standard repayment plan or schedule de-
scribed in clause (i)— 
‘‘(I) during any deferment period 
described in clause (i) or (ii) of sec-
tion 455(f)(2)(A) or during any period 
of deferment under subparagraph (A) 
or (B) of section 460A(b)(1); and 
‘‘(II) during any forbearance pe-
riod while serving in a medical or den-
tal internship or residency program as 
described in section 428(c)(3)(A)(i)(I) 
or 
subparagraph 
(F) 
of 
section 
460A(b)(1); 
‘‘(7) in repaying under paragraph (6) the out-
standing balance of principal and interest due on a 
loan made under part B to a borrower who meets 
the requirements of paragraph (6), the Secretary 
shall— 
‘‘(A) enter into an agreement with the 
holder of such loan (or, if the holder acts as an 
eligible lender trustee for the beneficial owner 
of the loan, the beneficial owner of the loan) for 
the purpose of assuming the repayment obliga-
tions of the borrower in accordance with sub-
paragraph (B), except that the Secretary shall 
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kjohnson on DSK79L0C42PROD with BILLS
not assign to the United States the right to 
such loan; 
‘‘(B) assume the obligation of the borrower 
to repay the holder of such loan (or, if the hold-
er acts as an eligible lender trustee for the ben-
eficial owner of the loan, the beneficial owner of 
the loan) the total amount of principal and in-
terest remaining to be repaid on such loan 
(after taking into account the amounts repaid 
by the borrower pursuant to paragraph (6) and 
the Secretary under subsection (c), if applica-
ble) according to the terms and conditions, in-
cluding the repayment schedule, that were in ef-
fect with respect to such loan on the day before 
the Secretary assumes such obligation; and 
‘‘(C) ensure that the holder of such loan 
(or, if the holder acts as an eligible lender 
trustee for the beneficial owner of the loan, the 
beneficial owner of the loan) shall, upon enter-
ing into an agreement described in subpara-
graph (A) with respect to a loan of a borrower, 
reports to consumer reporting agencies that the 
borrower’s liability on such loan has been dis-
charged; 
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kjohnson on DSK79L0C42PROD with BILLS
‘‘(8) a borrower who is repaying a loan pursu-
ant to income-driven repayment under paragraph (1) 
may elect, at any time, to terminate repayment pur-
suant to such income-driven repayment assistance 
and repay such loan under the standard repayment 
plan under section 455(d)(6)(A)(i); 
‘‘(9) in the case of a borrower who, as of the 
date before the date of enactment of the FAIR Act, 
was repaying any loan made, insured, or guaranteed 
under part B or D (other than an excepted PLUS 
loan or excepted consolidation loan) pursuant to an 
income-based repayment plan described in section 
493C or an income-contingent repayment plan de-
scribed in section 455(d)(1)(D), which has a term or 
condition (including a term or condition related to 
loan forgiveness or cancellation, required monthly 
payments, or interest subsidies) that is more favor-
able for such borrower than a similar term or condi-
tion under the income-driven repayment assistance 
plan under paragraph (1), the Secretary shall apply 
the more favorable term or condition to the income- 
driven repayment assistance plan under paragraph 
(1) pursuant to which the borrower is repaying such 
loan, in lieu of the similar, less favorable term or 
condition; and 
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‘‘(10) the special allowance payment to a lender 
calculated under section 438, when calculated for a 
loan in repayment under this section, shall be cal-
culated on the principal balance of the loan and on 
any accrued interest unpaid by the borrower in ac-
cordance with this section. 
‘‘(b) ELIGIBILITY DETERMINATIONS AND NOTIFICA-
TION REQUIREMENT.—The Secretary shall establish and 
implement with respect to any borrower who is (or will 
be) repaying a loan pursuant to income-driven repayment 
assistance under this section, procedures to— 
‘‘(1) enroll into such income-driven repayment 
assistance plan, any borrower who, as of the date be-
fore the date of enactment of the FAIR Act, was re-
paying a loan pursuant to an income-based repay-
ment plan described in section 493C or an income- 
contingent repayment plan described in section 
455(d)(1)(D), without further action from the bor-
rower, other than any action related to compliance 
with the recertification requirements applicable to 
the borrower under section 494(a)(4)(B); 
‘‘(2) notify the borrower of the terms and con-
ditions of such plan; 
‘‘(3) use return information disclosed under sec-
tion 6103(l)(13) of the Internal Revenue Code of 
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1986, pursuant to approval provided under section 
494, to determine the repayment obligation of the 
borrower without further action by the borrower; 
‘‘(4) allow the borrower (or the spouse of the 
borrower), at any time, to opt out of disclosure 
under such section 6103(l)(13) and instead provide 
such information as the Secretary may require to de-
termine the repayment obligation of the borrower (or 
withdraw from the repayment plan under this sec-
tion); and 
‘‘(5) provide the borrower with an opportunity 
to update the return information so disclosed before 
the determination of the repayment obligation of the 
borrower. 
‘‘(c) REPAYMENT
ASSISTANCE
FOR
DISTRESSED 
BORROWERS.— 
‘‘(1) EXCESSIVE INTEREST.—For each month 
for which a borrower’s aggregate monthly payment 
under this section is insufficient to pay the total 
amount of interest that accrues on a loan for the 
month, the amount of interest accrued and not paid 
for the month shall be subtracted from the total 
amount of interest due on such loan for the month. 
‘‘(2) REPAYMENT
CREDIT.—For each month 
for which a borrower’s aggregate monthly payment 
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under this section repays an amount due on an indi-
vidual loan that is less than twice the total amount 
of interest that accrues on such loan for the month, 
the amount of the total principal due on such loan 
shall be reduced by an amount equal to half of the 
monthly payment under this section on such loan for 
the month. 
‘‘(3) APPLICATION TO BORROWERS WITH CER-
TAIN ADJUSTED GROSS INCOMES.—With respect to 
any borrower whose adjusted gross income exceeds 
300 percent of the poverty line applicable to the bor-
rower’s family size as determined under section 
673(2) of the Community Services Block Grant Act 
(42 U.S.C. 9902(2)), paragraph (1) or (2) may only 
apply to such borrower for any month in which the 
borrower’s aggregate monthly payment under this 
section is equal to or greater than the amount ob-
tained by applying subsection (e)(2) by substituting 
‘15 percent’ for ‘10 percent’ with respect to such 
borrower. 
‘‘(d) PROHIBITION.—In carrying out the require-
ments of subsection (a)(7), the Secretary may not— 
‘‘(1) revoke the rights to a special allowance 
under section 438 of the holder (or, if the holder 
acts as an eligible lender trustee for the beneficial 
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