20 

•S 3953 IS

1 tion with respect to the borrower’s family size 

2 in accordance with the procedures under such 

3 section 105, subject to subparagraph (B); 

4 ‘‘(B) allow the borrower, at any time, to 

5 opt out of subparagraph (A) and prevent the 

6 Secretary from obtaining information under 

7 such subparagraph without further action by 

8 the borrower; 

9 ‘‘(C) provide the borrower with an oppor10 tunity to update the information obtained under 

11 subparagraph (A) before the determination of 

12 the annual repayment obligation of the bor13 rower; and 

14 ‘‘(D) in the case of a borrower for whom 

15 adjusted gross income can be obtained under 

16 this subsection and meets the qualifications of 

17 a payment amount of $0, ensure that the bor18 rower will not be required to provide the Sec19 retary with other documentation of income and 

20 provide the borrower with a calculated monthly 

21 payment of $0. 

22 ‘‘(2) APPLICABILITY.— 

23 ‘‘(A) IN GENERAL.—Paragraph (1) shall 

24 apply to each borrower of a loan made under 

25 this part who, on or after the date on which the 


pamtmann on DSKBC07HB2PROD with BILLS
21 

•S 3953 IS

1 Secretary establishes procedures under such 

2 paragraph— 

3 ‘‘(i) selects, or for whom the Secretary 

4 selected under subparagraph (C) or (D) of 

5 paragraph (8), or paragraph (9), of sub6 section (d), or section 428(m)(1), an in7 come-based repayment plan; or 

8 ‘‘(ii) recertifies income and family size 

9 under such plan. 

10 ‘‘(B) ELIGIBILITY EXCEPTION.—A bor11 rower for whom adjusted gross income is un12 available because the borrower has been granted 

13 an extension on filing the borrower’s income 

14 taxes or is undergoing an audit or examination 

15 by the Internal Revenue Service shall not auto16 matically be eligible for the calculated monthly 

17 payment of $0 in accordance with paragraph 

18 (1)(D) during such period. When the extension, 

19 audit, or examination is completed, the Sec20 retary shall resume consideration of the bor21 rower for automatic recertification under the 

22 procedures described in paragraph (1), includ23 ing subparagraph (D) of such paragraph (if ap24 plicable). 


pamtmann on DSKBC07HB2PROD with BILLS
22 

•S 3953 IS

1 ‘‘(3) AVAILABILITY OF RETURNS AND RETURN

2 INFORMATION.—Returns and return information (as 

3 defined in section 6103 of the Internal Revenue 

4 Code of 1986) may be obtained under paragraph 

5 (1)(A) only to the extent authorized by section 

6 6103(l)(13) of such Code.’’. 

7 SEC. 102. FIXED REPAYMENT PLAN. 

8 Part G of title IV (20 U.S.C. 1088 et seq.) is amend9 ed by adding at the end the following: 

10 ‘‘SEC. 493E. FIXED REPAYMENT PLAN. 

11 ‘‘(a) IN GENERAL.—A borrower of a loan made under 

12 part D on or after July 1, 2022, and a borrower who is 

13 in repayment on a loan made, insured, or guaranteed 

14 under part B or D before July 1, 2022, may elect to repay 

15 such loan under the fixed repayment plan described in this 

16 section. 

17 ‘‘(b) FIXED REPAYMENT PLAN.—Under the fixed re18 payment plan, a borrower shall repay each loan described 

19 in subsection (a) with a fixed monthly repayment amount 

20 paid over a period of 10 years, subject to subsection (c). 

21 ‘‘(c) SPECIAL RULES.— 

22 ‘‘(1) MINIMUM.—If a borrower’s monthly pay23 ment under this section (except for the final pay24 ment on the loan) is less than $25, the Secretary 


pamtmann on DSKBC07HB2PROD with BILLS
23 

•S 3953 IS

1 shall establish the borrower’s monthly payment as 

2 $25. 

3 ‘‘(2) ALTERNATIVE MINIMUM PAYMENTS.—Not4 withstanding paragraph (1), the Secretary may ac5 cept an alternative minimum payment amount, 

6 which may include an amount of less than $25, to 

7 account for a borrower’s exceptional cir8 cumstances.’’. 

9 SEC. 103. TERMINATION OF CERTAIN REPAYMENT PLAN 

10 OPTIONS. 

11 (a) FFEL PROGRAM REPAYMENT PLAN OPTIONS.— 

12 Section 428(b) (20 U.S.C. 1078(b)) is amended— 

13 (1) in paragraph (1)— 

14 (A) in subparagraph (D)— 

15 (i) in clause (ii), by striking ‘‘may an16 nually change the selection of a repayment 

17 plan under this part,’’ and inserting ‘‘may 

18 at any time on or after July 1, 2022, 

19 change the selection of a repayment plan 

20 under this part or part G to one of the 2 

21 repayment plans described in paragraph 

22 (9)(C),’’; and 

23 (ii) in clause (iii), by inserting ‘‘or, in 

24 the case of a default that occurs on or 

25 after July 1, 2022, be subject to incomeVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
24 

•S 3953 IS

1 based repayment in accordance with sec2 tion 493C(c)’’ before the semicolon at the 

3 end; 

4 (B) in subparagraph (E)(i), by striking 

5 ‘‘the option of repaying the loan in accordance 

6 with a standard, graduated, income-sensitive, or 

7 extended repayment schedule (as described in 

8 paragraph (9)) established by the lender in ac9 cordance with regulations of the Secretary; 

10 and’’ and inserting ‘‘the option of repaying the 

11 loan in accordance with an applicable repay12 ment plan described in paragraph (9)(C)’’; and 

13 (C) by striking subparagraph (L); and 

14 (2) in paragraph (9)— 

15 (A) in subparagraph (A)— 

16 (i) in the subparagraph heading, by 

17 inserting ‘‘BEFORE JULY 1, 2022’’ after 

18 ‘‘SELECTION’’; and 

19 (ii) in the matter preceding clause 

20 (i)— 

21 (I) by inserting ‘‘or subparagraph 

22 (C), as applicable,’’ after ‘‘this sub23 paragraph’’; and 


pamtmann on DSKBC07HB2PROD with BILLS
25 

•S 3953 IS

1 (II) by striking ‘‘The borrower’’ 

2 and inserting ‘‘Before July 1, 2022, 

3 the borrower’’; 

4 (B) in subparagraph (B), by inserting be5 fore the period at the end ‘‘or, for a borrower 

6 entering repayment on or after July 1, 2022, 

7 the lender shall provide the borrower with the 

8 fixed repayment plan described in section 

9 493E’’; and 

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

11 ‘‘(C) SELECTION OF REPAYMENT PLANS

12 ON AND AFTER JULY 1, 2022.—Notwithstanding 

13 any other provision of law, and in accordance 

14 with regulations promulgated, beginning on 

15 July 1, 2022, a lender shall offer a borrower of 

16 a loan made, insured, or guaranteed under this 

17 part the opportunity to change repayment plans 

18 at any time on or after July 1, 2022, and then 

19 not more than once per calendar year there20 after. The borrower may choose between the 

21 following repayment plans: 

22 ‘‘(i) A fixed repayment plan described 

23 in section 493E. 

24 ‘‘(ii) The income-based repayment 

25 plan under section 493C(c).’’. 


pamtmann on DSKBC07HB2PROD with BILLS
26 

•S 3953 IS

1 (b) FEDERAL DIRECT LOAN PROGRAM REPAYMENT

2 PLAN OPTIONS.—Section 455(d) (20 U.S.C. 1087e(d)) is 

3 amended— 

4 (1) by redesignating paragraphs (2) through 

5 (5) as paragraphs (3) through (6), respectively; 

6 (2) in paragraph (1)— 

7 (A) in the paragraph heading, by inserting 

8 ‘‘BEFORE JULY 1, 2022’’ after ‘‘SELECTION’’; 

9 and 

10 (B) in the matter preceding subparagraph 

11 (A), by inserting ‘‘that enters repayment before 

12 July 1, 2022,’’ before ‘‘a variety’’; 

13 (3) by inserting after paragraph (1) the fol14 lowing: 

15 ‘‘(2) DESIGN AND SELECTION BEGINNING JULY

16 1, 2022.— 

17 ‘‘(A) IN GENERAL.—Notwithstanding para18 graph (1), for any borrower of a loan made 

19 under this part that enters repayment on or 

20 after July 1, 2022, and for any borrower sub21 ject to paragraph (7), the Secretary shall offer 

22 the borrower a choice between the following 2 

23 plans for repayment of such loan, including 

24 principal and interest on the loan. The borrower 

25 may choose— 


pamtmann on DSKBC07HB2PROD with BILLS
27 

•S 3953 IS

1 ‘‘(i) a fixed repayment plan described 

2 in section 493E; or 

3 ‘‘(ii) an income-based repayment plan 

4 under section 493C(c). 

5 ‘‘(B) ACCELERATION.—A borrower in re6 payment shall be entitled to accelerate, without 

7 penalty, repayment on the borrower’s loans 

8 under this part. 

9 ‘‘(C) SELECTION BY THE SECRETARY.—If 

10 a borrower of a loan made under this part that 

11 enters repayment on or after July 1, 2022, does 

12 not select a repayment plan described in sub13 paragraph (A) before the first payment on such 

14 loan is due, the Secretary shall provide the bor15 rower with a fixed repayment plan described in 

16 section 493E. 

17 ‘‘(D) CHANGES IN SELECTIONS.—A bor18 rower of a loan made under this part that en19 ters repayment or on after July 1, 2022, may 

20 change the borrower’s selection of a repayment 

21 plan in accordance with subparagraphs (B) and 

22 (C) of paragraph (7). 

23 ‘‘(E) BORROWER IN DEFAULT.—Beginning 

24 on July 1, 2022, in lieu of the requirements of 

25 paragraph (6), the Secretary may require any 


pamtmann on DSKBC07HB2PROD with BILLS
28 

•S 3953 IS

1 borrower who has defaulted on a loan made 

2 under this part on or after July 1, 2022, to 

3 repay the loan pursuant to an income-based re4 payment plan under section 493C(c).’’; and 

5 (4) by adding at the end the following: 

6 ‘‘(7) BORROWERS OF LOANS MADE BEFORE

7 JULY 1, 2022.—A borrower who is in repayment on 

8 a loan made under this part before July 1, 2022— 

9 ‘‘(A) may choose to retain the repayment 

10 plan that the borrower was enrolled in on the 

11 day before such date; 

12 ‘‘(B) may elect to— 

13 ‘‘(i) enter an income-based repayment 

14 plan under section 493C(c); 

15 ‘‘(ii) enter a fixed repayment plan de16 scribed in section 493E; or 

17 ‘‘(iii) switch between the repayment 

18 plans described in clauses (i) and (ii); 

19 ‘‘(C) after switching to a repayment plan 

20 described in clause (i) or (ii) of subparagraph 

21 (B), shall not be permitted to select a repay22 ment plan not described in subparagraph (B) 

23 for the loan; and 

24 ‘‘(D) shall retain, for purposes of repay25 ment or cancellation of any outstanding balance 


pamtmann on DSKBC07HB2PROD with BILLS
29 

•S 3953 IS

1 of principal and interest due on a loan (as de2 scribed in section 493C(b)(7)), any payments 

3 on such loan under another income-based or in4 come contingent repayment plan under this title 

5 that would otherwise be qualifying.’’. 

6 (c) CONFORMING AMENDMENT.—Section 

7 433(b)(7)(B) (20 U.S.C. 1083(b)(7)(B)) is amended by 

8 striking ‘‘on a standard repayment plan’’ and inserting ‘‘, 

9 in the case of a borrower who has not selected a repayment 

10 plan, on the repayment plan designated under subpara11 graph (B) of section 428(b)(9)’’. 

12 SEC. 104. PROVIDING INCENTIVES TO SWITCH INTO SIM13 PLIFIED REPAYMENT PLANS. 

14 (a) ENABLING CONSOLIDATION IN ORDER TO SIM15 PLIFY REPAYMENT.—Section 455(g) (20 U.S.C. 

16 1087e(g)) is amended— 

17 (1) by striking ‘‘A borrower of’’ and inserting 

18 the following: 

19 ‘‘(1) IN GENERAL.—A borrower of’’; 

20 (2) by striking the second sentence; and 

21 (3) by adding at the end the following: 

22 ‘‘(2) ELIGIBILITY.—To be eligible for a Federal 

23 Direct Consolidation Loan under this part, a bor24 rower shall meet the eligibility criteria set forth in 

25 section 428C(a)(3), except that, notwithstanding 


pamtmann on DSKBC07HB2PROD with BILLS
30 

•S 3953 IS

1 section 428C(a)(3)(B), a borrower may obtain a 

2 Federal Direct Consolidation Loan if the borrower— 

3 ‘‘(A) obtains the Federal Direct Consolida4 tion Loan for the purpose of— 

5 ‘‘(i) selecting the income-based repay6 ment plan under section 493C(c) or fixed7 income repayment plan under section 

8 495E; or 

9 ‘‘(ii) participating in the pause pay10 ment process under section 460B; and 

11 ‘‘(B) meets the requirements of section 

12 428C(a)(3)(A).’’. 

13 (b) INCENTIVES FOR SIMPLIFIED REPAYMENT

14 PLANS.—Part G of title IV (20 U.S.C. 1088 et seq.), as 

15 amended by section 102, is further amended by adding 

16 at the end the following: 

17 ‘‘SEC. 493F. INCENTIVES FOR SIMPLIFIED REPAYMENT 

18 PLANS. 

19 ‘‘(a) IN GENERAL.—To facilitate the transition of 

20 borrowers to simplified repayment plan options, the Sec21 retary shall reduce the interest rate applicable under sec22 tion 455(b) or 427A to a loan under part B or D held 

23 by a borrower as of July 1, 2022, by 100 basis points 

24 (or the equivalent), if the borrower of the loan, after the 


pamtmann on DSKBC07HB2PROD with BILLS
31 

•S 3953 IS

1 effective date of the Affordable Loans for Any Student 

2 Act— 

3 ‘‘(1) changes from a repayment plan described 

4 in subparagraphs (A) through (E) of section 

5 455(d)(1) for such loan to an income-based repay6 ment plan under section 493C(c) or a fixed repay7 ment plan under section 493E; or 

8 ‘‘(2) consolidates 1 or more loans under this 

9 title, or described in section 428C(a)(4), that were 

10 under a repayment plan described in subparagraphs 

11 (A) through (E) of section 455(d)(1), or clauses (i) 

12 through (v) of section 428(b)(9), into a Federal Di13 rect Consolidation Loan and selects an income-based 

14 repayment plan under section 493C(c) or a fixed re15 payment plan under section 493E for the loan. 

16 ‘‘(b) LIMITATION.—The interest rate for a loan eligi17 ble for the incentive under subsection (a) may be reduced 

18 only once under this section. 

19 ‘‘(c) RULES AND WAIVERS.—The Secretary shall pro20 mulgate rules carrying out the incentive program estab21 lished under this section. In promulgating such rules, the 

22 Secretary may waive the application of— 

23 ‘‘(1) subchapter I of chapter 35 of title 44, 

24 United States Code (commonly known as the ‘Paper25 work Reduction Act’); 


pamtmann on DSKBC07HB2PROD with BILLS
32 

•S 3953 IS

1 ‘‘(2) the master calendar requirements under 

2 section 482; 

3 ‘‘(3) negotiated rulemaking under section 492; 

4 and 

5 ‘‘(4) the requirement to publish the notices re6 lated to the system of records of the agency before 

7 implementation required under paragraphs (4) and 

8 (11) of section 552a(e) of title 5, United States 

9 Code (commonly known as the ‘Privacy Act of 

10 1974’), except that the notices shall be published not 

11 later than 180 days after the date of implementation 

12 of this Act.’’. 

13 SEC. 105. STUDY AND PROCEDURES ON DETERMINING FAM14 ILY SIZE. 

15 (a) IN GENERAL.—The Secretary of Education, act16 ing jointly with the Secretary of the Treasury, shall— 

17 (1) not later than 1 year after the date of en18 actment of this Act, publish, in the Federal Register, 

19 notice of the Secretary’s intent to conduct a study 

20 on the effect of using data from the Internal Rev21 enue Service such as personal exemptions, filing sta22 tus, or child tax credits, as proxies for family size 

23 in an income-driven repayment plan, and invite pub24 lic comment regarding the study; 


pamtmann on DSKBC07HB2PROD with BILLS
33 

•S 3953 IS

1 (2) after reviewing any public comments pro2 vided under paragraph (1), conduct the study and 

3 publish the results of the study in the Federal Reg4 ister; 

5 (3) use the results of the study conducted under 

6 paragraph (1) to develop procedures for determining 

7 family size for the automatic recertification of in8 come for an income-driven repayment plan in a man9 ner that minimizes burdens and unintended harm to 

10 borrowers; 

11 (4) publish the procedures developed under 

12 paragraph (3) in the Federal Register; and 

13 (5) after a notice and comment period on such 

14 procedures, use such comments to finalize the proce15 dures. 

16 (b) SPECIFICATIONS.—The study conducted under 

17 subsection (a) shall— 

18 (1) be completed, with the results published 

19 pursuant to subsection (a)(2), not later than 3 years 

20 after the date of enactment of this Act; 

21 (2) determine how closely personal exemptions, 

22 filing status, or child tax credits match the family 

23 size that borrowers report on their income-driven re24 payment plan request form; 


pamtmann on DSKBC07HB2PROD with BILLS
34 

•S 3953 IS

1 (3) compare the borrower’s actual monthly pay2 ment amount with the monthly payment amount 

3 borrowers would have using family size information 

4 derived from tax returns; 

5 (4) include data from tax year 2018 or later tax 

6 years; and 

7 (5) use data from more than one year, where 

8 possible, to analyze how much family size changes 

9 over time. 

10 (c) DEFINITION.—The term ‘‘income-driven repay11 ment plan’’ means any of the following authorized under 

12 the Higher Education Act of 1965 (20 U.S.C. 1001 et 

13 seq.): 

14 (1) The income-contingent repayment plan. 

15 (2) The income-based repayment plan. 

16 (3) The PAYE repayment plan. 

17 (4) The REPAYE repayment plan. 

18 TITLE II—ENDING INTEREST 

19 CAPITALIZATION AND ORIGI20 NATION FEES 

21 SEC. 201. ENDING INTEREST CAPITALIZATION FOR FED22 ERAL DIRECT LOANS. 

23 Section 455 (20 U.S.C. 1087e) is amended— 

24 (1) in subsection (b)— 


pamtmann on DSKBC07HB2PROD with BILLS
35 

•S 3953 IS

1 (A) in the subsection heading, by inserting 

2 ‘‘and Practices’’ after ‘‘Rate’’; and 

3 (B) by adding at the end the following: 

4 ‘‘(11) INTEREST PRACTICES.— 

5 ‘‘(A) IN GENERAL.—Beginning on the ef6 fective date of the Affordable Loans for Any 

7 Student Act, interest on a loan made under this 

8 part shall accrue and only be added to the bal9 ance of interest due on the loan, and shall not 

10 ever be capitalized. 

11 ‘‘(B) NO CAPITALIZATION OF INTEREST

12 DURING IN-SCHOOL OR GRACE PERIODS.— 

13 ‘‘(i) IN GENERAL.—Beginning on the 

14 effective date of the Affordable Loans for 

15 Any Student Act, interest on loans made 

16 under this part for which payments of 

17 principal are not required during the in18 school and grace periods or for which pay19 ments are deferred in accordance with sec20 tions 427(a)(2)(C) and 428(b)(1)(M) shall 

21 accrue and be added to the balance of in22 terest due from the borrower when the 

23 loan enters repayment, but shall not ever 

24 be capitalized. 


pamtmann on DSKBC07HB2PROD with BILLS
36 

•S 3953 IS

1 ‘‘(ii) NOTICE REQUIREMENT.—The 

2 Secretary shall adjust any forbearance no3 tice required in accordance with section 

4 428(a)(3)(A)(iii) to reflect the availability 

5 of the pause payment process pursuant to 

6 section 460B and the treatment of interest 

7 under such section. 

8 ‘‘(C) LIMITED RETROACTIVITY.—For a 

9 borrower of a loan made under this part on or 

10 before the effective date of the Affordable 

11 Loans for Any Student Act that is in a status, 

12 on the day before such effective date, that in13 volves interest capitalization, such loan shall 

14 have capitalization pro-rated to the effective 

15 date of such Act, but shall not be subject to 

16 further capitalization after the effective date of 

17 such Act.’’; and 

18 (2) in subsection (e)(5)— 

19 (A) by inserting ‘‘(which, beginning after 

20 the effective date of the Affordable Loans for 

21 Any Student Act, shall not be capitalized)’’ 

22 after ‘‘accrued interest’’; and 

23 (B) by striking the second sentence. 


pamtmann on DSKBC07HB2PROD with BILLS
37 

•S 3953 IS

1 SEC. 202. ELIMINATION OF ORIGINATION FEES FOR FED2 ERAL DIRECT LOANS. 

3 (a) REPEAL OF ORIGINATION FEES.—Subsection (c) 

4 of section 455 (20 U.S.C. 1087e(c)) is repealed. 

5 (b) EFFECTIVE DATE.—The amendment made by 

6 subsection (a) shall apply with respect to loans made 

7 under part D of title IV of the Higher Education Act of 

8 1965 (20 U.S.C. 1087a et seq.) for which the first dis9 bursement of principal is made on or after July 1, 2022. 

10 TITLE III—PROVIDING ASSIST11 ANCE IN SITUATIONS OF BOR12 ROWER DISTRESS 

13 SEC. 301. LIMITS ON SEIZING INCOME FOR DEBT. 

14 Part D of title IV (20 U.S.C. 1087a et seq.) is 

15 amended by adding at the end the following: 

16 ‘‘SEC. 460A. LIMITS ON SEIZING INCOME FOR DEBT RELAT17 ING TO FEDERAL STUDENT LOANS. 

18 ‘‘(a) DEFINITIONS.—In this section— 

19 ‘‘(1) the term ‘adjusted gross income’ has the 

20 meaning given the term in section 62 of the Internal 

21 Revenue Code of 1986; and 

22 ‘‘(2) the term ‘poverty line’ means the poverty 

23 line (as defined by the Office of Management and 

24 Budget and revised annually in accordance with sec25 tion 673(2) of the Community Services Block Grant 


pamtmann on DSKBC07HB2PROD with BILLS
38 

•S 3953 IS

1 Act (42 U.S.C. 9902(2))) applicable to a family of 

2 the size involved. 

3 ‘‘(b) LIMITATION ON COLLECTION.— 

4 ‘‘(1) IN GENERAL.—Notwithstanding any other 

5 provision of law, any entity engaged in the collection 

6 of debts relating to loans made under this title may 

7 not take any action to cause, or seek to cause, the 

8 collection of such a debt that is taken from the 

9 wages, Federal benefits, or other amounts due to a 

10 borrower through garnishment, deduction, offset, or 

11 seizure in an amount on a monthly basis that is 

12 more than the amount described in paragraph (2). 

13 ‘‘(2) CALCULATION.—The amount described in 

14 this paragraph is the amount obtained by calculating 

15 what the monthly repayment amount would be for 

16 loans made under this title, with respect to the bor17 rower, under the income-based repayment plan 

18 under section 493C(c). 

19 ‘‘(3) PRESUMPTION.—For purposes of this sec20 tion, if an entity described in paragraph (1) is un21 able to determine the family size of a borrower after 

22 taking reasonable steps to collect the information 

23 necessary to do so, that person shall presume that 

24 the family size of the borrower is 1 individual. 


pamtmann on DSKBC07HB2PROD with BILLS
39 

•S 3953 IS

1 ‘‘(c) COMMUNICATIONS.—Any communication by an 

2 entity described in subsection (b)(1) that is for the pur3 pose of seizing income of a consumer for debt that relates 

4 to a loan made under this title shall— 

5 ‘‘(1) be considered— 

6 ‘‘(A) an attempt to collect a debt; and 

7 ‘‘(B) conduct in connection with the collec8 tion of a debt for the purposes of this title; and 

9 ‘‘(2) contain a notice to the borrower that, con10 sistent with the procedures for rehabilitating a loan 

11 pursuant to section 428F(a) or consolidating loans 

12 out of default as described in section 

13 428C(a)(3)(B)(i)(V), the borrower may exit default 

14 and reenter current repayment status (as defined in 

15 section 428(l)(2)(C)) with a similar monthly pay16 ment amount on an income-based repayment plan 

17 under section 493C(c) and thereby obtain the full 

18 flexibility and benefits of such status, including the 

19 ability to adjust family size and make qualifying 

20 payments for purposes of repayment or cancellation 

21 of any outstanding balance of principal and interest 

22 due on a loan (as described in section 493C(b)(7)). 

23 ‘‘(d) REMEDIES.— 

24 ‘‘(1) FIRST TIER.—The Secretary may impose a 

25 civil penalty on an entity for a violation of this secVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00039 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
40 

•S 3953 IS

1 tion not to exceed $5,000 for each day during which 

2 such violation continues. 

3 ‘‘(2) SECOND TIER.—Notwithstanding para4 graph (1), the Secretary may impose a civil penalty 

5 on an entity that recklessly engages in a violation of 

6 this section not to exceed $25,000 for each day dur7 ing which such violation continues. 

8 ‘‘(3) THIRD TIER.—Notwithstanding para9 graphs (1) and (2), the Secretary may impose a civil 

10 penalty on an entity that knowingly violates this sec11 tion not to exceed $1,000,000 for each day during 

12 which such violation continues. 

13 ‘‘(4) NO EXEMPLARY OR PUNITIVE DAMAGES.— 

14 Nothing in this subsection shall be construed as au15 thorizing the imposition of exemplary or punitive 

16 damages. 

17 ‘‘(5) ENTITIES SUBJECT TO PENALTY.—An en18 tity subject to a penalty under this subsection may 

19 include a contractor or agent of the Department.’’. 

20 SEC. 302. ALLOWING FOR MULTIPLE LOAN REHABILI21 TATIONS. 

22 (a) FFEL LOANS.—Section 428F(a)(5) (20 U.S.C. 

23 1078–6(a)(5)) is amended by striking ‘‘one time per loan’’ 

24 and inserting ‘‘2 times per loan’’. 


pamtmann on DSKBC07HB2PROD with BILLS
41 

•S 3953 IS

1 (b) DIRECT LOANS.—Section 455(d) (20 U.S.C. 

2 1087e(d)), as amended by section 103, is further amended 

3 by adding at the end the following: 

4 ‘‘(8) LOAN REHABILITATION.—In carrying out 

5 the process for loan rehabilitation described in sec6 tion 428F(a)(5) with respect to loans made under 

7 this part and in accordance with subsection (a), the 

8 Secretary shall allow a borrower to obtain the bene9 fits available under such section not more than 2 

10 times per loan.’’. 

11 SEC. 303. PAUSE PAYMENT PROCESS. 

12 (a) ESTABLISHMENT OF PAUSE PAYMENT PROC13 ESS.—Part D of title IV (20 U.S.C. 1087a et seq.), as 

14 amended by section 301, is further amended by adding 

15 at the end the following: 

16 ‘‘SEC. 460B. PAUSE PAYMENT PROCESS. 

17 ‘‘(a) IN GENERAL.—The Secretary shall establish a 

18 single, streamlined pause payment process available in a 

19 single application with respect to loans made under this 

20 part that replaces the deferment and forbearance options 

21 and their respective applications that are available to bor22 rowers before the effective date of the Affordable Loans 

23 for Any Student Act and provides temporary relief from 

24 repayment of such loans in accordance with this section. 


pamtmann on DSKBC07HB2PROD with BILLS
42 

•S 3953 IS

1 ‘‘(b) APPLICATION FOR RELIEF.—Notwithstanding 

2 any other provision of this Act, a borrower of a loan made 

3 under this part that desires to receive temporary relief 

4 from repayment with respect to such loan shall request 

5 relief in accordance with the pause payment process estab6 lished by the Secretary under subsection (a), which shall 

7 include the options to select a temporary cessation of pay8 ments and to make smaller payments than the monthly 

9 payments required under the borrower’s repayment plan. 

10 ‘‘(c) PAUSE PAYMENT.— 

11 ‘‘(1) IN GENERAL.—A borrower of a loan made 

12 under this part who meets the requirements de13 scribed in paragraph (2) shall be eligible for a pause 

14 payment, during which periodic installments of prin15 cipal need not be paid, and interest— 

16 ‘‘(A) shall not accrue, in the case of a— 

17 ‘‘(i) Federal Direct Stafford Loan; or 

18 ‘‘(ii) a Federal Direct Consolidation 

19 Loan that consolidated only Federal Direct 

20 Stafford Loans, or a combination of such 

21 loans and Federal Stafford Loans for 

22 which the student borrower received an in23 terest subsidy under section 428; or 

24 ‘‘(B) shall accrue and be added to the bal25 ance of interest due but not be capitalized, or 


pamtmann on DSKBC07HB2PROD with BILLS
43 

•S 3953 IS

1 be paid by the borrower, in the case of a Fed2 eral Direct PLUS Loan, a Federal Direct Un3 subsidized Stafford Loan, or a Federal Direct 

4 Consolidation Loan not described in subpara5 graph (A)(ii). 

6 ‘‘(2) ELIGIBILITY.—A borrower of a loan made 

7 under this part shall be eligible for a pause payment 

8 during any period— 

9 ‘‘(A) during which— 

10 ‘‘(i) the borrower is carrying at least 

11 one-half the normal full-time work load for 

12 the course of study that the borrower is 

13 pursuing, as determined by the eligible in14 stitution (as such term is defined in sec15 tion 435(a)) the student is attending; or 

16 ‘‘(ii) in the case of a parent borrower, 

17 the borrower or the student on whose be18 half the loan was borrowed is carrying at 

19 least one-half the normal full-time work 

20 load, in accordance with clause (i); 

21 ‘‘(B) during which the borrower is pur22 suing a course of study pursuant to a graduate 

23 fellowship program approved by the Secretary; 


pamtmann on DSKBC07HB2PROD with BILLS
44 

•S 3953 IS

1 ‘‘(C) during which the borrower is serving 

2 in a medical or dental internship or residency 

3 program; 

4 ‘‘(D) during which the borrower is in a re5 habilitation training program for individuals 

6 with disabilities approved by the Secretary; 

7 ‘‘(E) during which the borrower— 

8 ‘‘(i) is serving on active duty during a 

9 war or other military operation or national 

10 emergency and for the 180-day period fol11 lowing the demobilization date for the serv12 ice; or 

13 ‘‘(ii) qualifies for partial repayment of 

14 the borrower’s loans under a provision of 

15 chapter 109 or 1609 of title 10, United 

16 States Code; 

17 ‘‘(F) during which the borrower is per18 forming qualifying National Guard duty during 

19 a war or other military operation or national 

20 emergency and for the 180-day period following 

21 the demobilization date for the service; 

22 ‘‘(G) during which the borrower is serving 

23 in— 

24 ‘‘(i) an approved national service posi25 tion (as defined in section 101 of the NaVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00044 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
45 

•S 3953 IS

1 tional and Community Service Act of 1990 

2 (42 U.S.C. 12511)) in an Americorps pro3 gram (defined for purposes of this sub4 paragraph as a program carried out under 

5 subtitle C or E of title I of the National 

6 and Community Service Act of 1990 (42 

7 U.S.C. 12571 et seq., 12611 et seq.) or 

8 title I of the Domestic Volunteer Service 

9 Act of 1973 (42 U.S.C. 4951 et seq.)); 

10 ‘‘(ii) in the Peace Corps; or 

11 ‘‘(iii) in a teaching position that would 

12 qualify for teacher loan forgiveness under 

13 section 428J or 460; 

14 ‘‘(H) not in excess of a total period of 3 

15 years of repayment of a loan during which the 

16 Secretary determines, in accordance with regu17 lations prescribed under section 435(o), that 

18 the borrower has experienced or will experience 

19 an economic hardship, such as experiencing fi20 nancial difficulties, having unexpected or sig21 nificant medical expenses, or being unable to 

22 find full-time employment; 

23 ‘‘(I) during which a borrower’s ability to 

24 make payments, as determined by the Sec25 retary, has been adversely affected by— 


pamtmann on DSKBC07HB2PROD with BILLS
46 

•S 3953 IS

1 ‘‘(i) any major disaster or emergency 

2 declared by the President under section 

3 401 or 501, respectively, of the Robert T. 

4 Stafford Disaster Relief and Emergency 34 

5 Assistance Act (42 U.S.C. 5170, 5191); 

6 ‘‘(ii) a local emergency, as declared by 

7 the appropriate government agency; or 

8 ‘‘(iii) a military mobilization; 

9 ‘‘(J) during which the borrower is awaiting 

10 a determination by the Secretary of the bor11 rower’s request for a pause payment, change in 

12 repayment plan, loan forgiveness or cancella13 tion, or consolidation loan; or 

14 ‘‘(K) during which the borrower is experi15 encing other exceptional circumstances for 

16 which pause payment under this section is in 

17 the best interest of the borrower, as determined 

18 by the Secretary through regulation.’’. 

19 (b) CONFORMING AMENDMENTS.—Section 455 (20 

20 U.S.C. 1087e) is amended— 

21 (1) in subsection (e)(7)(B)(i), by striking ‘‘is in 

22 deferment’’ and inserting ‘‘is under pause payment 

23 pursuant to section 460B’’; 

24 (2) by striking subsection (f) and inserting the 

25 following: 


pamtmann on DSKBC07HB2PROD with BILLS
47 

•S 3953 IS

1 ‘‘(f) øreserved¿’’; and 

2 (3) in subsection (l)— 

3 (A) by striking ‘‘PROGRAM.—’’ and all 

4 that follows through ‘‘Using funds’’ and insert5 ing the following: ‘‘PROGRAM.—USING

6 FUNDS’’; and 

7 (B) by striking paragraph (2). 

8 SEC. 304. AUTOMATIC ENROLLMENT INTO INCOME-BASED 

9 REPAYMENT FOR BORROWERS WHO ARE DE10 LINQUENT ON LOANS AND FOR BORROWERS 

11 WHO REHABILITATE DEFAULTED LOANS. 

12 (a) NOTIFICATION AND AUTOMATIC ENROLLMENT

13 PROCEDURES.—Section 455(d) (20 U.S.C. 1087e(d)), as 

14 amended by sections 103 and 302, is further amended by 

15 adding at the end the following: 

16 ‘‘(9) NOTIFICATION AND AUTOMATIC ENROLL17 MENT PROCEDURES FOR BORROWERS WHO ARE DE18 LINQUENT ON LOANS.— 

19 ‘‘(A) AUTHORITY TO OBTAIN INCOME IN20 FORMATION.— 

21 ‘‘(i) IN GENERAL.—In the case of any 

22 borrower who is at least 60 days delin23 quent on a loan made under this part, the 

24 Secretary may obtain such information as 

25 is reasonably necessary regarding the inVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00047 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
48 

•S 3953 IS

1 come and family size of the borrower (and 

2 the borrower’s spouse, if applicable). 

3 ‘‘(ii) AVAILABILITY OF RETURNS AND

4 RETURN INFORMATION.—Returns and re5 turn information (as defined in section 

6 6103 of the Internal Revenue Code of may 

7 be obtained under this subparagraph only 

8 to the extent authorized by section 

9 6103(l)(13) of such Code). 

10 ‘‘(B) BORROWER NOTIFICATION.—With re11 spect to each borrower of a loan made under 

12 this part who is at least 60 days delinquent on 

13 such loan and who has not been subject to the 

14 procedures under this paragraph for such loan 

15 in the preceding 120 days, the Secretary shall, 

16 as soon as practicable after such 60-day delin17 quency, provide to the borrower the following: 

18 ‘‘(i) Notification that the borrower is 

19 at least 60 days delinquent on at least 1 

20 loan under this part, and a description of 

21 all delinquent loans under this part, and 

22 nondelinquent loans under this part, of the 

23 borrower. 

24 ‘‘(ii) A brief description of the repay25 ment plans for which the borrower is eligiVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00048 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
49 

•S 3953 IS

1 ble and the borrower’s loans made under 

2 this part, and loans made, insured, or 

3 guaranteed under part B or E, that may 

4 be eligible for such plans, based on infor5 mation available to the Secretary. 

6 ‘‘(iii) Clear and simple instructions on 

7 how to select the repayment plans. 

8 ‘‘(iv) The amount of monthly pay9 ments for the loans made under this part, 

10 and any loans made, insured, or guaran11 teed under part B or E, under the repay12 ment plans for which the borrower is eligi13 ble, based on information available to the 

14 Secretary, including, if the income infor15 mation of the borrower is available to the 

16 Secretary under subparagraph (A)— 

17 ‘‘(I) the amount of the monthly 

18 payment under the income-based re19 payment plan under section 493C(c) 

20 for which the borrower is eligible for 

21 the borrower’s loans made under this 

22 part, based on such income informa23 tion; and 

24 ‘‘(II) the income, family size, tax 

25 filing status, and tax year information 


pamtmann on DSKBC07HB2PROD with BILLS
50 

•S 3953 IS

1 on which each the monthly payment is 

2 based. 

3 ‘‘(v) An explanation that the Sec4 retary shall take the actions under sub5 paragraph (C) with respect to such bor6 rower, if— 

7 ‘‘(I) the borrower is 120 days de8 linquent on one or more loans under 

9 this part and has not selected a new 

10 repayment plan for the borrower’s 

11 loans under this part; and 

12 ‘‘(II) in the case of such a bor13 rower whose repayment plan for any 

14 loans made under this part is not an 

15 income-based repayment plan under 

16 section 493C(c), the monthly pay17 ments under such repayment plan are 

18 higher than such monthly payments 

19 would be under an income-based re20 payment plan for such loans. 

21 ‘‘(vi) Instructions on updating the in22 formation of the borrower obtained under 

23 subparagraph (A). 

24 ‘‘(C) SECRETARY’S INITIAL SELECTION OF

25 PLAN.—With respect to each borrower deVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00050 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
51 

•S 3953 IS

1 scribed in subparagraph (B) who has a repay2 ment plan for loans made under this part that 

3 meets the requirements of clause (v)(II) of sub4 paragraph (B), who has not selected a new re5 payment plan for such loans in accordance with 

6 the notice received under such subparagraph, 

7 and who is at least 120 days delinquent on such 

8 a loan, the Secretary shall, as soon as prac9 ticable— 

10 ‘‘(i) in a case in which any of the bor11 rower’s loans made under part B or E are 

12 eligible for an income-based repayment 

13 plan under section 493C(c), provide the 

14 borrower with the income-based repayment 

15 plan; and 

16 ‘‘(ii) in a case in which none of the 

17 borrower’s loans made under part B or E 

18 are eligible for an income-based repayment 

19 plan under section 493C(c), notify the bor20 rower of the actions, if any, the borrower 

21 may take for such loans to become eligible 

22 for such a plan. 

23 ‘‘(D) SECRETARY’S ADDITIONAL SELEC24 TION OF PLAN.— 


pamtmann on DSKBC07HB2PROD with BILLS
52 

•S 3953 IS

1 ‘‘(i) IN GENERAL.—With respect to 

2 each borrower of a loan made under this 

3 part who selects a new repayment plan in 

4 accordance with the notice received under 

5 subparagraph (B) and who continues to be 

6 delinquent on such loan for a period de7 scribed in clause (ii), the Secretary shall, 

8 as soon as practicable after such period, 

9 carry out the procedures described in sub10 paragraph (C) for the borrower’s loans 

11 made under this part, if such procedures 

12 would result in lower monthly repayment 

13 amounts on such loan. 

14 ‘‘(ii) DESCRIPTION OF PERIOD.—The 

15 duration of the period described in clause 

16 shall be the amount of time that the Sec17 retary determines is sufficient to indicate 

18 that the borrower may benefit from repay19 ing such loan under a new repayment plan, 

20 but in no case shall such period be less 

21 than 60 days. 

22 ‘‘(E) OPT-OUT.—A borrower of a loan 

23 made under this part shall have the right to opt 

24 out of the procedures under this paragraph. 


pamtmann on DSKBC07HB2PROD with BILLS
53 

•S 3953 IS

1 ‘‘(F) PROCEDURES.—The Secretary shall 

2 establish procedures as are necessary to effec3 tively implement this paragraph. 

4 ‘‘(10) NOTIFICATION AND AUTOMATIC ENROLL5 MENT PROCEDURES FOR BORROWERS WHO ARE RE6 HABILITATING DEFAULTED LOANS.— 

7 ‘‘(A) AUTHORITY TO OBTAIN INCOME IN8 FORMATION.— 

9 ‘‘(i) IN GENERAL.—In the case of any 

10 borrower who is rehabilitating a loan made 

11 under this part pursuant to section 

12 428F(a), the Secretary may obtain such 

13 information as is reasonably necessary re14 garding the income and family size of the 

15 borrower (and the borrower’s spouse, if ap16 plicable). 

17 ‘‘(ii) AVAILABILITY OF RETURNS AND

18 RETURN INFORMATION.—Returns and re19 turn information (as defined in section 

20 6103 of the Internal Revenue Code of may 

21 be obtained under this subparagraph only 

22 to the extent authorized by section 

23 6103(l)(13) of such Code). 

24 ‘‘(B) BORROWER NOTIFICATION.—Not 

25 later than 30 days after a borrower makes the 


pamtmann on DSKBC07HB2PROD with BILLS
54 

•S 3953 IS

1 6th payment required for the loan rehabilitation 

2 described in subparagraph (A), the Secretary 

3 shall notify the borrower of the process under 

4 subparagraph (C) with respect to such loan. 

5 ‘‘(C) SECRETARY’S AUTOMATIC ENROLL6 MENT.—With respect to each borrower who has 

7 made the 9th payment required for the loan re8 habilitation described in subparagraph (A) and 

9 is eligible for the income-based repayment plan 

10 under section 493C(c), the Secretary shall, as 

11 soon as practicable after such payment, provide 

12 the borrower with the income-based repayment 

13 plan. 

14 ‘‘(D) OPT-OUT.—A borrower of a loan 

15 made under this part shall have the right to opt 

16 out of the procedures for enrollment in an in17 come-based repayment plan under this para18 graph. 

19 ‘‘(E) PROCEDURES.—The Secretary shall 

20 establish procedures as are necessary to effec21 tively implement this paragraph.’’. 

22 (b) EFFECTIVE DATE.—The amendments made by 

23 subsection (a) shall— 


pamtmann on DSKBC07HB2PROD with BILLS
55 

•S 3953 IS

1 (1) take effect as soon as the Secretary of Edu2 cation determines practicable after the Secretary fi3 nalizes the procedures under section 105; and 

4 (2) apply to all borrowers of loans made under 

5 part D of title IV of the Higher Education Act of 

6 1965 (20 U.S.C. 1087a et seq.). 

7 SEC. 305. SEPARATING JOINT CONSOLIDATION LOANS. 

8 (a) IN GENERAL.—Section 455(g) (20 U.S.C. 

9 1087e(g)), as amended by section 104, is further amended 

10 by adding at the end the following: 

11 ‘‘(3) SEPARATING JOINT CONSOLIDATION

12 LOANS.— 

13 ‘‘(A) IN GENERAL.—A married couple, or 

14 2 individuals who were previously a married 

15 couple, and who received a joint consolidation 

16 loan as such married couple under subpara17 graph (C) of section 428C(a)(3) (as such sub18 paragraph was in effect on or before June 30, 

19 2006), may apply to the Secretary for each in20 dividual borrower in the married couple (or pre21 viously married couple) to receive a separate 

22 Federal Direct Consolidation Loan under this 

23 part— 

24 ‘‘(i) that shall— 


pamtmann on DSKBC07HB2PROD with BILLS
56 

•S 3953 IS

1 ‘‘(I) unless the Secretary receives 

2 notice of an agreement described in 

3 subclause (II)(aa), be equal to the 

4 sum of— 

5 ‘‘(aa) the unpaid principal 

6 and accrued unpaid interest of 

7 the percentage of the joint con8 solidation loan that, as of the day 

9 before such joint consolidation 

10 loan was made, was attributable 

11 to the loans of the individual bor12 rower for whom such separate 

13 consolidation loan is being made; 

14 and 

15 ‘‘(bb) any other loans de16 scribed in section 428C(a)(4) 

17 that such individual borrower se18 lects for consolidation under this 

19 part; or 

20 ‘‘(II) be equal to the sum of— 

21 ‘‘(aa) the unpaid principal 

22 and accrued unpaid interest of 

23 the percentage of the joint con24 solidation loan that, as of the 

25 date of application under this 


pamtmann on DSKBC07HB2PROD with BILLS
57 

•S 3953 IS

1 paragraph, the married couple 

2 (or previously married couple) 

3 agrees shall be considered attrib4 utable to the loans of the indi5 vidual borrower for whom such 

6 separate consolidation loan is 

7 being made; and 

8 ‘‘(bb) any other loans de9 scribed in section 428C(a)(4) 

10 that such individual borrower se11 lects for consolidation under this 

12 part; 

13 ‘‘(ii) the proceeds of which shall be 

14 paid by the Secretary to the holder or 

15 holders— 

16 ‘‘(I) of the joint consolidation 

17 loan for the purpose of discharging 

18 the liability on the percentage of such 

19 joint consolidation loan described in 

20 subclause (I)(aa) or (II)(aa) of clause 

21 (i); and 

22 ‘‘(II) of the loans selected for 

23 consolidation under subclause (I)(bb) 

24 or of clause (i) for the purpose of dis25 charging the liability on such loans; 


pamtmann on DSKBC07HB2PROD with BILLS
58 

•S 3953 IS

1 ‘‘(iii) except as otherwise provided in 

2 this paragraph, that has the same terms 

3 and conditions, and rate of interest as the 

4 joint consolidation loan, except if other 

5 loans are included in such Federal Direct 

6 Consolidation Loan after the date the Fed7 eral Direct Consolidation Loan is first 

8 made under this paragraph; 

9 ‘‘(iv) for which any payment made 

10 under subsection (m)(1)(A) on the joint 

11 consolidation loan during a period in which 

12 the individual borrower for whom such sep13 arate consolidation loan is being made was 

14 employed in a public service job described 

15 in subsection (m)(1)(B) shall be treated as 

16 if such payment were made on such sepa17 rate consolidation loan; and 

18 ‘‘(v) for which any payment made 

19 under an income contingent repayment 

20 plan under subsection (d)(1)(D), or an in21 come-based repayment plan under para22 graph (1)(E) or (2)(A)(ii) of subsection 

23 (d), on the joint consolidation loan shall be 

24 treated as if such payment were made on 

25 such separate consolidation loan. 


pamtmann on DSKBC07HB2PROD with BILLS
59 

•S 3953 IS

1 ‘‘(B) APPLICATION FOR SEPARATE DIRECT

2 CONSOLIDATION LOANS.— 

3 ‘‘(i) JOINT APPLICATION.—Except as 

4 provided in clause (ii), to receive separate 

5 consolidation loans under subparagraph 

6 (A), both individual borrowers in a married 

7 couple (or previously married couple) shall 

8 jointly apply under such subparagraph. 

9 ‘‘(ii) SEPARATE APPLICATION.—An 

10 individual borrower in a married couple (or 

11 previously married couple) may apply for a 

12 separate consolidation loan under subpara13 graph (A) separately and without regard to 

14 whether or when the other individual bor15 rower in the married couple (or previously 

16 married couple) applies under such sub17 paragraph, and shall be relieved of any re18 maining liability for the joint consolidation 

19 loan, in a case in which— 

20 ‘‘(I) the individual borrower has 

21 experienced from the other individual 

22 borrower— 

23 ‘‘(aa) domestic violence (as 

24 defined in section 40002(a) of 


pamtmann on DSKBC07HB2PROD with BILLS
60 

•S 3953 IS

1 the Violence Against Women Act 

2 of 1994 (34 U.S.C. 12291(a))); 

3 ‘‘(bb) economic abuse (in4 cluding behaviors that control 

5 such borrower’s ability to ac6 quire, use, and maintain access 

7 to money, credit, or the joint fi8 nancial obligations of both bor9 rowers); or 

10 ‘‘(cc) other exceptional cir11 cumstances, as determined by the 

12 Secretary; and 

13 ‘‘(II) the Secretary determines 

14 that authorizing each individual bor15 rower to apply separately under sub16 paragraph (A) would be in the best 

17 fiscal interests of the Federal Govern18 ment, including by reducing the risk 

19 of delinquency or default. 

20 ‘‘(C) BORROWER ELIGIBILITY.—Notwith21 standing section 428C(a)(3)(A), the Secretary 

22 shall provide a consolidation loan under this 

23 part to each borrower who— 

24 ‘‘(i) applies for such loan under sub25 paragraph (A); and 


pamtmann on DSKBC07HB2PROD with BILLS
61 

•S 3953 IS

1 ‘‘(ii) meets the requirements of sub2 paragraphs (A) and (B).’’. 

3 (b) CONFORMING AMENDMENT.—Section 

4 428C(a)(3)(B)(i)(V) (20 U.S.C. 1078–3(3)(B)(i)(V)) is 

5 amended— 

6 (1) by striking ‘‘or’’ at the end of item (bb); 

7 (2) by striking the period at the end of item 

8 (cc) and inserting ‘‘; or’’; and 

9 (3) by adding at the end the following: 

10 ‘‘(dd) for the purpose of sep11 arating a joint consolidation loan 

12 into 2 separate Federal Direct 

13 Consolidation Loans under sec14 tion 455(g)(3).’’. 

15 SEC. 306. REMOVING THE COLLECTION COST REQUIRE16 MENT. 

17 (a) REMOVAL OF REQUIREMENT.—Section 

18 484A(b)(1) (20 U.S.C. 1091a(b)(1)) is amended by strik19 ing ‘‘shall be required to pay, in addition to other charges 

20 specified in this title, reasonable collection costs’’ and in21 serting ‘‘shall not be required to pay collection costs’’. 

22 (b) REPAYMENT AFTER DEFAULT.—Section 

23 455(d)(6) (20 U.S.C. 1087e(d)(6)), as redesignated under 

24 section 103(b), is amended by striking ‘‘to—’’ and all that 

25 follows through the period at the end and inserting ‘‘to 


pamtmann on DSKBC07HB2PROD with BILLS
62 

•S 3953 IS

1 repay the loan pursuant to an income-based repayment 

2 plan under section 493C(c).’’. 

3 TITLE IV—IMPROVING LOAN IN4 FORMATION AND COUN5 SELING 

6 SEC. 401. STUDENT LOAN CONTRACT; SIMPLIFYING LOAN 

7 DISCLOSURES. 

8 (a) STUDENT LOAN CONTRACT.—Section 455 (20 

9 U.S.C. 1087e), as amended by section 202, is further 

10 amended by inserting after subsection (b) the following: 

11 ‘‘(c) STUDENT LOAN CONTRACT; SIMPLIFYING LOAN

12 DISCLOSURES.— 

13 ‘‘(1) STUDENT LOAN CONTRACT.— 

14 ‘‘(A) IN GENERAL.—Any master promis15 sory note form described in section 

16 432(m)(1)(D) that is developed or used for cov17 ered loans shall be referred to as a ‘student 

18 loan contract’. 

19 ‘‘(B) CLARIFICATION ON USE.—Notwith20 standing section 432(m)(1)(D)(i), each student 

21 loan contract for a covered loan shall— 

22 ‘‘(i) not be entered into by a student 

23 unless the student has completed all re24 quired counseling related to such loan, inVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00062 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
63 

•S 3953 IS

1 cluding counseling required under section 

2 485(l); 

3 ‘‘(ii) be signed by the student entering 

4 such student loan contract after completion 

5 of such counseling; 

6 ‘‘(iii) be signed by the student during 

7 the first award year of such student’s en8 rollment at an institution; 

9 ‘‘(iv) be valid for each award year 

10 after the award year described in clause 

11 (iii) in which the student remains enrolled 

12 at the same institution; and 

13 ‘‘(v) include options for the student to 

14 enter both the student’s current contact in15 formation and permanent contact informa16 tion that is likely to remain valid upon the 

17 student’s exit from the institution. 

18 ‘‘(C) COVERED LOAN.— 

19 ‘‘(i) IN GENERAL.—In this subsection, 

20 the term ‘covered loan’ means a loan made 

21 under this part on or after the effective 

22 date of the Affordable Loans for Any Stu23 dent Act, except with respect to a borrower 

24 described in clause (ii). 


pamtmann on DSKBC07HB2PROD with BILLS
64 

•S 3953 IS

1 ‘‘(ii) EXCEPTION.—A borrower is de2 scribed in this clause if the loan made 

3 under this part on or after the effective 

4 date of the Affordable Loans for Any Stu5 dent Act with respect to such borrower is 

6 for the award year during which the Af7 fordable Loans for Any Student Act is en8 acted and the borrower has already taken 

9 out a loan under this part (other than a 

10 Federal Direct Consolidation Loan) for 

11 such award year (including any such loan 

12 for attendance at another institution from 

13 which the student transferred or in which 

14 the student had previously enrolled). 

15 ‘‘(2) LOAN DISCLOSURES.—For loans made 

16 under this part for periods of enrollment beginning 

17 on or after the effective date of the Affordable 

18 Loans for Any Student Act, the Secretary shall take 

19 such steps as are necessary to streamline the stu20 dent loan disclosure requirements under this Act. 

21 The Secretary shall ensure that information required 

22 to be disclosed to a student who is applying for, re23 ceiving, or preparing to repay a loan under this part 

24 shall be consumer-tested and delivered in a manner 

25 that— 


pamtmann on DSKBC07HB2PROD with BILLS
65 

•S 3953 IS

1 ‘‘(A) reduces and simplifies the paperwork 

2 students are required to complete; 

3 ‘‘(B) limits the number of times a student 

4 is presented with disclosures by incorporating 

5 the streamlined disclosures into required stu6 dent loan counseling under section 485(l), the 

7 student loan contract under this subsection, or 

8 both; and 

9 ‘‘(C) is effective in helping the student un10 derstand the student’s rights and obligations as 

11 a Federal student loan borrower. 

12 ‘‘(3) LOAN ACCEPTANCE.—Prior to making the 

13 first disbursement of a covered loan (other than a 

14 Federal Direct Consolidation Loan) to a borrower, 

15 the eligible institution shall ensure that the bor16 rower— 

17 ‘‘(A) has completed the applicable coun18 seling under paragraph (2) or (3) of section 

19 485(l); and 

20 ‘‘(B) after completing such counseling, ac21 cepts the loan by— 

22 ‘‘(i) signing and returning to the insti23 tution the student loan contract described 

24 in section 455(c)(1) that affirmatively 


pamtmann on DSKBC07HB2PROD with BILLS
66 

•S 3953 IS

1 states that the borrower accepts the loan; 

2 or 

3 ‘‘(ii) electronically signing an elec4 tronic version of such student loan con5 tract, which may be done through the on6 line counseling tool in accordance with sec7 tion 485(n)(1)(B).’’. 

8 (b) CONFORMING AMENDMENT.—Section 487(a)(7) 

9 (20 U.S.C. 1094(a)(7)) is amended by striking ‘‘section 

10 485’’ and inserting ‘‘sections 455(c)(3) and 485’’. 

11 SEC. 402. PRE-LOAN INFORMATION AND COUNSELING RE12 QUIREMENTS. 

13 Section 485(l) (20 U.S.C. 1092(l)) is amended to 

14 read as follows: 

15 ‘‘(l) STUDENT LOAN ENTRANCE COUNSELING.— 

16 ‘‘(1) STUDENT LOAN ENTRANCE COUNSELING

17 REQUIREMENT FOR INSTITUTIONS.— 

18 ‘‘(A) IN GENERAL.—Each eligible institu19 tion shall ensure that, prior to the date of the 

20 disbursement of a loan for a period of enroll21 ment at such institution, each individual for 

22 whom the institution has knowledge that the in23 dividual has accepted, or will accept, 1 or more 

24 student loans under part D (including any such 

25 loans for attendance at another institution from 


pamtmann on DSKBC07HB2PROD with BILLS
67 

•S 3953 IS

1 which the student transferred or in which the 

2 student had previously enrolled, other than a 

3 Federal Direct Consolidation Loan) for such pe4 riod of enrollment, receives comprehensive in5 formation on the terms and conditions of such 

6 loans and the responsibilities the individual has 

7 with respect to such loans. Such information 

8 shall be provided in a simple, understandable, 

9 and consumer-friendly manner during a coun10 seling session conducted— 

11 ‘‘(i) in person; 

12 ‘‘(ii) online, with the individual ac13 knowledging receipt of the information; or 

14 ‘‘(iii) through the use of the online 

15 counseling tool described in subsection 

16 (n)(1)(B). 

17 ‘‘(B) USE OF INTERACTIVE PROGRAMS.— 

18 In the case of institutions not using the online 

19 counseling tool described in subsection 

20 (n)(1)(B), the Secretary shall require such in21 stitutions to carry out the requirements of sub22 paragraph (A) through the use of interactive 

23 programs, during a counseling session that is 

24 in-person or online, that test the individual’s 

25 understanding of the terms and conditions of 


pamtmann on DSKBC07HB2PROD with BILLS
68 

•S 3953 IS

1 the loan awarded to the individual, using simple 

2 and understandable language and clear for3 matting. 

4 ‘‘(2) LOAN COUNSELING FOR BORROWERS RE5 CEIVING LOANS MADE UNDER PART D (OTHER THAN

6 PARENT PLUS LOANS).—The information to be pro7 vided under paragraph (1)(A) to a borrower of a 

8 loan made under part D (other than a Federal Di9 rect PLUS Loan made on behalf of a dependent stu10 dent) shall include the following: 

11 ‘‘(A) A notification that some students 

12 may qualify for other financial aid that does not 

13 need to be repaid, and an explanation that the 

14 borrower should consider accepting any such 

15 grant, scholarship, military tuition assistance, 

16 veterans benefits, Federal or State work-study, 

17 or other programs for which the borrower is eli18 gible, prior to accepting student loans. 

19 ‘‘(B) An explanation of the use of the stu20 dent loan contract referred to in section 455(c). 

21 ‘‘(C) A recommendation to the borrower to 

22 exhaust the borrower’s Federal student loan op23 tions prior to taking out private education 

24 loans, an explanation that Federal student 

25 loans typically offer better terms and conditions 


pamtmann on DSKBC07HB2PROD with BILLS
69 

•S 3953 IS

1 than private education loans, an explanation 

2 that Federal student loans offer consumer pro3 tections typically not available in the private 

4 education loan market, an explanation of treat5 ment of loans made under part D and private 

6 education loans in bankruptcy, and an expla7 nation that if a borrower decides to take out a 

8 private education loan— 

9 ‘‘(i) the borrower has the ability to se10 lect a private educational lender of the bor11 rower’s choice; 

12 ‘‘(ii) the proposed private education 

13 loan may impact the borrower’s potential 

14 eligibility for other financial assistance, in15 cluding Federal financial assistance under 

16 this title; and 

17 ‘‘(iii) the borrower has a right— 

18 ‘‘(I) to accept the terms of the 

19 private education loan within 30 cal20 endar days following the date on 

21 which the application for such loan is 

22 approved and the borrower receives 

23 the required disclosure documents, 

24 pursuant to section 128(e) of the 


pamtmann on DSKBC07HB2PROD with BILLS
70 

•S 3953 IS

1 Truth in Lending Act (15 U.S.C. 

2 1638(e)); and 

3 ‘‘(II) to cancel such loan within 3 

4 business days of the date on which the 

5 loan is consummated, pursuant to sec6 tion 128(e)(7) of such Act (15 U.S.C. 

7 1638(e)(7)). 

8 ‘‘(D) An explanation of the importance of 

9 contacting the appropriate offices at the institu10 tion of higher education if the student with11 draws prior to completing a program of study 

12 so that the institution can provide exit coun13 seling, including information regarding the bor14 rower’s repayment options and loan consolida15 tion. 

16 ‘‘(E) A general description of the terms 

17 and conditions under which the student may ob18 tain forgiveness or cancellation of any principal 

19 and interest of a loan issued under this title. 

20 ‘‘(F) Information as to how the borrower 

21 can access their loan records and the contact 

22 information for inquiries regarding repaying the 

23 loan. 

24 ‘‘(G) The contact information for the fi25 nancial aid office, or other appropriate office, at 


pamtmann on DSKBC07HB2PROD with BILLS
71 

•S 3953 IS

1 the institution that the borrower may contact if 

2 the borrower has any questions about the bor3 rower’s rights and responsibilities or the terms 

4 and conditions of the loan. 

5 ‘‘(H) An explanation that the borrower has 

6 the right to annually request a copy of the cred7 it report of the borrower from a consumer re8 porting agency pursuant to section 612(a) of 

9 the Fair Credit Reporting Act (15 U.S.C. 

10 1681j(a)). 

11 ‘‘(I) An explanation that— 

12 ‘‘(i) the borrower may be contacted 

13 during the repayment period by a third14 party student debt relief company; 

15 ‘‘(ii) the borrower should use caution 

16 when dealing with such a company; and 

17 ‘‘(iii) the services that such a com18 pany typically provides are offered to bor19 rowers free of charge through the Depart20 ment or the borrower’s servicer. 

21 ‘‘(3) BORROWERS RECEIVING PARENT PLUS

22 LOANS FOR DEPENDENT STUDENTS.—The informa23 tion to be provided under paragraph (1)(A) to a bor24 rower of a Federal Direct PLUS Loan made on beVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00071 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
72 

•S 3953 IS

1 half of a dependent student shall include the fol2 lowing: 

3 ‘‘(A) A notification that some students 

4 may qualify for other financial aid and an ex5 planation that the student for whom the bor6 rower is taking out the loan should consider ac7 cepting any such grant, scholarship, military 

8 tuition assistance, veterans benefits, Federal or 

9 State work-study jobs, or other programs for 

10 which the student for whom the borrower is 

11 taking out the loan is eligible, prior to bor12 rowing any Federal Direct PLUS Loan on be13 half of a dependent student. 

14 ‘‘(B) The information described in sub15 paragraphs (B) through (I) of paragraph (2), 

16 as applicable. 

17 ‘‘(C) The circumstances under which a 

18 borrower of a Federal Direct PLUS Loan made 

19 on behalf of a dependent student may transfer 

20 such loan to the student for whom the loan was 

21 taken out.’’. 

22 SEC. 403. EXIT COUNSELING. 

23 Section 485(b) (20 U.S.C. 1092(b)) is amended to 

24 read as follows: 

25 ‘‘(b) STUDENT LOAN EXIT COUNSELING.— 


pamtmann on DSKBC07HB2PROD with BILLS
73 

•S 3953 IS

1 ‘‘(1) IN GENERAL.— 

2 ‘‘(A) COUNSELING INCLUDED.—Each eligi3 ble institution shall provide counseling to bor4 rowers of loans made under part D (including 

5 any such loans for attendance at another insti6 tution from which the student transferred or in 

7 which the student had previously enrolled, other 

8 than a Federal Direct Consolidation Loan) 

9 prior to the completion of the course of study 

10 for which the borrower enrolled at the institu11 tion or at the time of departure from such insti12 tution. The counseling required by this sub13 section shall be provided through the use of an 

14 interactive program, during an exit counseling 

15 session that is in-person or online, or through 

16 the use of the online counseling tool described 

17 in subsection (n)(1)(A), and shall include— 

18 ‘‘(i) an explanation of the grace period 

19 preceding repayment and the expected date 

20 that the borrower will enter repayment; 

21 ‘‘(ii) an explanation that the borrower 

22 has the option to pay any interest that has 

23 accrued while the borrower was in school 

24 or that may accrue during the grace period 


pamtmann on DSKBC07HB2PROD with BILLS
74 

•S 3953 IS

1 preceding repayment or during an author2 ized period of pause payment; 

3 ‘‘(iii) the outstanding balance of prin4 cipal and interest owed by the borrower at 

5 the time of such counseling on loans made, 

6 insured, or guaranteed to the borrower 

7 under this title; 

8 ‘‘(iv) information on the repayment 

9 plans available, including a description of 

10 the different features of each plan and 

11 sample information showing the average 

12 anticipated monthly payments, and the dif13 ference in interest paid and total pay14 ments, under each plan; 

15 ‘‘(v) a description of the borrower’s 

16 options for pause payment under section 

17 460B; 

18 ‘‘(vi) a description of the Federal tax 

19 benefits that may be available for repaying 

20 loans made under this title; 

21 ‘‘(vii) a description of the terms and 

22 conditions under which the student may 

23 obtain forgiveness or cancellation of any 

24 principal and interest of a loan made 

25 under this title; 


pamtmann on DSKBC07HB2PROD with BILLS
75 

•S 3953 IS

1 ‘‘(viii) an explanation that the bor2 rower has the option to prepay each loan, 

3 pay each loan on a shorter schedule, and 

4 change repayment plans; 

5 ‘‘(ix) the implications of, and options 

6 to get out of, default on a loan; 

7 ‘‘(x) information as to how the stu8 dent borrower can access their loan 

9 records; 

10 ‘‘(xi) an explanation that— 

11 ‘‘(I) the borrower may be con12 tacted during the repayment period by 

13 a third-party student debt relief com14 pany; 

15 ‘‘(II) the borrower should use 

16 caution when dealing with such a 

17 company; and 

18 ‘‘(III) the services that such a 

19 company typically provides are offered 

20 to borrowers free of charge through 

21 the Department or the borrower’s 

22 servicer; and 

23 ‘‘(xii) an explanation that the bor24 rower has the right to annually request a 

25 copy of the credit report of the borrower 


pamtmann on DSKBC07HB2PROD with BILLS
76 

•S 3953 IS

1 from a consumer reporting agency pursu2 ant to section 612(a) of the Fair Credit 

3 Reporting Act (15 U.S.C. 1681j(a)). 

4 ‘‘(B) STUDENTS LEAVING WITHOUT PRIOR

5 NOTICE TO THE INSTITUTION.—In the case of 

6 borrower who leaves an institution without the 

7 prior knowledge of the institution, the institu8 tion shall attempt to provide the information 

9 described in subparagraph (A) to the borrower 

10 in online or in writing, except that in the case 

11 of an institution using the online counseling 

12 tool described in subsection (n)(1)(A), the Sec13 retary shall attempt to provide such information 

14 to the borrower in the manner described in sub15 section (n)(3)(C). 

16 ‘‘(2) INFORMATION TO BE SUBMITTED BY BOR17 ROWER.— 

18 ‘‘(A) IN GENERAL.—Each eligible institu19 tion shall require that the borrower of a loan 

20 made under part D submit to the institution, 

21 during the exit counseling required by this sub22 section— 

23 ‘‘(i) the borrower’s expected perma24 nent address after leaving the institution; 


pamtmann on DSKBC07HB2PROD with BILLS
77 

•S 3953 IS

1 ‘‘(ii) the borrower’s most recent con2 tact information; and 

3 ‘‘(iii) any corrections in the institu4 tion’s records relating the borrower’s 

5 name, social security number, and driver’s 

6 license number, as applicable. 

7 ‘‘(B) INFORMATION TO BE PROVIDED TO

8 THE SECRETARY.—Each eligible institution 

9 shall, not later than 60 days after the date of 

10 collection of the information described in sub11 paragraph (A), forward the information re12 ceived from the borrower to the Secretary. 

13 ‘‘(C) RULE OF CONSTRUCTION.—Nothing 

14 in this subsection shall be construed to prohibit 

15 an institution of higher education from utilizing 

16 electronic means to provide personalized exit 

17 counseling.’’. 

18 SEC. 404. ONLINE COUNSELING TOOLS. 

19 Section 485 (20 U.S.C. 1092), as amended by this 

20 Act, is further amended by adding at the end the fol21 lowing: 

22 ‘‘(n) ONLINE COUNSELING TOOLS.— 

23 ‘‘(1) IN GENERAL.—Beginning not later than 1 

24 year after the date of enactment of the Affordable 


pamtmann on DSKBC07HB2PROD with BILLS
78 

•S 3953 IS

1 Loans for Any Student Act, the Secretary shall 

2 maintain— 

3 ‘‘(A) an online counseling tool that pro4 vides the exit counseling required under sub5 section (b) and meets the applicable require6 ments of this subsection; and 

7 ‘‘(B) an online counseling tool that pro8 vides the counseling required under subsection 

9 (l), enables a borrower to electronically sign and 

10 accept the borrower’s student loan contract, 

11 and meets the applicable requirements of this 

12 subsection. 

13 ‘‘(2) REQUIREMENTS OF TOOLS.—In maintain14 ing the online counseling tools described in para15 graph (1), the Secretary shall ensure that each such 

16 tool, and its underlying content— 

17 ‘‘(A) are consumer tested, in consultation 

18 with other relevant Federal agencies, students, 

19 borrowers, institutions of higher education, sec20 ondary school and postsecondary counselors, 

21 and consumer advocacy organizations, to ensure 

22 that the tool is effective in helping individuals 

23 understand their rights and obligations with re24 spect to borrowing a loan made under part D; 


pamtmann on DSKBC07HB2PROD with BILLS
79 

•S 3953 IS

1 ‘‘(B) are understandable to borrowers of 

2 loans made under part D; 

3 ‘‘(C) are freely available to all eligible in4 stitutions; and 

5 ‘‘(D) integrate applicable loan data from 

6 the National Student Loan Data System or a 

7 successor system, including data regarding 

8 loans made, insured, or guaranteed under this 

9 title and data regarding private education 

10 loans, pursuant to section 485B(i). 

11 ‘‘(3) RECORD OF COUNSELING COMPLETION.— 

12 The Secretary shall— 

13 ‘‘(A) use each online counseling tool de14 scribed in paragraph (1) to— 

15 ‘‘(i) keep a record of which individuals 

16 have received counseling using the tool; 

17 and 

18 ‘‘(ii) notify the applicable institutions 

19 of the individual’s completion of such coun20 seling; 

21 ‘‘(B) in the case of a borrower who re22 ceives counseling for a loan made under part D 

23 using the tool described in paragraph (1)(B)— 

24 ‘‘(i) enable the borrower to accept and 

25 electronically sign the student loan conVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00079 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
80 

•S 3953 IS

1 tract as required under section 

2 455(c)(3)(B)(ii), and notify the applicable 

3 institutions that the individual completed 

4 the counseling and electronically signed the 

5 contract; and 

6 ‘‘(ii) if the borrower chooses not to 

7 sign the student loan contract through the 

8 online counseling tool— 

9 ‘‘(I) inform the borrower, 

10 through the online counseling tool, of 

11 the date by when the borrower should 

12 accept and sign the student loan con13 tract for which the borrower has re14 ceived such counseling; and 

15 ‘‘(II) notify the applicable insti16 tution that the borrower completed 

17 the counseling but did not sign the 

18 student loan contract; and 

19 ‘‘(C) in the case of a borrower described in 

20 subsection (b)(1)(B) at an institution that uses 

21 the online counseling tool described in para22 graph (1)(A) of this subsection, attempt to pro23 vide the information described in subsection 

24 (b)(1)(A) to the borrower through such tool.’’. 


pamtmann on DSKBC07HB2PROD with BILLS
81 

•S 3953 IS

1 SEC. 405. PRIVATE EDUCATION LOAN CERTIFICATION AND 

2 INFORMATION. 

3 (a) AMENDMENTS TO THE HIGHER EDUCATION ACT

4 OF 1965.— 

5 (1) IN GENERAL.—Section 487(a) (20 U.S.C. 

6 1094(a)) is amended by striking paragraph (28) and 

7 inserting the following: 

8 ‘‘(28)(A) The institution shall— 

9 ‘‘(i) upon the request of a private edu10 cational lender, acting in connection with an ap11 plication initiated by a borrower for a private 

12 education loan in accordance with section 

13 128(e)(3) of the Truth in Lending Act, provide 

14 certification to such private educational lend15 er— 

16 ‘‘(I) that the student who initiated the 

17 application for the private education loan, 

18 or on whose behalf the application was ini19 tiated, is enrolled or is scheduled to enroll 

20 at the institution; 

21 ‘‘(II) of such student’s cost of attend22 ance at the institution as determined under 

23 part F; and 

24 ‘‘(III) of the difference between— 

25 ‘‘(aa) the cost of attendance at 

26 the institution; and 


pamtmann on DSKBC07HB2PROD with BILLS
82 

•S 3953 IS

1 ‘‘(bb) the student’s estimated fi2 nancial assistance received under this 

3 title and other assistance known to 

4 the institution, as applicable; and 

5 ‘‘(ii) provide the certification described in 

6 clause (i), or notify the private educational 

7 lender that the institution has received the re8 quest for certification and will need additional 

9 time to comply with the certification request— 

10 ‘‘(I) within 15 business days of receipt 

11 of such certification request; and 

12 ‘‘(II) only after the institution has 

13 completed the activities described in sub14 paragraph (B). 

15 ‘‘(B) The institution shall, upon receipt of a 

16 certification request described in subparagraph 

17 (A)(i), and prior to providing such certification— 

18 ‘‘(i) determine whether the student who 

19 initiated the application for the private edu20 cation loan, or on whose behalf the application 

21 was initiated, has applied for and exhausted the 

22 Federal financial assistance available to such 

23 student under this title and inform the student 

24 accordingly; and 


pamtmann on DSKBC07HB2PROD with BILLS
83 

•S 3953 IS

1 ‘‘(ii) provide the borrower whose loan ap2 plication has prompted the certification request 

3 by a private education lender, as described in 

4 subparagraph (A)(i), with the following infor5 mation and disclosures: 

6 ‘‘(I) If the borrower has not yet ex7 hausted the financial assistance available 

8 to the borrower under this title, the 

9 amount of additional Federal student as10 sistance for which the borrower is eligible 

11 and the potential advantages of Federal 

12 loans under this title, including disclosure 

13 of— 

14 ‘‘(aa) the fixed interest rates and 

15 pause payment processes; 

16 ‘‘(bb) the option for and terms of 

17 income-based repayment, loan forgive18 ness programs, and additional protec19 tions; and 

20 ‘‘(cc) the higher student loan lim21 its for dependent students whose par22 ents are not eligible for a Federal Di23 rect PLUS Loan. 


pamtmann on DSKBC07HB2PROD with BILLS
84 

•S 3953 IS

1 ‘‘(II) The borrower’s ability to select a 

2 private educational lender of the bor3 rower’s choice. 

4 ‘‘(III) The impact of a proposed pri5 vate education loan on the borrower’s po6 tential eligibility for other financial assist7 ance, including Federal financial assistance 

8 under this title. 

9 ‘‘(IV) The borrower’s right to accept 

10 or reject a private education loan within 

11 the 30-day period following a private edu12 cational lender’s approval of a borrower’s 

13 application, and a borrower’s 3-day right 

14 to cancel period under section 128(e)(7) of 

15 the Truth in Lending Act (15 U.S.C. 

16 1650(e)(7)). 

17 ‘‘(C) For purposes of this paragraph, the terms 

18 ‘private educational lender’ and ‘private education 

19 loan’ have the meanings given such terms in section 

20 140 of the Truth in Lending Act (15 U.S.C. 

21 1650).’’. 

22 (2) NATIONAL STUDENT LOAN DATA SYSTEM.— 

23 Section 485B (20 U.S.C. 1092b) is amended— 

24 (A) in subsection (a), by striking ‘‘and 

25 loans made under parts D and E’’ and insertVerDate Sep 11 2014 18:32 Apr 04, 2022 Jkt 029200 PO 00000 Frm 00084 Fmt 6652 Sfmt 6201 E:\BILLS\S3953.IS S3953

pamtmann on DSKBC07HB2PROD with BILLS
85 

•S 3953 IS

1 ing ‘‘, loans made under parts D and E, and 

2 private education loans (in accordance with sub3 section (i))’’; 

4 (B) in subsection (g), in the subsection 

5 heading, by inserting ‘‘FOR FEDERAL LOANS’’ 

6 after ‘‘DATA REPORTING’’; and 

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

8 ‘‘(j) PRIVATE EDUCATION LOAN REPORTING.—The 

9 Secretary shall include in the National Student Loan Data 

10 System the information regarding private education loans 

11 that the Director of the Consumer Financial Protection 

12 Bureau, in coordination with the Secretary, determines 

13 necessary to be included pursuant to section 

14 128(e)(9)(B)(ii) of the Truth in Lending Act (15 U.S.C. 

15 1638(e)(9)(B)(ii)).’’. 

16 (3) EFFECTIVE DATE.—The amendments made 

17 by paragraphs (1) and (2) shall take effect on the 

18 effective date of the regulations described in sub19 section (b)(3). 

20 (b) AMENDMENTS TO THE TRUTH IN LENDING

21 ACT.— 

22 (1) IN GENERAL.—Section 128(e) of the Truth 

23 in Lending Act (15 U.S.C. 1638(e)) is amended— 

24 (A) by striking paragraph (3) and insert25 ing the following: 


pamtmann on DSKBC07HB2PROD with BILLS
86 

•S 3953 IS

1 ‘‘(3) INSTITUTIONAL CERTIFICATION RE2 QUIRED.— 

3 ‘‘(A) IN GENERAL.—Except as provided in 

4 subparagraph (B), before a private educational 

5 lender may issue any funds with respect to a 

6 private education loan, the private educational 

7 lender shall obtain, from the relevant institution 

8 of higher education where such loan is to be 

9 used for a student, a certification in accordance 

10 with section 485(a)(28)(A) of the Higher Edu11 cation Act of 1965 (20 U.S.C. 

12 1094(a)(28)(A))— 

13 ‘‘(i) confirming that the student is en14 rolled or is scheduled to be enrolled at the 

15 institution; and 

16 ‘‘(ii) stating— 

17 ‘‘(I) the student’s cost of attend18 ance at the institution, as determined 

19 by the institution under part F of title 

20 IV of the Higher Education Act of 

21 1965 (20 U.S.C. 1087kk et seq.); and 

22 ‘‘(II) the difference between— 

23 ‘‘(aa) such cost of attend24 ance; and 


pamtmann on DSKBC07HB2PROD with BILLS
87 

•S 3953 IS

1 ‘‘(bb) the student’s esti2 mated financial assistance, in3 cluding such assistance received 

4 under title IV of the Higher Edu5 cation Act of 1965 (20 U.S.C. 

6 1070 et seq.) and other financial 

7 assistance known to the institu8 tion, as applicable. 

9 ‘‘(B) TIMING.—Pursuant to section 

10 485(a)(28)(A) of the Higher Education Act of 

11 1965 (20 U.S.C. 1094(a)(28)(A)), a private 

12 education lender shall receive the certification 

13 described in subparagraph (A) within 15 days 

14 of a request by the private education lender, 

15 unless the institution of higher education noti16 fies the private educational lender pursuant to 

17 section 485(a)(28)(A)(ii) of such Act that addi18 tional time is needed. 

19 ‘‘(C) ADDITIONAL REQUIREMENTS.—Upon 

20 receiving the certification described in subpara21 graph (A) for a private education loan, the pri22 vate educational lender— 

23 ‘‘(i) may proceed to issue funds with 

24 respect to the private education loan; and 


pamtmann on DSKBC07HB2PROD with BILLS
88 

•S 3953 IS

1 ‘‘(ii) after issuing the private edu2 cation loan, shall— 

3 ‘‘(I) notify the institution of 

4 higher education involved that the pri5 vate education loan has been issued to 

6 the borrower, and the amount of such 

7 loan; and 

8 ‘‘(II) provide the Director of the 

9 Consumer Financial Protection Bu10 reau and the Secretary of Education 

11 with the information described in 

12 paragraph (9)(B).’’; 

13 (B) by redesignating paragraphs (9), (10), 

14 and (11), as paragraphs (10), (11), and (12), 

15 respectively; and 

16 (C) by inserting after paragraph (8) the 

17 following: 

18 ‘‘(9) PROVISION OF INFORMATION.— 

19 ‘‘(A) PROVISION OF INFORMATION TO BOR20 ROWERS.— 

21 ‘‘(i) LOAN STATEMENTS.—A private 

22 educational lender that issues any funds 

23 with respect to a private education loan 

24 shall— 


pamtmann on DSKBC07HB2PROD with BILLS
89 

•S 3953 IS

1 ‘‘(I) send loan statements, if the 

2 loan is to be used for a student, to 

3 borrowers of the funds not less than 

4 once every 3 months during the time 

5 that the student is enrolled at an in6 stitution of higher education; and 

7 ‘‘(II) in the case of a private edu8 cation loan that includes a cosigner, 

9 annually send a loan statement to the 

10 borrower’s cosigner, notifying the co11 signer of the terms, conditions, and 

12 status of such private education loan. 

13 ‘‘(ii) CONTENTS OF LOAN STATE14 MENT.—Each statement described in 

15 clause (i) shall— 

16 ‘‘(I) report the borrower’s total 

17 remaining debt to the private edu18 cational lender, including accrued but 

19 unpaid interest and capitalized inter20 est; 

21 ‘‘(II) report any debt increases 

22 since the last statement; and 

23 ‘‘(III) list the current interest 

24 rate for each loan. 


pamtmann on DSKBC07HB2PROD with BILLS
90 

•S 3953 IS

1 ‘‘(B) PROVISION OF INFORMATION TO

2 FEDERAL AGENCIES.— 

3 ‘‘(i) INFORMATION FROM LENDER.— 

4 Each private educational lender shall— 

5 ‘‘(I) submit to the Director of the 

6 Consumer Financial Protection Bu7 reau and the Secretary of Education 

8 such information regarding a private 

9 education loan as may be determined 

10 necessary by the Director and the 

11 Secretary under clause (ii) for inclu12 sion in the National Student Loan 

13 Data System under section 485B(i) of 

14 the Higher Education Act of 1965 (20 

15 U.S.C. 1092b(i)); and 

16 ‘‘(II) prepare and submit an an17 nual report to the Consumer Finan18 cial Protection Bureau regarding the 

19 private education loans issued by the 

20 private educational lender. 

21 ‘‘(ii) PROMULGATION OF REGULA22 TIONS.—Not later than 1 year after the 

23 date of enactment of the Affordable Loans 

24 for Any Student Act, the Director of the 

25 Consumer Financial Protection Bureau, in 


pamtmann on DSKBC07HB2PROD with BILLS
91 

•S 3953 IS

1 coordination with the Secretary of Edu2 cation, shall promulgate regulations re3 garding the private education loan infor4 mation required to be submitted under 

5 clause (i), including the content, method, 

6 and format for submission. The informa7 tion required for inclusion in the National 

8 Student Loan Data System shall include— 

9 ‘‘(I) information identifying the 

10 borrower, including the borrower’s 

11 name and social security number; 

12 ‘‘(II) the name of the institution 

13 of higher education that has certified 

14 the private education loan; 

15 ‘‘(III) the name of the lender; 

16 ‘‘(IV) the amount of the private 

17 education loan; 

18 ‘‘(V) the term, or other enroll19 ment period, for which the private 

20 education loan is issued; and 

21 ‘‘(VI) whether a cosigner was re22 quired as a condition of the private 

23 education loan.’’. 


pamtmann on DSKBC07HB2PROD with BILLS
92 

•S 3953 IS

1 (2) DEFINITION OF PRIVATE EDUCATION

2 LOAN.—Section 140(a)(8)(A) of the Truth in Lend3 ing Act (15 U.S.C. 1650(a)(8)(A)) is amended— 

4 (A) by redesignating clause (ii) as clause 

5 (iii); 

6 (B) in clause (i), by striking ‘‘and’’ after 

7 the semicolon; and 

8 (C) by adding after clause (i) the following: 

9 ‘‘(ii) is not made, insured, or guaran10 teed under title VII or title VIII of the 

11 Public Health Service Act (42 U.S.C. 292 

12 et seq. and 296 et seq.); and’’. 

13 (3) REGULATIONS.— 

14 (A) IN GENERAL.—Not later than 1 year 

15 after the date of enactment of this Act, the Di16 rector of the Consumer Financial Protection 

17 Bureau, in coordination with the Secretary of 

18 Education, shall promulgate regulations to im19 plement paragraphs (3) and (9) of section 

20 128(e) of the Truth in Lending Act (15 U.S.C. 

21 1638(e)), as amended by paragraph (1) of this 

22 subsection. 

23 (B) EFFECTIVE DATE.—The regulations 

24 promulgated under subparagraph (A) shall take 


pamtmann on DSKBC07HB2PROD with BILLS
93 

•S 3953 IS

1 effect on the date that is 180 days after the 

2 date on which the regulations are promulgated. 

3 TITLE V—EFFECTIVE DATE; 

4 TRANSITION; IMPLEMENTATION 

5 SEC. 501. EFFECTIVE DATE; RULEMAKING REGARDING TER6 MINATION OF CERTAIN REPAYMENT PLANS; 

7 IMPLEMENTATION. 

8 (a) EFFECTIVE DATE.—Except as otherwise specifi9 cally provided, this Act, and the amendments made by this 

10 Act, shall take effect on July 1, 2022. 

11 (b) APPLICABILITY WITH RESPECT TO FORBEAR12 ANCE AND DEFERMENT FOR DIRECT LOAN BOR13 ROWERS.—With respect to any borrower of a loan under 

14 part D of title IV of the Higher Education Act of 1965 

15 (20 U.S.C. 1087a et seq.) that is, or has been, in forbear16 ance or deferment as of the day before the effective date 

17 described in subsection (a), the Secretary shall take such 

18 steps as are necessary— 

19 (1) to transfer a borrower with a loan in for20 bearance or deferment as of such day automatically 

21 into relief provided under the pause payment process 

22 established under section 460B of such Act (as 

23 amended by this Act); and 

24 (2) to ensure that the period of time for which 

25 a borrower is eligible for pause payment under such 


pamtmann on DSKBC07HB2PROD with BILLS
94 

•S 3953 IS

1 section 460B for a loan is appropriately reduced to 

2 account for any time the loan was previously in for3 bearance or deferment. 

4 (c) REGULATIONS.—Before the effective date de5 scribed in subsection (a), the Secretary of Education shall 

6 carry out a plan to end all eligibility for repayment plans 

7 other than a fixed repayment plan described in section 

8 493E of the Higher Education Act of 1965, as added by 

9 this Act, and an income-based repayment plan under sec10 tion 493C(c) of such Act (20 U.S.C. 1098e(f)) for loans 

11 made under part B or D of title IV of such Act, unless 

12 the borrower is enrolled in another repayment plan before 

13 such effective date, in accordance with the amendments 

14 made by this Act. 

15 (d) IMPLEMENTATION.—In carrying out the amend16 ments made by this Act, or any regulations promulgated 

17 under this Act, the Secretary of Education may waive the 

18 application of— 

19 (1) subchapter I of chapter 35 of title 44, 

20 United States Code (commonly known as the ‘‘Pa21 perwork Reduction Act’’); 

22 (2) the master calendar requirements under 

23 section 482 of the Higher Education Act of 1965 

24 (20 U.S.C. 1089); 


pamtmann on DSKBC07HB2PROD with BILLS
95 

•S 3953 IS

1 (3) negotiated rulemaking under section 492 of 

2 the Higher Education Act of 1965 (20 U.S.C. 

3 1098a); and 

4 (4) the requirement to publish the notices re5 lated to the system of records of the agency before 

6 implementation required under paragraphs (4) and 

7 (11) of section 552a(e) of title 5, United States 

8 Code (commonly known as the ‘‘Privacy Act of 

9 1974’’). 

Æ 


pamtmann on DSKBC07HB2PROD with BILLS