quirements under paragraph (1) for such cancellation, 
such cancellation shall occur without further action by the 
borrower.’’. 
(c) TREATMENT OF REFINANCED LOANS; ON-LINE 
PORTAL; DATABASE OF PUBLIC SERVICE JOBS.—Section 
455(m) of such Act (20 U.S.C. 1087e(m)) is further 
amended— 
(1) by redesignating paragraphs (3) and (4) as 
paragraphs (6) and (7), respectively; and 
(2) by inserting after paragraph (2) the fol-
lowing: 
‘‘(3) TREATMENT
OF
LOANS
REFINANCED 
UNDER SECTIONS 460A.—In the case of an eligible 
refinanced Federal Direct Loan under section 460A, 
any monthly payment pursuant to any repayment 
plan listed in paragraph (1)(A) (including a period 
of deferment or forbearance described in paragraph 
(1)(A)(v)) made on a loan, for which the liability has 
been discharged by such refinanced loan and without 
regard to whether such loan is an eligible Federal 
Direct Loan, shall be treated as a monthly payment 
under paragraph (1)(A) on the portion of such refi-
nanced loan that is attributable to such discharged 
loan. 
‘‘(4) ON-LINE PORTAL.— 
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‘‘(A) BORROWERS.—The Secretary shall 
ensure that borrowers have access to an on-line 
portal that provides each borrower who signs on 
to such portal with the following: 
‘‘(i) Instructions on how to access the 
database under paragraph (5) so that the 
borrower can determine whether the bor-
rower is employed in a public service job. 
‘‘(ii) An identification of the loans of 
the borrower that are eligible Federal Di-
rect Loans. 
‘‘(iii) With respect to each such eligi-
ble Federal Direct Loan, the number of 
monthly payments on such loan that qual-
ify as a monthly payment under paragraph 
(1)(A), and the estimated number of 
monthly payments under paragraph (1)(A) 
remaining on such loan before the bor-
rower may be eligible for loan cancellation 
under this subsection. 
‘‘(iv) With respect to each loan of the 
borrower that is not eligible for loan can-
cellation under this subsection, an expla-
nation of why the loan is not so eligible 
and instructions on how what, if anything, 
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the borrower may do to make the loan so 
eligible. 
‘‘(v) Instructions for the submission of 
any forms associated with such loan can-
cellation, and an ability for the borrower to 
use the portal to electronically sign and 
submit such forms. 
‘‘(vi) In the case of a borrower who 
disputes a determination of the Secretary 
relating to the entitlement of the borrower 
to loan cancellation under paragraph (2)— 
‘‘(I) an ability for the borrower 
to file a claim with the Secretary to 
dispute such determination through 
the portal; and 
‘‘(II) in the case of such a claim 
that has been filed, the status of such 
claim, for which updates shall be pro-
vided not fewer than once every 90 
days. 
‘‘(B) EMPLOYERS.—The Secretary shall 
ensure that an employer of a borrower has the 
option to electronically sign and submit any 
forms associated with loan cancellation under 
this subsection. 
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‘‘(C) INFORMATION.—The Secretary shall 
ensure that any information provided through 
the on-line portal described in this paragraph is 
up-to-date information. 
‘‘(5) DATABASE OF PUBLIC SERVICE JOBS.— 
‘‘(A) IN GENERAL.—The Secretary, in con-
sultation with the Secretary of Labor, shall es-
tablish and regularly update a database that 
lists public service jobs. 
‘‘(B) PUBLIC
AVAILABILITY.—The data-
base established under subparagraph (A) shall 
be made available on a publicly accessible 
website of the Department in an easily search-
able format.’’. 
(d) DEFINITIONS.—Section 455(m) of such Act is 
further amended in paragraph (6)(A) (as so redesignated 
by subsection (c))— 
(1) by inserting before the period at the end the 
following: ‘‘(including any Federal Direct Stafford 
Loan, Federal Direct PLUS Loan, Federal Direct 
Unsubsidized Stafford Loan, or Federal Direct Con-
solidation Loan refinanced under section 460A)’’; 
(2) by striking ‘‘The term’’ and inserting the 
following: 
‘‘(i) IN GENERAL.—The term’’; and 
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(3) by adding at the end the following: 
‘‘(ii) TREATMENT OF CERTAIN CON-
SOLIDATION
LOAN
PAYMENTS.—In the 
case of an eligible Federal Direct Loan 
that is a Federal Direct Consolidation 
Loan made on or after the date of enact-
ment of the LOAN Act, any monthly pay-
ment pursuant to any repayment plan list-
ed in paragraph (1)(A) (including a period 
of deferment or forbearance described in 
paragraph (1)(A)(v)) made on a loan, for 
which the liability has been discharged by 
the proceeds of such Federal Direct Con-
solidation Loan and without regard to 
whether the loan is an eligible Federal Di-
rect Loan, shall be treated as a monthly 
payment under paragraph (1)(A) on the 
portion of such Federal Direct Consolida-
tion Loan that is attributable to such dis-
charged loan, except that in a case of a 
borrower who previously received a Federal 
Direct Consolidation Loan, any monthly 
payment made on a loan for which the li-
ability has been discharged by such pre-
vious consolidation loan shall not be treat-
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ed as a monthly payment on a portion of 
the subsequent Federal Direct Consolida-
tion Loan made on or after such date of 
enactment.’’. 
(e) TREATMENT
OF DOUBLE BENEFITS.—Section 
455(m) of such Act is further amended in paragraph (7) 
(as so redesignated by subsection (c)) by striking ‘‘both 
this subsection and section 428J, 428K, 428L, or 460’’ 
and inserting ‘‘both this subsection and section 428K or 
428L’’. 
SEC. 222. LOAN FORGIVENESS FOR TEACHERS. 
The Higher Education Act of 1965 (20 U.S.C. 1001 
et seq.) is further amended— 
(1) in section 428J(g)(2) (20 U.S.C. 1078– 
10(g)(2))— 
(A) in subparagraph (A), by inserting ‘‘or’’ 
after the semicolon at the end; 
(B) by striking subparagraph (B); and 
(C) by redesignating subparagraph (C) as 
subparagraph (B); and 
(2) 
in 
section 
460(g)(2) 
(20 
U.S.C. 
1087j(g)(2))— 
(A) in subparagraph (A), by inserting ‘‘or’’ 
after the semicolon at the end; 
(B) by striking subparagraph (B); and 
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(C) by redesignating subparagraph (C) as 
subparagraph (B). 
TITLE III—INTEREST 
CAPITALIZATION 
SEC. 301. ELIMINATION OF INTEREST CAPITALIZATION. 
(a) FEDERAL PLUS LOANS.—Section 428B(d)(2) of 
the Higher Education Act of 1965 (20 U.S.C. 1078– 
2(d)(2)) is amended to read as follows: 
‘‘(2) NO CAPITALIZATION OF INTEREST.—Inter-
est on loans made under this section for which pay-
ments of principal are deferred pursuant to para-
graph (1) shall be paid by the borrower and shall 
not be capitalized.’’. 
(b) FEDERAL
CONSOLIDATION
LOANS
DEFER-
RALS.—Section 428C(b)(4)(C)(ii)(III) of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1078–3(b)(4)(C)(III)) is 
amended by striking ‘‘or capitalized,’’. 
(c) 
DEFAULT
REDUCTION
PROGRAM.—Section 
428F(a)(1)(E) of such Act of 1965 (20 U.S.C. 1078– 
6(a)(1)(E)) is amended to read as follows: 
‘‘(E) DUTIES
UPON
ASSIGNMENT.—With 
respect to a loan assigned under subparagraph 
(A)(ii)— 
‘‘(i) the guaranty agency shall add to 
the principal and interest outstanding at 
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the time of the assignment of such loan an 
amount equal to the amount described in 
subparagraph (D)(i)(II)(aa); 
‘‘(ii) the Secretary shall pay the guar-
anty agency, for deposit in the agency’s 
Operating Fund established pursuant to 
section 422B, an amount equal to the 
amount added to the principal and interest 
outstanding at the time of the assignment 
in accordance with clause (i); 
‘‘(iii) for a loan assigned on or after 
the date of enactment of the LOAN Act, 
the interest outstanding at the time of the 
assignment of such loan, and any interest 
accruing after such time, shall not be cap-
italized; and 
‘‘(iv) beginning on the date of enact-
ment of LOAN Act, interest shall only ac-
crue on the percentage of such a loan that 
is equal to— 
‘‘(I) the amount of the out-
standing principal on the original loan 
on the date it was assigned; divided 
by 
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‘‘(II) the total amount of such 
assigned loan, including interest out-
standing at the time of the assign-
ment of such loan and the amount 
added by the guaranty agency in ac-
cordance with clause (i), on the date 
such loan was assigned.’’. 
(d) LOAN LIMITS
FOR UNSUBSIDIZED STAFFORD 
LOANS.—Section 428H(d)(5) of the Higher Education 
Act of 1965 (20 U.S.C. 1078–8(d)(5)) is amended by in-
serting ‘‘before the date of enactment of the LOAN Act’’ 
after ‘‘Interest capitalized’’. 
(e) UNSUBSIDIZED STAFFORD LOANS FOR MIDDLE 
INCOME BORROWERS.—Section 428H(e)(2) of the Higher 
Education Act of 1965 (20 U.S.C. 1078–8(e)(2)) is 
amended— 
(1) in the header, by striking ‘‘CAPITALIZA-
TION’’ and inserting ‘‘NO CAPITALIZATION’’; 
(2) in subparagraph (A), in the matter before 
clause (i), by striking ‘‘, if agreed upon by the bor-
rower and the lender’’ and all that follows through 
clause (ii)(IV) and inserting ‘‘be paid by the bor-
rower and shall not be capitalized.’’; 
(3) by striking subparagraph (B); and 
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(4) by redesignating subparagraph (C) as sub-
paragraph (B). 
(f) INCOME
CONTINGENT
REPAYMENT.—Section 
455(e)(5) of the Higher Education Act of 1965 (20 U.S.C. 
1087e(e)(5)) is amended by striking the last sentence and 
inserting ‘‘No interest may be capitalized on such loan on 
or after the date of the enactment of the LOAN Act, and 
the Secretary shall promulgate regulations with respect to 
the treatment of accrued interest that is not capitalized’’. 
(g) DEFERMENT AND FORBEARANCE.— 
(1) IN GENERAL.—Section 455(f) of the Higher 
Education Act of 1965 (20 U.S.C. 1087e(f)) is 
amended— 
(A) in the subsection heading, by inserting 
at the end the following: ‘‘AND FORBEARANCE’’; 
(B) in subparagraph (B), by striking ‘‘cap-
italized or’’; and 
(C) by adding at the end the following: 
‘‘(6) FORBEARANCE.—At the expiration of a 
period of forbearance, interest shall not be capital-
ized on any loans made under this part.’’. 
(2) 
APPLICATION
OF
AMENDMENT.—The 
amendments made by paragraph (1) shall apply to 
any deferment or forbearance period in effect on the 
date of enactment of this Act, or any deferment or 
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forbearance period beginning on or after such date 
of enactment. 
(h) INCOME-BASED REPAYMENT PROGRAM.—Section 
493C(b)(3) of the Higher Education Act of 1965 (20 
U.S.C. 1098e(b)(3)) is amended to read as follows: 
‘‘(3) on subsidized loans, any interest due and 
not paid under paragraph (2) shall be paid by the 
Secretary for a period of not more than 3 years 
after the date of the borrower’s election under para-
graph (1), except that such period shall not include 
any period during which the borrower is in 
deferment due to an economic hardship described in 
section 435(o);’’. 
(i) NOTES AND INSURANCE CERTIFICATES IN COM-
BINED PAYMENT PLANS.—Section 485A(f) of the Higher 
Education Act of 1965 (20 U.S.C. 1092a(f)) is amended 
by adding at the end the following new paragraph: 
‘‘(3) TREATMENT
OF
INTEREST.—Not with-
standing paragraphs (1) and (2), beginning on the 
date of enactment of the LOAN Act, interest on a 
loan reissued under subsection (e) shall not be cap-
italized, and interest shall only accrue on the per-
centage of such reissued loan that is equal to— 
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‘‘(A) the amount of the outstanding prin-
cipal on the original loan on the date it was re-
issued; divided by 
‘‘(B) the total amount of such reissued 
loan on the date such loan was reissued.’’. 
SEC. 302. ELIMINATION OF DISCLOSURE REQUIREMENTS 
RELATING TO CAPITALIZATION. 
(a) INSURANCE PROGRAM AGREEMENTS TO QUAL-
IFY
LOANS
FOR
INTEREST
SUBSIDIES.—Section 
428(b)(1)(Y) of the Higher Education Act of 1965 (20 
U.S.C. 1078(b)(1)(Y)) is amended— 
(1) in clause (i)(IV), by inserting ‘‘and’’ after 
the semicolon; 
(2) in clause (ii), by striking ‘‘; and’’ and in-
serting a period; and 
(3) by striking clause (iii). 
(b) FORBEARANCE.—Section 428(c)(3)(C) of such 
Act of 1965 (20 U.S.C. 1078(c)(3)(C)) is amended— 
(1) in clause (ii), by inserting ‘‘and’’ after the 
semicolon; and 
(2) by striking clauses (iii) and (iv) and insert-
ing the following: 
‘‘(iii) the lender shall contact the bor-
rower not less often than once every 180 
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days during the period of forbearance to 
inform the borrower of— 
‘‘(I) the amount of unpaid prin-
cipal and the amount of interest that 
has accrued since the last statement 
of such amounts provided to the bor-
rower by the lender; 
‘‘(II) the fact that interest will 
accrue on the loan for the period of 
forbearance; 
‘‘(III) the responsibility of the 
borrower to pay the interest that has 
accrued; and 
‘‘(IV) the borrower’s option to 
discontinue the forbearance at any 
time; and’’. 
(c) REQUIRED DISCLOSURE BEFORE DISBURSE-
MENT.—Section 433(a) of the Higher Education Act of 
1965 (20 U.S.C. 1083(a)) is amended— 
(1) by amending paragraph (6) to read as fol-
lows: 
‘‘(6) for loans made under section 428H or to 
a student borrower under section 428B, an expla-
nation that the borrower has the option to pay the 
interest that accrues on the loan while the borrower 
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(f) DISCLOSURE REQUIRED PRIOR TO PERKINS RE-
PAYMENT.—Section 463A(b)(3) of the Higher Education 
Act of 1965 (20 U.S.C. 1087cc–1(b)(3)) is amended by 
striking ‘‘(including, if applicable, the estimated amount 
of interest to be capitalized)’’. 
(g) DEPARTMENTAL
PUBLICATION
OF
DESCRIP-
TIONS OF ASSISTANCE PROGRAMS.—Section 485(d)(1) of 
the Higher Education Act of 1965 (20 U.S.C. 1092(d)(1)) 
is amended by striking ‘‘, including the increase in debt 
that results from capitalization of interest’’. 
(h) INFORMATION TO BE PROVIDED DURING EN-
TRANCE
COUNSELING
FOR
BORROWERS.—Section 
485(l)(2)(C) of the Higher Education Act of 1965 (20 
U.S.C. 1092(l)(2)) is amended by striking ‘‘and is capital-
ized’’. 
TITLE IV—INTEREST RATES 
SEC. 401. INTEREST RATE PROVISIONS FOR NEW FEDERAL 
STUDENT LOANS ON OR AFTER JULY 1, 2024. 
Section 455(b) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(b)) is amended— 
(1) in paragraph (8)— 
(A) in the paragraph heading, by inserting 
‘‘, AND BEFORE JULY 1, 2024’’ before the period; 
and 
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(B) by inserting ‘‘and before July 1, 
2024,’’ after ‘‘July 1, 2013,’’ each place it ap-
pears; 
(2) by redesignating paragraphs (9) and (10) 
as paragraphs (10) and (11), respectively; and 
(3) by inserting after paragraph (8) the fol-
lowing new paragraph: 
‘‘(9) INTEREST
RATE
PROVISIONS
FOR
NEW 
LOANS ON OR AFTER JULY 1, 2024.— 
‘‘(A) RATE FOR FDSL, FDUSL, AND PLUS 
LOANS.—Notwithstanding the preceding para-
graphs of this subsection, for Federal Direct 
Stafford Loans, Federal Direct Unsubsidized 
Stafford Loans, and Federal Direct PLUS 
Loans, for which the first disbursement is made 
on or after July 1, 2024, the applicable rate of 
interest shall, for loans disbursed during any 
12-month period beginning on July 1 and end-
ing on June 30, be determined on the preceding 
June 1 and be equal to the lesser of— 
‘‘(i) a rate equal to the high yield of 
the 10-year Treasury note auctioned at the 
final auction held prior to such June 1; or 
‘‘(ii) 5.0 percent. 
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‘‘(B) CONSOLIDATION
LOANS.—Notwith-
standing the preceding paragraphs of this sub-
section, any Federal Direct Consolidation Loan 
for which the application is received on or after 
July 1, 2024, shall— 
‘‘(i) bear interest at an annual rate on 
the unpaid principal balance of the loan 
that is equal to the lesser of— 
‘‘(I) the weighted average of the 
interest rates on the loans consoli-
dated, rounded to the nearest higher 
one-eighth of one percent; or 
‘‘(II) 5.0 percent; and 
‘‘(ii) only accrue interest on the per-
centage of such Federal Direct Consolida-
tion Loan that is equal to— 
‘‘(I) the amount of the sum of 
the unpaid principal on the loans con-
solidated; divided by 
‘‘(II) the total amount of such 
Federal Direct Consolidation Loan. 
‘‘(C) CONSULTATION.—The Secretary shall 
determine the applicable rate of interest under 
this paragraph after consultation with the Sec-
retary of the Treasury and shall publish such 
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rate in the Federal Register as soon as prac-
ticable after the date of determination. 
‘‘(D) FIXED RATE.—The applicable rate of 
interest determined under this paragraph for a 
Federal Direct Stafford Loan, a Federal Direct 
Unsubsidized Stafford Loan, a Federal Direct 
PLUS Loan, or a Federal Direct Consolidation 
Loan shall be fixed for the period of the loan.’’. 
SEC. 402. REFINANCING FFEL AND FEDERAL DIRECT 
LOANS. 
Part D of title IV of the Higher Education Act of 
1965 (20 U.S.C. 1087a et seq.) is amended by adding at 
the end the following: 
‘‘SEC. 460A. REFINANCING FFEL AND FEDERAL DIRECT 
LOANS. 
‘‘(a) IN GENERAL.—The Secretary shall establish a 
program under which the Secretary, upon the receipt of 
an application from a qualified borrower, makes a loan 
under this part, in accordance with the provisions of this 
section, in order to permit the borrower to obtain the in-
terest rate provided under subsection (c). 
‘‘(b) REFINANCING DIRECT LOANS.— 
‘‘(1) FEDERAL DIRECT LOANS.—Upon applica-
tion of a qualified borrower, the Secretary shall 
repay a Federal Direct Stafford Loan, a Federal Di-
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rect Unsubsidized Stafford Loan, a Federal Direct 
PLUS Loan, or a Federal Direct Consolidation 
Loan of the qualified borrower, for which the first 
disbursement was made, or the application for the 
consolidation loan was received, before July 1, 2024, 
with the proceeds of a refinanced Federal Direct 
Stafford Loan, a Federal Direct Unsubsidized Staf-
ford Loan, a Federal Direct PLUS Loan, or a Fed-
eral Direct Consolidation Loan, respectively, issued 
to the borrower in an amount equal to the sum of 
the unpaid principal, accrued unpaid interest, and 
late charges of the original loan. 
‘‘(2) REFINANCING FFEL PROGRAM LOANS AS 
REFINANCED FEDERAL DIRECT LOANS.—Upon ap-
plication of a qualified borrower for any loan that 
was made, insured, or guaranteed under part B and 
for which the first disbursement was made, or the 
application for the consolidation loan was received, 
before July 1, 2010, the Secretary shall make a loan 
under this part, in an amount equal to the sum of 
the unpaid principal, accrued unpaid interest, and 
late charges of the original loan to the borrower in 
accordance with the following: 
‘‘(A) The Secretary shall pay the proceeds 
of such loan to the eligible lender of the loan 
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made, insured, or guaranteed under part B, in 
order to discharge the borrower from any re-
maining obligation to the lender with respect to 
the original loan. 
‘‘(B) A loan made under this section that 
was originally— 
‘‘(i) a loan originally made, insured, 
or guaranteed under section 428 shall be a 
Federal Direct Stafford Loan; 
‘‘(ii) a loan originally made, insured, 
or guaranteed under section 428B shall be 
a Federal Direct PLUS Loan; 
‘‘(iii) a loan originally made, insured, 
or guaranteed under section 428H shall be 
a Federal Direct Unsubsidized Stafford 
Loan; and 
‘‘(iv) a loan originally made, insured, 
or guaranteed under section 428C shall be 
a Federal Direct Consolidation Loan. 
‘‘(C) The interest rate for each loan made 
by the Secretary under this paragraph shall be 
the rate provided under subsection (c). 
‘‘(c) INTEREST RATES.— 
‘‘(1) IN GENERAL.—The interest rate for the 
refinanced Federal Direct Stafford Loans, Federal 
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Direct Unsubsidized Stafford Loans, Federal Direct 
PLUS Loans, and Federal Direct Consolidation 
Loans, shall be a rate equal to— 
‘‘(A) in any case where the original loan 
was a loan under section 428, 428B, 428H, a 
Federal Direct Stafford loan, a Federal Direct 
Unsubsidized Stafford Loan, or a Federal Di-
rect PLUS Loan, a rate equal to the interest 
rate determined under section 455(b)(9)(A) for 
the date on which the refinanced loan is made; 
and 
‘‘(B) in any case where the original loan 
was a loan under section 428C or a Federal Di-
rect Consolidation Loan, a rate calculated in ac-
cordance with paragraph (2). 
‘‘(2) INTEREST
RATES
FOR
CONSOLIDATION 
LOANS.— 
‘‘(A) 
METHOD
OF
CALCULATION.—In 
order to determine the interest rate for any re-
financed Federal Direct Consolidation Loan 
under paragraph (1)(B), the Secretary shall— 
‘‘(i) determine each of the component 
loans that were originally consolidated in 
the loan under section 428C or the Federal 
Direct Consolidation Loan, and calculate 
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‘‘(I) the interest rate on the 
original component loan; or 
‘‘(II) 5 percent. 
‘‘(3) FIXED RATE.—The applicable rate of in-
terest determined under paragraph (1) for a refi-
nanced loan under this section shall be fixed for the 
period of the loan. 
‘‘(4) CAPITALIZED
INTEREST
AND
FEES
EX-
CLUDED.—With respect to a refinanced loan under 
this section, interest shall only accrue on the per-
centage of such refinanced loan that is equal to— 
‘‘(A) the amount of the unpaid principal of 
the original loan, or in the case of a refinanced 
Federal Direct Consolidation Loan, the sum of 
the unpaid principal of all the component loans, 
comprising the refinanced loan; divided by 
‘‘(B) the total amount of such refinanced 
loan. 
‘‘(d) TERMS AND CONDITIONS OF LOANS.— 
‘‘(1) IN GENERAL.—A loan that is refinanced 
under this section shall have the same terms and 
conditions as the original loan, except as otherwise 
provided in this section. 
‘‘(2) NO
AUTOMATIC
EXTENSION
OF
REPAY-
MENT PERIOD.—Refinancing a loan under this sec-
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tion shall not result in the extension of the duration 
of the repayment period of the loan, and the bor-
rower shall retain the same repayment term that 
was in effect on the original loan. Nothing in this 
paragraph shall be construed to prevent a borrower 
from electing a different repayment plan at any time 
in accordance with section 455(d)(4). 
‘‘(e) DEFINITION OF QUALIFIED BORROWER.—For 
purposes of this section, the term ‘qualified borrower’ 
means a borrower— 
‘‘(1) of a loan under this part or part B for 
which the first disbursement was made, or the appli-
cation for a consolidation loan was received, before 
July 1, 2024; and 
‘‘(2) who has one or more loans described in 
paragraph (1) or (2) of subsection (b) with an inter-
est rate that exceeds 5 percent. 
‘‘(f) NOTIFICATION TO BORROWERS.—The Secretary, 
in coordination with the Director of the Bureau of Con-
sumer Financial Protection, shall undertake a campaign 
to alert borrowers of loans that are eligible for refinancing 
under this section that the borrowers are eligible to apply 
for such refinancing. The campaign shall include the fol-
lowing activities: 
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‘‘(1) Developing consumer information mate-
rials about the availability of Federal student loan 
refinancing. 
‘‘(2) Requiring servicers of loans under this 
part or part B to provide such consumer information 
to borrowers in a manner determined appropriate by 
the Secretary, in consultation with the Director of 
the Bureau of Consumer Financial Protection.’’. 
SEC. 403. REFINANCING PRIVATE STUDENT LOANS. 
Part D of title IV of the Higher Education Act of 
1965 (20 U.S.C. 1087a et seq.), as amended by section 
402, is further amended by adding at the end the fol-
lowing: 
‘‘SEC. 460B. FEDERAL DIRECT REFINANCED PRIVATE LOAN 
PROGRAM. 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) ELIGIBLE PRIVATE EDUCATION LOAN.— 
The term ‘eligible private education loan’ means a 
private education loan, as defined in section 140(a) 
of the Truth in Lending Act (15 U.S.C. 1650(a)), 
that— 
‘‘(A) was disbursed to the borrower before 
July 1, 2024; and 
‘‘(B) was for the borrower’s own postsec-
ondary educational expenses for an eligible pro-
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gram at an institution of higher education par-
ticipating in the loan program under this part, 
as of the date that the loan was disbursed. 
‘‘(2) FEDERAL DIRECT REFINANCED PRIVATE 
LOAN.—The term ‘Federal Direct Refinanced Pri-
vate Loan’ means a loan issued under subsection 
(b)(1). 
‘‘(3) PRIVATE
EDUCATIONAL
LENDER.—The 
term ‘private educational lender’ has the meaning 
given the term in section 140(a) of the Truth in 
Lending Act (15 U.S.C. 1650(a)). 
‘‘(4) QUALIFIED BORROWER.—The term ‘quali-
fied borrower’ means an individual who— 
‘‘(A) has an eligible private education loan; 
‘‘(B) has been current on payments on the 
eligible private education loan for the 6 months 
prior to the date of the qualified borrower’s ap-
plication for refinancing under this section, and 
is in good standing on the loan at the time of 
such application; 
‘‘(C) is not in default on the eligible pri-
vate education loan or on any loan made, in-
sured, or guaranteed under this part or part B 
or E; and 
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‘‘(D) meets the eligibility requirements de-
scribed in subsection (b)(2). 
‘‘(b) PROGRAM AUTHORIZED.— 
‘‘(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of the Treasury, shall carry 
out a program under which the Secretary, upon ap-
plication by a qualified borrower who has an eligible 
private education loan, shall issue such borrower a 
loan under this part in accordance with the fol-
lowing: 
‘‘(A) The loan issued under this program 
shall be in an amount equal to the sum of the 
unpaid principal, accrued unpaid interest, and 
late charges of the private education loan. 
‘‘(B) The Secretary shall pay the proceeds 
of the loan issued under this program to the 
private educational lender of the private edu-
cation loan, in order to discharge the qualified 
borrower from any remaining obligation to the 
lender with respect to the original loan. 
‘‘(C) The Secretary shall require that the 
qualified borrower undergo loan counseling that 
provides all of the relevant information and 
counseling required under section 485(l)(2) be-
fore the loan is refinanced in accordance with 
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this section, and before the proceeds of such 
loan are paid to the private educational lender. 
‘‘(D) The Secretary shall issue the loan as 
a Federal Direct Refinanced Private Loan, 
which shall have the same terms, conditions, 
and benefits as a Federal Direct Unsubsidized 
Stafford Loan, except as otherwise provided in 
this section. 
‘‘(E) The interest rate for each loan made 
by the Secretary under this section shall be the 
rate provided under subsection (c). 
‘‘(2) BORROWER ELIGIBILITY.—The Secretary, 
in consultation with the Secretary of the Treasury 
and the Director of the Consumer Financial Protec-
tion Bureau, shall establish eligibility require-
ments— 
‘‘(A) to ensure eligibility only for borrowers 
in good standing; 
‘‘(B) to minimize inequities between Fed-
eral Direct Refinanced Private Loans and other 
Federal student loans; 
‘‘(C) to preclude windfall profits for pri-
vate educational lenders; and 
‘‘(D) to ensure full access to the program 
authorized in this subsection for borrowers with 
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‘‘(d) NO INCLUSION IN AGGREGATE LIMITS.—The 
amount of a Federal Direct Refinanced Private Loan, or 
a Federal Direct Consolidated Loan to the extent such 
loan was used to repay a Federal Direct Refinanced Pri-
vate Loan, shall not be included in calculating a bor-
rower’s annual or aggregate loan limits under section 428 
or 428H. 
‘‘(e) NO ELIGIBILITY FOR SERVICE-RELATED RE-
PAYMENT.—A Federal Direct Refinanced Private Loan, or 
any Federal Direct Consolidation Loan to the extent such 
loan was used to repay a Federal Direct Refinanced Pri-
vate Loan, shall not be eligible for any loan repayment 
or loan forgiveness program under section 428K, 428L, 
or 460 or for the loan cancellation repayment plan for 
public service employees under section 455(m). 
‘‘(f) PRIVATE EDUCATIONAL LENDER REPORTING 
REQUIREMENT.— 
‘‘(1) REPORTING
REQUIRED.—The Secretary, 
in consultation with the Secretary of the Treasury 
and the Director of the Bureau of Consumer Finan-
cial Protection, shall establish a requirement that, in 
order to allow for an assessment of the private edu-
cation loan market, private educational lenders re-
port the data described in paragraph (2) to— 
‘‘(A) the Secretary; 
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‘‘(B) the Secretary of the Treasury; 
‘‘(C) the Director of the Consumer Finan-
cial Protection Bureau; 
‘‘(D) the Committee on Education and 
Labor of the House of Representatives; 
‘‘(E) the Committee on Financial Services 
of the House of Representatives; 
‘‘(F) the Senate Committee on Health, 
Education, Labor, and Pensions; and 
‘‘(G) the Senate Committee on Banking, 
Housing, and Urban Affairs. 
‘‘(2) CONTENTS
OF
REPORTING.—The data 
that private educational lenders shall report in ac-
cordance with paragraph (1) shall include each of 
the following about private education loans (as de-
fined in section 140(a) of the Truth in Lending Act 
(15 U.S.C. 1650(a))): 
‘‘(A) The total amount of private education 
loan debt the lender holds. 
‘‘(B) The total number of private edu-
cation loan borrowers the lender serves. 
‘‘(C) The average interest rate on the out-
standing private education loan debt held by the 
lender. 
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‘‘(D) The proportion of private education 
loan borrowers who are in default on a loan 
held by the lender. 
‘‘(E) The proportion of the outstanding 
private education loan volume held by the lend-
er that is in default. 
‘‘(F) The proportions of outstanding pri-
vate education loan borrowers who are 30, 60, 
and 90 days delinquent. 
‘‘(G) The proportions of outstanding pri-
vate education loan volume that is 30, 60, and 
90 days delinquent. 
‘‘(g) NOTIFICATION
TO
BORROWERS.—The Sec-
retary, in coordination with the Secretary of the Treasury 
and the Director of the Consumer Financial Protection 
Bureau, shall undertake a campaign to alert borrowers 
about the availability of private student loan refinancing 
under this section.’’. 
Æ 
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