I 
118TH CONGRESS 
1ST SESSION H. R. 1731 
To amend the Higher Education Act of 1965 to double the Pell Grant 
award amount, improve the Public Service Loan Forgiveness program, 
and reduce interest rates, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 22, 2023 
Ms. WILSON of Florida (for herself, Mrs. MCBATH, Mr. COURTNEY, Mr. 
SABLAN, Ms. BONAMICI, Mr. GRIJALVA, Ms. ADAMS, and Mr. TAKANO) 
introduced the following bill; which was referred to the Committee on 
Education and the Workforce, and in addition to the Committee on the 
Budget, for a period to be subsequently determined by the Speaker, in 
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned 
A BILL 
To amend the Higher Education Act of 1965 to double 
the Pell Grant award amount, improve the Public Service 
Loan Forgiveness program, and reduce interest rates, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE; EFFECTIVE DATE; TABLE OF 
CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Lowering Obstacles to Achievement Now Act’’ or the 
‘‘LOAN Act’’. 
(b) EFFECTIVE DATE.—Except as otherwise ex-
pressly provided herein, any amendment made by this Act 
to section 401, 473, or 484 of the Higher Education Act 
of 1965 (20 U.S.C. 1070a; 1087mm; 1091), as amended 
by the FAFSA Simplification Act (title VII of division FF 
of Public Law 116–260), shall take effect as if included 
in the FAFSA Simplification Act and subject to the effec-
tive date of section 701(b) of such FAFSA Simplification 
Act, as amended by section 102(a) of the FAFSA Sim-
plification Act Technical Corrections Act (division R of 
Public Law 117–103) (including the authorization pro-
vided under section 102(c)(1)(A) of such Act). 
(c) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows: 
Sec. 1. Short title; effective date; table of contents. 
TITLE I—FEDERAL PELL GRANTS 
Sec. 101. Doubling Federal Pell Grants and providing all Federal Pell Grants 
through mandatory funding. 
Sec. 102. Providing increased Federal Pell Grants and other assistance for re-
cipients of means-tested benefits. 
Sec. 103. Federal aid eligibility for dreamer students. 
Sec. 104. Restoring the total semesters of Federal Pell Grant eligibility. 
Sec. 105. Reducing financial aid penalties from satisfactory academic progress 
determinations. 
Sec. 106. Federal Pell Grants for graduate students. 
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TITLE II—AMENDMENTS TO TERMS AND CONDITIONS OF LOANS 
AND REPAYMENT PLANS 
PART A—DIRECT LOANS 
Sec. 201. Subsidized loans for graduate and professional students. 
Sec. 202. Repeal of origination fees. 
Sec. 203. Prepayment amounts. 
PART B—AUTOMATIC ENROLLMENT IN INCOME-DRIVEN REPAYMENT FOR 
CERTAIN BORROWERS 
Sec. 211. Notification and automatic enrollment procedures for borrowers who 
are delinquent on loans. 
Sec. 212. Notification and automatic enrollment procedures for borrowers who 
are rehabilitating defaulted loans. 
Sec. 213. Covered loan, income-driven repayment plan, and non-covered loan 
defined. 
Sec. 214. Automatic recertification of income for income-driven repayment 
plans. 
Sec. 215. Procedure and requirement for requesting tax return information 
from the IRS. 
PART C—AMENDMENTS TO CERTAIN LOAN FORGIVENESS PROGRAMS 
Sec. 221. Amendments to terms and conditions of Public Service Loan Forgive-
ness. 
Sec. 222. Loan forgiveness for teachers. 
TITLE III—INTEREST CAPITALIZATION 
Sec. 301. Elimination of interest capitalization. 
Sec. 302. Elimination of disclosure requirements relating to capitalization. 
TITLE IV—INTEREST RATES 
Sec. 401. Interest rate provisions for new Federal student loans on or after 
July 1, 2024. 
Sec. 402. Refinancing FFEL and Federal Direct Loans. 
Sec. 403. Refinancing private student loans. 
TITLE I—FEDERAL PELL 
GRANTS 
SEC. 101. DOUBLING FEDERAL PELL GRANTS AND PRO-
VIDING 
ALL 
FEDERAL 
PELL 
GRANTS 
THROUGH MANDATORY FUNDING. 
(a) 
AMOUNT
OF
MINIMUM
FEDERAL
PELL 
GRANTS.—Section 401 of the Higher Education Act of 
1965 (20 U.S.C. 1070a), as amended by title VII of divi-
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sion FF of the FAFSA Simplification Act (Public Law 
116–260), is amended— 
(1) in subsection (a)(2)(F), by striking ‘‘10 per-
cent’’ and inserting ‘‘5 percent’’; 
(2) in subsection (b)— 
(A) in paragraph (1)(B)(i), by striking 
‘‘paragraph (5)(A)’’ and inserting ‘‘paragraph 
(5)’’; 
(B) by striking paragraph (5) and insert-
ing the following: 
‘‘(5) 
TOTAL
MAXIMUM
FEDERAL
PELL 
GRANT.— 
‘‘(A) AWARD YEAR 2024–2025.—For award 
year 2024–2025, the total maximum Federal 
Pell Grant award shall be $10,000. 
‘‘(B) AWARD YEAR 2025–2026.—For award 
year 2025–2026, the total maximum Federal 
Pell Grant award shall be $11,000. 
‘‘(C) AWARD YEAR 2026–2027.—For award 
year 2026–2027, the total maximum Federal 
Pell Grant award shall be $12,000. 
‘‘(D) AWARD YEAR 2027–2028.—For award 
year 2027–2028, the total maximum Federal 
Pell Grant award shall be $13,000. 
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‘‘(E) AWARD YEAR 2028–2029.—For award 
year 2028–2029, the total maximum Federal 
Pell Grant award shall be $14,000. 
‘‘(F) AWARD YEAR 2029–2030 AND SUBSE-
QUENT
YEARS.—For award year 2029–2030, 
and each subsequent award year, the total max-
imum Federal Pell Grant award shall be 
$14,000— 
‘‘(i) increased by the adjustment per-
centage for the award year for which the 
amount under this subparagraph is being 
determined; and 
‘‘(ii) rounded to the nearest $50. 
‘‘(G) DEFINITION OF ADJUSTMENT PER-
CENTAGE.—In this paragraph, the term ‘adjust-
ment percentage,’ as applied to an award year, 
is equal to the percentage increase in the Con-
sumer Price Index, as defined in section 478(f), 
for the most recent calendar year ending prior 
to the beginning of the award year.’’; 
(C) by striking paragraphs (6) and (7) and 
inserting the following: 
‘‘(6) APPROPRIATION
OF
FUNDS.—There are 
authorized to be appropriated, and there are appro-
priated, out of any money in the Treasury not other-
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wise appropriated, such sums as may be necessary 
for fiscal year 2024 and each subsequent fiscal year 
to provide the total maximum Federal Pell Grant for 
which a student shall be eligible under this section 
during an award year.’’; and 
(D) by redesignating paragraphs (8) and 
(9) as paragraphs (7) and (8), respectively; 
(3) in subsection (d)(5)(B)(ii)— 
(A) in subclause (I)(bb), by striking ‘‘or’’ 
after the semicolon; 
(B) in subclause (II)(bb)(CC), by striking 
the period and inserting ‘‘; or’’; and 
(C) by adding at the end the following: 
‘‘(III) during a period for which 
the student did not receive a loan 
under this title but for which, if the 
student had received such a loan, such 
loan would have been discharged 
under the circumstances described in 
subclause (II)(bb)(CC).’’; 
(4) by striking subsections (g) and (h); and 
(5) by redesignating subsections (i) and (j) as 
subsections (g) and (h), respectively. 
(b) REPEAL OF SCORING REQUIREMENT.— 
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(1) IN GENERAL.—Section 406 of H. Con. Res. 
95 (109th Congress) is amended— 
(A) by striking subsection (b); and 
(B) by striking ‘‘(a) IN GENERAL.—Upon’’ 
and inserting the following: ‘‘Upon’’. 
(2) EFFECTIVE DATE.—The amendments made 
by paragraph (1) shall take effect beginning on July 
1, 2024. 
(c) 
STUDENT
SUPPORT
SERVICES.—Section 
402D(d)(1) of the Higher Education Act of 1965 (20 
U.S.C. 1070a–14(d)(1)) is amended by striking ‘‘the min-
imum’’ and inserting ‘‘10 percent of the maximum’’. 
(d) SCHOLARSHIP COMPONENT.—Section 404E(d) of 
the Higher Education Act of 1965 (20 U.S.C. 1070a– 
25(d)) is amended by striking ‘‘less than the minimum’’ 
and inserting ‘‘less than 10 percent of the maximum’’. 
SEC. 102. PROVIDING INCREASED FEDERAL PELL GRANTS 
AND OTHER ASSISTANCE FOR RECIPIENTS 
OF MEANS-TESTED BENEFITS. 
(a) INCREASED AMOUNT
OF MAXIMUM FEDERAL 
PELL GRANTS FOR STUDENTS WITH NEGATIVE STU-
DENT AID INDEXES.—Section 401(b)(1) of the Higher 
Education Act of 1965 (20 U.S.C. 1070a(b)(1)), as 
amended by section 101 of this Act and section 703 of 
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the FAFSA Simplification Act (Public Law 116–260), is 
amended— 
(1) in subparagraph (A)— 
(A) in the matter preceding clause (i), by 
striking ‘‘A student’’ and inserting ‘‘Except in 
the case of a student with a student aid index 
of less than zero, a student’’; 
(B) by striking clause (i); and 
(C) by redesignating clauses (ii) and (iii) 
as clauses (i) and (ii), respectively; 
(2) 
by 
redesignating 
subparagraphs 
(B) 
through (E) as subparagraphs (C) through (F), re-
spectively; 
(3) by inserting after subparagraph (A) the fol-
lowing: 
‘‘(B) A student with a student aid index of 
less than zero shall be eligible for a Federal 
Pell Grant award that exceeds the total max-
imum Federal Pell Grant by an amount equal 
to the amount by which the student’s student 
aid index is less than zero.’’; 
(4) in subparagraph (C), as redesignated by 
paragraph (2)— 
(A) in the matter preceding clause (i), by 
striking ‘‘subparagraph (A) for an academic 
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year,’’ and inserting ‘‘subparagraph (A), or an 
increased Federal Pell Grant under subpara-
graph (B), for an academic year,’’; and 
(B) in clause (ii), by striking ‘‘, except that 
a student aid index of less than zero shall be 
considered to be zero for the purposes of this 
clause’’; 
(5) in subparagraph (D), as redesignated by 
paragraph (2), by striking ‘‘(A) or (B)’’ and insert-
ing ‘‘(A), (B), or (C)’’; 
(6) in subparagraph (E), as redesignated by 
paragraph (2), by inserting ‘‘or an increased Federal 
Pell Grant under subparagraph (B)’’ after ‘‘subpara-
graph (A)’’; or 
(7) in subparagraph (F), as redesignated by 
paragraph (2), by striking ‘‘or a minimum Federal 
Pell Grant under subparagraph (C)’’ and inserting 
‘‘an increased Federal Pell Grant under subpara-
graph (B), or a minimum Federal Pell Grant under 
subparagraph (D)’’. 
(b) SPECIAL STUDENT AID INDEX RULE FOR RE-
CIPIENTS OF MEANS-TESTED BENEFITS.—Section 473 of 
the Higher Education Act of 1965 (20 U.S.C. 1087mm), 
as amended by section 702(b) of the FAFSA Simplifica-
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tion Act (Public Law 116–260), is amended by adding at 
the end the following: 
‘‘(d) SPECIAL RULE FOR MEANS-TESTED BENEFIT 
RECIPIENTS.—Notwithstanding subsection (b), for an ap-
plicant (or, as applicable, an applicant and spouse, or an 
applicant’s parents) who, at any time during the previous 
24-month period, received a benefit under a means-tested 
Federal benefit program (or whose parent or spouse re-
ceived such a benefit, as applicable), the Secretary shall 
for the purposes of this title consider the student aid index 
as equal to –$1,500 for the applicant.’’. 
SEC. 103. FEDERAL AID ELIGIBILITY FOR DREAMER STU-
DENTS. 
Section 484 of the Higher Education Act of 1965 (20 
U.S.C. 1091), as amended by section 702(n) of the 
FAFSA Simplification Act (Public Law 116–260), is 
amended— 
(1) in subsection (a)(5), by inserting ‘‘, or be a 
Dreamer student, as defined in subsection (u)’’ after 
‘‘becoming a citizen or permanent resident’’; and 
(2) by adding at the end the following: 
‘‘(u) DREAMER STUDENTS.— 
‘‘(1) IN GENERAL.—In this section, the term 
‘Dreamer student’ means an individual who— 
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‘‘(A)(i) is not a citizen or national of the 
United States; and 
‘‘(ii) is inadmissible or deportable under 
the Immigration and Nationality Act (8 U.S.C. 
1101 et seq.)); and 
‘‘(B)(i) in the case of such an individual 
who was younger than 18 years of age on the 
date on which the individual initially entered 
the United States— 
‘‘(I) has earned a high school diploma, 
the recognized equivalent of such diploma 
from a secondary school, or a high school 
equivalency diploma recognized by State 
law, or is scheduled to complete the re-
quirements for such a diploma or equiva-
lent before the next academic year begins; 
‘‘(II) is enrolled at an institution of 
higher education pursuant to subsection 
(d); 
‘‘(III) has served in the uniformed 
services (as such term is defined in section 
101 of title 10, United States Code) for 
not less than 2 years and, if discharged, 
received an honorable discharge; 
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‘‘(IV) has acquired a degree, certifi-
cate, or recognized postsecondary creden-
tial from an institution of higher education 
or area career and technical education 
school (as such term is defined in section 
3 of the Carl D. Perkins Career and Tech-
nical Education Act of 2006 (20 U.S.C. 
2302)); or 
‘‘(V) has completed not less than 2 
years in a postsecondary program at an in-
stitution of higher education, or area ca-
reer and technical education school, in the 
United States and has made satisfactory 
academic progress, as defined in subsection 
(c), during such time period; or 
‘‘(ii)(I) is, or at any time was, eligible for 
a grant of deferred action pursuant to— 
‘‘(aa) the memorandum of the De-
partment of Homeland Security entitled 
‘Exercising Prosecutorial Discretion with 
Respect to Individuals Who Came to the 
United States as Children’ issued on June 
15, 2012; or 
‘‘(bb) the memorandum of the De-
partment of Homeland Security entitled 
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‘Exercising Prosecutorial Discretion with 
Respect to Individuals Who Came to the 
United States as Children and with Re-
spect to Certain Individuals Who Are the 
Parents of U.S. Citizens or Permanent 
Residents’ issued on November 20, 2014; 
or 
‘‘(II) would have been eligible for such a 
grant of deferred action if the applicable memo-
randum described in subclause (I) had been 
fully in effect since the date on which it was 
issued. 
‘‘(2) HARDSHIP
EXCEPTION.—The Secretary 
shall issue regulations that direct when the Depart-
ment shall waive the age requirement of paragraph 
(1)(B)(i) for an individual to qualify as a Dreamer 
student under such paragraph, if the individual dem-
onstrates compelling circumstances, such as eco-
nomic hardship (as defined in section 435(o)).’’. 
SEC. 104. RESTORING THE TOTAL SEMESTERS OF FEDERAL 
PELL GRANT ELIGIBILITY. 
Section 401(d)(5)(A) of the Higher Education Act of 
1965, as added by section 703 of the FAFSA Simplifica-
tion Act (Public Law 116–260), is amended by striking 
‘‘12’’ each place the term appears and inserting ‘‘18’’. 
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SEC. 105. REDUCING FINANCIAL AID PENALTIES FROM SAT-
ISFACTORY ACADEMIC PROGRESS DETER-
MINATIONS. 
Section 484(c) of the Higher Education Act of 1965 
(20 U.S.C. 1091(c)) is amended to read as follows: 
‘‘(c) SATISFACTORY PROGRESS.— 
‘‘(1) DEFINITIONS.—In this subsection: 
‘‘(A) APPEAL.—The term ‘appeal’ means a 
process by which a student who is not meeting 
the institution’s satisfactory academic progress 
standards petitions the institution for reconsid-
eration of the student’s eligibility for assistance 
under this title. 
‘‘(B) FINANCIAL
AID
PROBATION.—The 
term ‘financial aid probation’ means a status 
assigned by an institution to a student who fails 
to make satisfactory academic progress and 
who has appealed and has had eligibility for aid 
reinstated. 
‘‘(C) FINANCIAL AID WARNING.—The term 
‘financial aid warning’ means a status assigned 
to a student who fails to make satisfactory aca-
demic progress at the end of the semester or 
equivalent period in which the student first fails 
to make such progress. 
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‘‘(D) PAYMENT PERIOD.—The term ‘pay-
ment period’ means the applicable payment pe-
riod described in section 668.4 of title 34, Code 
of Federal Regulations, or any successor regula-
tion. 
‘‘(2) SATISFACTORY ACADEMIC PROGRESS POL-
ICY.—An institution shall establish a reasonable sat-
isfactory academic progress policy for determining 
whether an otherwise eligible student is making sat-
isfactory academic progress in the student’s edu-
cational program and may receive assistance under 
this title. The Secretary shall consider the institu-
tion’s policy to be reasonable if— 
‘‘(A) the policy is at least as strict as the 
policy the institution applies to a student who 
is not receiving assistance under this title; 
‘‘(B) the policy provides for consistent ap-
plication of standards to all students, including 
full-time, part-time, undergraduate, and grad-
uate students, and all educational programs es-
tablished by the institution; 
‘‘(C)(i) the policy specifies the grade point 
average that a student must achieve at each 
evaluation, or if a grade point average is not an 
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appropriate qualitative measure, a comparable 
assessment measured against a norm; and 
‘‘(ii) if a student is enrolled in an edu-
cational program of more than 2 academic 
years, the policy specifies that at the end of the 
second academic year, the student must have a 
grade point average of at least a ‘C’ or its 
equivalent, or have academic standing con-
sistent with the institution’s requirements for 
graduation; 
‘‘(D) the policy provides for measurement 
of the student’s progress at each evaluation; 
‘‘(E) the policy describes— 
‘‘(i) how a student’s grade point aver-
age and the pace at which the student pro-
gresses toward completion are affected by 
course incompletes, withdrawals, or repeti-
tions, or transfers of credit from other in-
stitutions, including that credit hours from 
another institution that are accepted to-
ward the student’s educational program 
are counted as both attempted and com-
pleted hours; and 
‘‘(ii) how after a student reenrolls 
after the student’s satisfactory academic 
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progress was reset pursuant to paragraph 
(3)(B), the student may have any credits 
that were earned before the student was 
determined not to be making satisfactory 
academic progress counted for purposes of 
determining progress when the student re-
enrolls, but any attempted hours that were 
not earned by the student (including in-
completes, withdrawn courses, and failed 
courses) before the student was determined 
not to be making satisfactory academic 
progress will not negatively impact the de-
termination of whether the student made 
satisfactory academic progress after such 
reset; 
‘‘(F) the policy provides that, except as 
provided in subparagraph (G) with respect to a 
student placed on financial aid warning or fi-
nancial aid probation and paragraph (3), a stu-
dent is no longer eligible to receive assistance 
under this title if the student has not achieved 
the required grade point average or who is not 
making progress toward completion in the stu-
dent’s educational program— 
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‘‘(i) at the time of each evaluation 
with respect to a student who is in an edu-
cational program of 2 academic years or 
less in length; or 
‘‘(ii) at the end of the second aca-
demic year with respect to a student who 
is in an educational program of more than 
2 academic years in length; 
‘‘(G) the policy describes when students 
will be placed on financial aid warning or finan-
cial aid probation, in accordance with para-
graph (4), and provides that— 
‘‘(i) a student on financial aid warn-
ing— 
‘‘(I) 
shall 
receive 
assistance 
under this title for one payment pe-
riod despite a determination that the 
student is not making satisfactory 
academic progress; and 
‘‘(II) may be assigned such sta-
tus without an appeal or other action 
by the student; and 
‘‘(ii)(I) a student on financial aid pro-
bation may receive assistance under this 
title for one payment period and the insti-
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tution may require the student to fulfill 
specific terms and conditions, such as tak-
ing a reduced course load or enrolling in 
specific courses; and 
‘‘(II) at the end of such one payment 
period, the student is required to meet the 
institution’s satisfactory academic progress 
standards, or meet the requirements of the 
academic plan developed by the institution 
and the student, in order to qualify for 
continued assistance under this title; 
‘‘(H) if the institution permits a student to 
appeal a determination by the institution that 
the student is not making satisfactory academic 
progress, the policy describes— 
‘‘(i) how the student may reestablish 
the student’s eligibility to receive assist-
ance under this title; 
‘‘(ii) the basis on which the student 
may file an appeal, including because of 
the death of a relative, an injury or illness 
of the student, or another special cir-
cumstance; and 
‘‘(iii) information the student is re-
quired to submit regarding why the stu-
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dent failed to make satisfactory academic 
progress, and what has changed in the stu-
dent’s situation that will allow the student 
to 
demonstrate 
satisfactory 
academic 
progress at the next evaluation; 
‘‘(I) if the institution does not permit a 
student to appeal a determination by the insti-
tution that the student is not making satisfac-
tory academic progress, the policy describes 
how the student may reestablish the student’s 
eligibility to receive assistance under this title; 
‘‘(J) the policy provides for notification to 
students of the results of an evaluation that im-
pacts the student’s eligibility for assistance 
under this title; and 
‘‘(K) the policy does not impose satisfac-
tory progress limitations on need-based institu-
tional aid that are more stringent than the 
standard applied under this subsection without 
demonstrating to the Secretary the effectiveness 
of such limitations on improving student per-
sistence in, and completion of, postsecondary 
study. 
‘‘(3) REGAINING ELIGIBILITY.— 
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‘‘(A) 
STUDENTS
WHO
REMAIN
IN 
SCHOOL.—Whenever a student fails to meet the 
eligibility requirements of subsection (a)(2) as a 
result of the application of this subsection and, 
subsequent to that failure, the student has aca-
demic standing for any grading period con-
sistent with the requirements for staying on 
track to graduate within 150 percent of the 
published length of the educational program, as 
determined by the institution, the student shall 
again be eligible under subsection (a)(2) for a 
grant, loan, or work assistance under this title, 
as long as the student maintains satisfactory 
academic progress under paragraph (2) begin-
ning on and after the date that the student re-
gains eligibility. 
‘‘(B) STUDENTS WHO LEAVE SCHOOL.— 
‘‘(i) IN GENERAL.—If a student has 
not been enrolled in any institution of 
higher education for the immediately pre-
ceding 2 years, any previous failure to 
meet the eligibility requirements of sub-
section (a)(2) shall not be used in any de-
termination of eligibility of such student 
under such subsection. Such student shall, 
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on the date of enrollment subsequent to 
such 2-year period, have the student’s eli-
gibility for a grant, loan, or work assist-
ance under this title reset and be deemed 
as meeting the requirements described in 
paragraph (2). Beginning on and after 
such date, the student’s satisfactory aca-
demic progress shall be determined in ac-
cordance with paragraph (2)(E)(ii). 
‘‘(ii) 
MAXIMUM
NUMBER
OF 
RESETS.—A student shall be eligible for a 
reset of eligibility pursuant to this sub-
paragraph not more than 2 times. 
‘‘(C) DUTIES OF THE SECRETARY.—The 
Secretary shall— 
‘‘(i) send, to each student who failed 
to meet the eligibility requirements of sub-
section (a)(2) and who has not regained 
eligibility for a grant, loan, or work assist-
ance under subparagraph (A), a notice, 
two years after such failure, that in-
cludes— 
‘‘(I) a notification that, if the 
student has not been enrolled in any 
institution of higher education for the 
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preceding two years and has not re-
ceived two resets of eligibility under 
subparagraph (B), the student may 
use grant, loan, or work assistance 
under this title for enrollment at any 
eligible institution, including an insti-
tution other than the institution in 
which the student was previously en-
rolled; 
‘‘(II) a notification that, if the 
student has remained enrolled, or re-
sumed enrollment, at an institution of 
higher education, the student may be 
eligible for a grant, loan, or work as-
sistance under this title subject to the 
requirements of subparagraph (A); 
‘‘(III) information on how many 
semesters of eligibility for a grant, 
loan, or work assistance under this 
title to which the student still has ac-
cess; and 
‘‘(IV) a notification that the stu-
dent should ask any prospective eligi-
ble institution how many of the stu-
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dent’s previously completed credits the 
student would be able to transfer; and 
‘‘(ii) submit an annual report to Con-
gress on the outcomes of students who 
have received a reset of eligibility pursuant 
to this paragraph, including— 
‘‘(I) the number of students who 
reenroll in an eligible institution after 
such reset, disaggregated by race or 
ethnicity, sex, age, socioeconomic sta-
tus, and disability status; 
‘‘(II) the 250 eligible institutions 
with the highest numbers of enrolled 
students receiving grant, loan, or 
work assistance under this title after 
such a reset; 
‘‘(III) the 250 eligible institu-
tions with the highest share of en-
rolled students receiving grant, loan, 
or work assistance under this title 
after such a reset; and 
‘‘(IV) the average completion 
rate and time to completion for stu-
dents who reenroll in an eligible insti-
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tution after such reset, disaggregated 
by institution. 
‘‘(4) EVALUATION OF ACADEMIC PROGRESS.— 
‘‘(A) IN
GENERAL.—An institution that 
determines that a student is not making satis-
factory academic progress under its policy may 
disburse funds provided through student finan-
cial assistance programs under this title (in-
cluding work-study programs under subtitle C) 
to the student in accordance with subpara-
graphs (B), (C), and (D). 
‘‘(B) PAYMENT PERIOD FOLLOWING NOT 
MAKING SATISFACTORY ACADEMIC PROGRESS.— 
For the payment period following the payment 
period in which a student did not make satis-
factory academic progress, the institution shall 
place the student on financial aid warning and 
disburse funds under this title to the student. 
‘‘(C) PAYMENT
PERIOD
FOLLOWING
FI-
NANCIAL AID WARNING.—For the payment pe-
riod following a payment period during which a 
student was on financial aid warning, the insti-
tution may place the student on financial aid 
probation, and disburse funds under this title to 
the student if— 
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‘‘(i) the institution evaluates the stu-
dent’s progress and determines that stu-
dent did not make satisfactory academic 
progress during the payment period the 
student was on financial aid warning; 
‘‘(ii) the student appeals the deter-
mination; and 
‘‘(iii)(I) the institution determines 
that the student should be able to meet the 
institution’s satisfactory academic progress 
standards by the end of the subsequent 
payment period; or 
‘‘(II) the institution develops an aca-
demic plan for the student that, if fol-
lowed, will ensure that the student is able 
to meet the institution’s satisfactory aca-
demic progress standards by a specific 
point in time. 
‘‘(D) PAYMENT
PERIOD
FOLLOWING
FI-
NANCIAL AID PROBATION.—A student on finan-
cial aid probation for a payment period may not 
receive funds under this title for the subsequent 
payment period unless the student makes satis-
factory academic progress or the institution de-
termines that the student met the requirements 
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specified by the institution in the academic plan 
for the student developed under subparagraph 
(C)(iii)(II). 
‘‘(E) FREQUENCY OF ACADEMIC PROGRESS 
EVALUATION AND COMMUNICATION.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), for the purpose of determining wheth-
er presently enrolled students are main-
taining satisfactory progress, each institu-
tion of higher education that enrolls stu-
dents who receive any grant, loan, or work 
assistance under this title shall review the 
progress of such students at the end of 
each payment period. 
‘‘(ii) SHORTER PAYMENT PERIODS.— 
For each institution described in clause (i) 
that has payment periods that are shorter 
than on the semester system basis (such as 
on a quarterly or trimester system basis or 
by clock hour program or non-term pro-
gram), such institution shall review the 
progress of presently enrolled students at 
the end of each semester or equivalent pe-
riod of 12 to 18 weeks. 
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‘‘(iii) FINANCIAL
AID
WARNING.—At 
the end of each payment period (or, in the 
case of an institution described in clause 
(ii), at the end of each semester or equiva-
lent period), each institution shall send a 
financial aid warning to presently enrolled 
students that do not meet the grade point 
average requirement described in para-
graph (2), or its equivalent or academic 
standing consistent with the requirements 
for graduation, as determined by the insti-
tution, that informs the students of their 
risk of being determined to not be main-
taining satisfactory progress and therefore 
losing eligibility for grant, loan, or work 
assistance under this title and provides in-
formation on— 
‘‘(I) the specific criteria of the in-
stitution’s academic requirements that 
the student is not meeting and the 
specific improvements needed to meet 
the requirements; and 
‘‘(II) how to meet with the stu-
dent’s academic advisor to get the 
academic support the student needs. 
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‘‘(5) DETAILING
REQUIREMENTS
TO
STU-
DENTS.—Each institution of higher education that 
enrolls students who receive any grant, loan, or work 
assistance under this title shall detail the institu-
tion’s requirements regarding students maintaining 
satisfactory academic progress— 
‘‘(A) to such students before the students 
begin classes at the institution through a de-
tailed communication that may be separate 
from a financial aid offer; and 
‘‘(B) on the financial aid webpage of the 
website of the institution. 
‘‘(6) CONSUMER TESTING.—The Secretary— 
‘‘(A) shall conduct consumer testing to de-
velop exemplary practices and templates— 
‘‘(i) to support institutions of higher 
education in carrying out paragraph (5); 
and 
‘‘(ii) which shall be available as re-
sources for institutions of higher edu-
cation; and 
‘‘(B) shall not require the use of such 
practices and templates by institutions of high-
er education.’’. 
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SEC. 106. FEDERAL PELL GRANTS FOR GRADUATE STU-
DENTS. 
Section 401 of the Higher Education Act of 1965 (20 
U.S.C. 1070a), as amended by title VII of division FF 
of the FAFSA Simplification Act (Public Law 116–260), 
is amended— 
(1) in subsection (b)(8)(A), by inserting ‘‘or as 
a postbaccalaureate student in accordance with sub-
section (d)(1)’’ after ‘‘as an undergraduate’’; and 
(2) in subsection (d)— 
(A) by amending paragraph (1) to read as 
follows: 
‘‘(1) IN GENERAL.—The period during which a 
student may receive Federal Pell Grants shall be the 
period required for the completion of the first under-
graduate baccalaureate course of study being pur-
sued by that student at the institution at which the 
student is in attendance except that— 
‘‘(A) any 1-year period during which the 
student is enrolled in a noncredit or remedial 
course of study as defined in paragraph (2) 
shall not be counted for the purpose of this 
paragraph; and 
‘‘(B) the period during which a student 
may receive Federal Pell Grants shall also in-
clude the period required for the completion of 
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the first postbaccalaureate course of study in a 
case in which— 
‘‘(i) the student received a Federal 
Pell Grant during the period required for 
the completion of the student’s first under-
graduate baccalaureate course of study for 
at least 1 but fewer than 18 semesters, or 
the equivalent of at least 1 but fewer than 
18 semesters, as determined under para-
graph (5); 
‘‘(ii) the student would otherwise be 
eligible for a Federal Pell Grant, but for 
the completion of such baccalaureate 
course of study; and 
‘‘(iii) the period during which the stu-
dent receives Federal Pell Grants does not 
exceed the student’s duration limits under 
paragraph (5).’’; and 
(B) in paragraph (2), by striking ‘‘or cer-
tificate’’ and inserting ‘‘, certificate, or first 
postbaccalaureate degree’’. 
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TITLE 
II—AMENDMENTS 
TO 
TERMS AND CONDITIONS OF 
LOANS 
AND 
REPAYMENT 
PLANS 
PART A—DIRECT LOANS 
SEC. 201. SUBSIDIZED LOANS FOR GRADUATE AND PROFES-
SIONAL STUDENTS. 
Section 455(a)(3) of the Higher Education Act of 
1965 (20 U.S.C. 1087e(a)(3)) is amended— 
(1) in subparagraph (A), in the matter pre-
ceding clause (i), by striking ‘‘subparagraph (B)’’ 
and inserting ‘‘subparagraphs (B) and (C)’’; and 
(2) by adding at the end the following: 
‘‘(C) AUTHORITY TO MAKE INTEREST SUB-
SIDIZED
LOANS
TO
GRADUATE
AND
PROFES-
SIONAL STUDENTS.—For any period of instruc-
tion at an institution of higher education (as 
defined in section 101 or section 102(a)(1)(C), 
except that a graduate medical school, nursing 
school, or a veterinary school, located outside 
the United States that does not meet the re-
quirements of section 101(a)(4) shall be ex-
cluded) beginning on or after July 1, 2024, a 
graduate or professional student shall be eligi-
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ble to receive a Federal Direct Stafford loan 
under this part.’’. 
SEC. 202. REPEAL OF ORIGINATION FEES. 
Section 455(c)(2) of the Higher Education Act of 
1965 (20 U.S.C. 1087e(c)(2)) is amended— 
(1) by striking ‘‘and’’ at the end of subpara-
graph (D); and 
(2) by adding at the end the following: 
‘‘(E) by substituting ‘0.0 percent’ for ‘4.0 
percent’ with respect to loans for which the first 
disbursement of principal is made on or after 
July 1, 2024.’’. 
SEC. 203. PREPAYMENT AMOUNTS. 
Section 455(d) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(d)) is amended by adding at the end 
the following: 
‘‘(6) 
APPLICATION
OF
PREPAYMENT 
AMOUNTS.— 
‘‘(A) REQUIREMENT FOR ELIGIBLE BOR-
ROWERS.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of this subsection or 
any other provision of law— 
‘‘(I) with respect to loans made 
to an eligible borrower under this part 
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or part B, which are held by the same 
holder and which have different appli-
cable rates of interest, the holder of 
such loans shall, unless otherwise re-
quested by the borrower in writing, 
apply 
the 
borrower’s 
prepayment 
amount (within the meaning of sec-
tion 682.209(b) of title 34, Code of 
Federal Regulations, or a successor 
regulation) for one or more of such 
loans, first toward the outstanding 
balance of principal due on the loan 
with the highest applicable rate of in-
terest among such loans; and 
‘‘(II) except as provided in sub-
clause (I), with respect to loans made 
to an eligible borrower under this part 
or part B, which are held by the same 
holder and which have the same appli-
cable rates of interest, the holder of 
such loans shall, unless otherwise re-
quested by the borrower in writing, 
apply 
the 
borrower’s 
prepayment 
amount (within the meaning of sec-
tion 682.209(b) of title 34, Code of 
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Federal Regulations, or a successor 
regulation) for one or more of such 
loans, first toward the outstanding 
balance of principal due on the loan 
with the highest principal balance 
among such loans. 
‘‘(ii) 
ELIGIBLE
BORROWER
DE-
FINED.—For purposes of this paragraph, 
the term ‘eligible borrower’ means a bor-
rower with no outstanding balance of fees, 
including collection costs and authorized 
late charges, due on any loan made under 
this part or part B. 
‘‘(B) REQUIREMENT
FOR
OTHER
BOR-
ROWERS.—A prepayment amount (as described 
in subparagraph (A)(i)) made by a borrower 
who is not an eligible borrower to a holder shall 
be applied first toward the borrower’s out-
standing balance of fees, including collection 
costs and authorized late charges, due on any 
loan made under this part or part B held by 
such holder.’’. 
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PART B—AUTOMATIC ENROLLMENT IN INCOME- 
DRIVEN REPAYMENT FOR CERTAIN BORROWERS 
SEC. 211. NOTIFICATION AND AUTOMATIC ENROLLMENT 
PROCEDURES FOR BORROWERS WHO ARE 
DELINQUENT ON LOANS. 
Section 455(d) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(d)), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(9) NOTIFICATION AND AUTOMATIC ENROLL-
MENT PROCEDURES FOR BORROWERS WHO ARE DE-
LINQUENT ON LOANS.— 
‘‘(A) AUTHORITY TO OBTAIN INCOME IN-
FORMATION.—The Secretary shall establish and 
implement, with respect to any borrower de-
scribed in subparagraph (B), procedures to— 
‘‘(i) use return information of the bor-
rower (and the borrower’s spouse, if appli-
cable) disclosed under section 6103(l)(13) 
of the Internal Revenue Code of 1986, pur-
suant to approval provided under section 
494, to determine the income and family 
size of the borrower (and the borrower’s 
spouse, if applicable) without further ac-
tion by the borrower; 
‘‘(ii) allow the borrower (or the spouse 
of the borrower), at any time, to opt out 
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of 
disclosure 
under 
such 
section 
6103(l)(13) and instead provide such infor-
mation as the Secretary may require to de-
termine the income and family size of the 
borrower (and the borrower’s spouse, if ap-
plicable); and 
‘‘(iii) provide the borrower with an op-
portunity to update the return information 
so disclosed before the determination of the 
income and family size of the borrower for 
purposes of this paragraph. 
‘‘(B) BORROWER NOTIFICATION.—With re-
spect to each borrower of a covered loan who is 
at least 31 days delinquent on such loan and 
who has not been subject to the procedures 
under this paragraph for such loan in the pre-
ceding 62 days, the Secretary shall, as soon as 
practicable after such 31-day delinquency, pro-
vide to the borrower the following: 
‘‘(i) Notification that the borrower is 
at least 31 days delinquent on at least 1 
covered loan, and a description of all delin-
quent covered loans, nondelinquent covered 
loans, and noncovered loans of the bor-
rower. 
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‘‘(ii) A brief description of the repay-
ment plans for which the borrower is eligi-
ble and the covered loans and noncovered 
loans of the borrower that may be eligible 
for such plans, based on information avail-
able to the Secretary. 
‘‘(iii) The amount of monthly pay-
ments for the covered and noncovered 
loans under each repayment plan identified 
under clause (ii), based on information 
available to the Secretary, including, if the 
income information of the borrower is 
available to the Secretary under subpara-
graph (A), the income, family size, tax fil-
ing status, and tax year information on 
which each such monthly payment is 
based. 
‘‘(iv) Clear and simple instructions on 
how to select the repayment plans. 
‘‘(v) An explanation that, in the case 
of a borrower for whom adjusted gross in-
come is unavailable— 
‘‘(I) if the borrower selects to 
repay the covered loans of such bor-
rower pursuant to an income-driven 
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repayment plan that defines discre-
tionary income in such a manner that 
an individual not required under sec-
tion 6012(a)(1) of the Internal Rev-
enue Code of 1986 to file a return 
with respect to income taxes imposed 
by subtitle A of such Code may have 
a calculated monthly payment greater 
than $0, the borrower will be required 
to provide the Secretary with other 
documentation of income satisfactory 
to the Secretary, which documentation 
the Secretary may use to determine 
an appropriate repayment schedule; 
and 
‘‘(II) if the borrower selects to 
repay such loans pursuant to an in-
come-driven repayment plan that is 
not described in subclause (I), the 
borrower will not be required to pro-
vide the Secretary with such other 
documentation of income, and the bor-
rower will have a calculated monthly 
payment of $0. 
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‘‘(vi) An explanation that the Sec-
retary shall take the actions under sub-
paragraph (C) with respect to such bor-
rower, if— 
‘‘(I) the borrower is 80 days de-
linquent on 1 or more covered loans 
and has not selected a new repayment 
plan for the covered loans of the bor-
rower; and 
‘‘(II) in the case of such a bor-
rower whose existing repayment plan 
for the covered loans of the borrower 
is not an income-driven repayment 
plan, the monthly payments under 
such existing repayment plan are 
higher than such monthly payments 
would be under an income-driven re-
payment plan. 
‘‘(vii) Instructions on updating the in-
formation of the borrower obtained under 
subparagraph (A). 
‘‘(C) 
SECRETARY’S
SELECTION
OF
A 
PLAN.—With respect to each borrower de-
scribed in subparagraph (B) whose existing re-
payment plan for the covered loans of the bor-
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rower is described in clause (vi)(II) of subpara-
graph (B), and who has not selected a new re-
payment plan for such loans in accordance with 
the notice received under such subparagraph 
and who is at least 80 days delinquent on such 
a loan, the Secretary shall, as soon as prac-
ticable— 
‘‘(i) in a case in which any of the bor-
rower’s covered loans are eligible for an in-
come-driven repayment plan— 
‘‘(I)(aa) provide the borrower 
with the income-driven repayment 
plan that requires the lowest monthly 
payment amount for each covered loan 
of the borrower, compared to any 
other such plan for which the bor-
rower is eligible; or 
‘‘(bb) if more than one income- 
driven repayment plan would offer the 
borrower the same lowest monthly 
payment amount, provide the bor-
rower with the income-driven repay-
ment plan that has the most favorable 
terms for the borrower; 
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‘‘(II) if the plan selected under 
subclause (I) is not the income-driven 
repayment plan that would have the 
lowest monthly payment amount if the 
borrower were eligible for such plan 
for the borrower’s covered loans and 
noncovered loans, notify the borrower 
of the actions, if any, the borrower 
may take to become eligible for such 
income-driven repayment plan; and 
‘‘(III) authorize the borrower to 
change the Secretary’s selection of a 
plan under this clause to any plan de-
scribed in paragraph (1) for which the 
borrower is eligible; and 
‘‘(ii) in a case in which none of the 
borrower’s covered loans are eligible for an 
income-driven repayment plan, notify the 
borrower of the actions, if any, the bor-
rower may take for such loans to become 
eligible for such a plan.’’. 
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SEC. 212. NOTIFICATION AND AUTOMATIC ENROLLMENT 
PROCEDURES FOR BORROWERS WHO ARE 
REHABILITATING DEFAULTED LOANS. 
Section 455(d) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(d)), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(10) NOTIFICATION AND AUTOMATIC ENROLL-
MENT PROCEDURES FOR BORROWERS WHO ARE RE-
HABILITATING DEFAULTED LOANS.— 
‘‘(A) AUTHORITY TO OBTAIN INCOME IN-
FORMATION.—The Secretary shall establish and 
implement, with respect to any borrower who is 
rehabilitating a covered loan pursuant to sec-
tion 428F(a), procedures to— 
‘‘(i) use return information of the bor-
rower (and the borrower’s spouse, if appli-
cable) disclosed section 6103(l)(13) of the 
Internal Revenue Code of 1986, pursuant 
to approval provided under section 494, to 
obtain such information as is reasonably 
necessary regarding the income and family 
size of the borrower (and the borrower’s 
spouse, if applicable); 
‘‘(ii) allow the borrower (or the spouse 
of the borrower), at any time, to opt out 
of 
disclosure 
under 
such 
section 
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6103(l)(13) and instead provide such infor-
mation as the Secretary may require to ob-
tain such information; and 
‘‘(iii) provide the borrower with an op-
portunity to update the return information 
so disclosed before the determination of in-
come and family size of the borrower (and 
the borrower’s spouse, if applicable) for 
purposes of this paragraph. 
‘‘(B) 
BORROWER
NOTIFICATION.—Not 
later than 30 days after a borrower makes the 
6th payment required on such covered loan for 
the loan rehabilitation described in subpara-
graph (A), the Secretary shall notify the bor-
rower of the process under subparagraph (C) 
with respect to such loan. 
‘‘(C) SECRETARY’S SELECTION OF PLAN.— 
With respect to each borrower who has made 
the 9th payment required on such covered loan 
for the loan rehabilitation described in subpara-
graph (A), the Secretary shall, as soon as prac-
ticable after such payment, carry out the proce-
dures described in clauses (i) and (ii) of para-
graph (9)(C) with respect to such loan.’’. 
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SEC. 213. COVERED LOAN, INCOME-DRIVEN REPAYMENT 
PLAN, AND NON-COVERED LOAN DEFINED. 
Section 455(d) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(d)), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(11) DEFINITIONS.—In this subsection: 
‘‘(A) COVERED LOAN.—The term ‘covered 
loan’ means— 
‘‘(i) a loan made under this part; 
‘‘(ii) a loan purchased under section 
459A; or 
‘‘(iii) a loan that has been assigned to 
the Secretary under subsection (c)(8) or 
(j)(3)(B) of section 428, or subsection 
(a)(1)(A)(ii) or (a)(1)(G) of section 428F. 
‘‘(B) 
INCOME-DRIVEN
REPAYMENT 
PLAN.—The term ‘income-driven repayment 
plan’ means a repayment plan described in sub-
paragraph (D) or (E) of paragraph (1). 
‘‘(C) 
NONCOVERED
LOAN.—The 
term 
‘noncovered loan’ means a loan made, insured, 
or guaranteed under this title that is not a cov-
ered loan.’’. 
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SEC. 214. AUTOMATIC RECERTIFICATION OF INCOME FOR 
INCOME-DRIVEN REPAYMENT PLANS. 
(a) INCOME-CONTINGENT REPAYMENT PLANS.—Sec-
tion 455(e)(8)(A) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(e)(8)(A)) is amended— 
(1) by striking ‘‘and’’ at the end of clause (ii); 
(2) by redesignating clause (iii) as clause (iv); 
(3) in clause (iv) (as so redesignated), by strik-
ing the period at the end and inserting ‘‘; and’’; and 
(4) by inserting after clause (ii), the following: 
‘‘(iii) in the case of a borrower who 
has selected to repay a loan made under 
this part pursuant to an income contingent 
repayment plan that defines discretionary 
income in such a manner that the borrower 
would have a calculated monthly payment 
equal to $0, not require the borrower to 
provide the Secretary the information de-
scribed in clause (i) or (ii), and ensure that 
the borrower will have a calculated month-
ly payment of $0; and’’. 
(b) INCOME-BASED REPAYMENT PLANS.—Section 
493C(c)(2)(B) of the Higher Education Act of 1965 (20 
U.S.C. 1098e(c)(2)(B)) is amended by striking ‘‘any loan 
made under part D (other than an excepted PLUS loan 
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