I 
109TH CONGRESS 
1ST SESSION H. R. 1338 
To amend the Higher Education Act of 1965 to permit refinancing of student 
consolidation loans, increase Pell Grant maximum awards, and for other 
purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 16, 2005 
Ms. DELAURO (for herself, Mr. CROWLEY, Mr. JEFFERSON, Mr. PALLONE, 
Mr. BRADLEY of New Hampshire, Mr. LARSON of Connecticut, Ms. LEE, 
Ms. SLAUGHTER, Mr. CONYERS, Mr. GENE GREEN of Texas, Mr. 
WEXLER, Mr. MICHAUD, Mr. MORAN of Virginia, Mr. ISRAEL, Mr. 
MCDERMOTT, Mr. FARR, Mr. WAXMAN, Mr. STRICKLAND, Mrs. JONES 
of Ohio, Mr. LANTOS, Mr. JACKSON of Illinois, and Mr. GONZALEZ) in-
troduced the following bill; which was referred to the Committee on Edu-
cation and the Workforce 
A BILL 
To amend the Higher Education Act of 1965 to permit 
refinancing of student consolidation loans, increase Pell 
Grant maximum awards, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘College Loan Assist-
ance Act of 2005’’.
SEC. 2. REMOVAL OF PROHIBITION ON REFINANCING CON-
SOLIDATION LOANS. 
(a) REMOVAL OF PROHIBITION.—Section 428C(a)(3) 
the Higher Education Act of 1965 (20 U.S.C. 1078– 
3(a)(3)) is amended— 
(1) by striking subparagraph (B); 
(2) in subparagraph (C), by striking ‘‘subpara-
graphs (A) and (B)’’ and inserting ‘‘subparagraph 
(A)’’; and 
(3) by redesignating subparagraph (C) as sub-
paragraph (B). 
(b) REDUCTION OF CAP ON INTEREST RATE.—Sec-
tion 427A(l)(3) of such Act (20 U.S.C. 1077a(l)(3)) is 
amended by striking subparagraph (B) and inserting the 
following: 
‘‘(B) 6.8 percent.’’. 
SEC. 3. EXTENSION AND INCREASE OF PELL GRANT MAX-
IMUM AMOUNTS. 
Section 401(b)(2)(A) of the Higher Education Act of 
1965 (20 U.S.C. 1070a(b)(2)(A)) is amended by striking 
‘‘shall be—’’ and all that follows through ‘‘less an 
amount’’ and inserting ‘‘shall be $7,000 for academic year 
2006–2007 and each of the 4 succeeding academic years, 
less an amount’’.
SEC. 4. ELIMINATION OF LOAN FEES TO BORROWERS. 
(a) FEDERAL
FAMILY
EDUCATION
LOAN
PRO-
GRAM.—Section 438(c) of the Higher Education Act of 
1965 (20 U.S.C. 1087–1(c)) is amended by adding at the 
end the following new paragraph: 
‘‘(9) ORIGINATION
FEES
TERMINATED.—Not-
withstanding any other provision of this subsection, 
with respect to any loan made, insured, or guaran-
teed under this part on or after the first July 1 after 
the date of enactment of the College Loan Assist-
ance Act of 2005— 
‘‘(A) no eligible lender may collect directly 
or indirectly from any borrower any origination 
fee with respect to such loan, or any other fee 
relating to the origination of a loan however de-
scribed; and 
‘‘(B) the Secretary shall not collect any 
origination fee from the lender under this sub-
section.’’. 
(b) FEDERAL DIRECT LOAN PROGRAM.—Section 
455(c) of such Act (20 U.S.C. 1087e(c)) is amended to 
read as follows: 
‘‘(c) LOAN FEE.— 
‘‘(1) TEMPORARY PROVISION.—Subject to para-
graph (2), the Secretary shall charge the borrower
of a loan made under this part an origination fee of 
4.0 percent of the principal amount of loan. 
‘‘(2) TERMINATION
OF
ORIGINATION
FEE.— 
With respect to any loan made under this part on 
or after the first July 1 after the date of enactment 
of College Loan Assistance Act of 2005, the Sec-
retary shall not collect directly or indirectly from 
any borrower any origination fee with respect to 
such loan, or any other fee relating to the origina-
tion of a loan however described.’’. 
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