Title: Help Students Repay Act
Policy area: Education

Summary:
Help Students Repay Act
This bill directs the Department of Education to consolidate student loan repayment options for new borrowers of William D. Ford Federal Direct Loans into one simplified income-driven repayment plan.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4372 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 4372

To amend the Higher Education Act of 1965 to require borrowers to repay 
    Federal student loans under an income-based repayment plan or a 
           standard repayments plan, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 13, 2017

 Mr. Ferguson (for himself, Mr. Mitchell, and Mr. Garrett) introduced 
 the following bill; which was referred to the Committee on Education 
                           and the Workforce

_______________________________________________________________________

                                 A BILL


 
To amend the Higher Education Act of 1965 to require borrowers to repay 
    Federal student loans under an income-based repayment plan or a 
           standard repayments plan, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Help Students Repay Act''.

SEC. 2. STREAMLINING REPAYMENT PLANS FOR NEW BORROWERS.

    Section 455 of the Higher Education Act of 1965 (20 U.S.C. 1087e) 
is amended by striking subsection (d) and inserting the following:
    ``(d) Repayment Plans.--
            ``(1) Design and selection for borrowers before july 1, 
        2018.--With respect to a borrower of a loan made under this 
        part before July 1, 2018, and consistent with criteria 
        established by the Secretary, the Secretary shall offer such 
        borrower a variety of plans for repayment of such loan, 
        including principal and interest on the loan. The borrower 
        shall be entitled to accelerate, without penalty, repayment on 
        the borrower's loans under this part. The borrower may choose--
                    ``(A) a standard repayment plan, consistent with 
                subsection (a)(1) of this section and with section 
                428(b)(9)(A)(i);
                    ``(B) a graduated repayment plan, consistent with 
                section 428(b)(9)(A)(ii);
                    ``(C) an extended repayment plan, consistent with 
                section 428(b)(9)(A)(iv), except that the borrower 
                shall annually repay a minimum amount determined by the 
                Secretary in accordance with section 428(b)(1)(L);
                    ``(D) an income contingent repayment plan, with 
                varying annual repayment amounts based on the income of 
                the borrower, paid over an extended period of time 
                prescribed by the Secretary, not to exceed 25 years, 
                except that the plan described in this subparagraph 
                shall not be available to the borrower of a Federal 
                Direct PLUS loan made on behalf of a dependent student; 
                and
                    ``(E) an income-based repayment plan that enables 
                borrowers who have a partial financial hardship to make 
                a lower monthly payment in accordance with section 
                493C, except that the plan described in this 
                subparagraph shall not be available to the borrower of 
                a Federal Direct PLUS Loan made on behalf of a 
                dependent student or a Federal Direct Consolidation 
                Loan, if the proceeds of such loan were used to 
                discharge the liability on such Federal Direct PLUS 
                Loan or a loan under section 428B made on behalf of a 
                dependent student.
            ``(2) Design and selection for borrowers on or after july 
        1, 2018.--The Secretary shall offer a borrower of a loan made 
        under this part on or after July 1, 2018, the following plans 
        for repayment of such loan, including principal and interest on 
        the loan. The borrower shall be entitled to accelerate, without 
        penalty, repayment on the borrower's loans under this part. The 
        borrower may choose--
                    ``(A) a standard repayment plan, consistent with 
                subsection (a)(1) of this section and with section 
                428(b)(9)(A)(i); or
                    ``(B) an income-based repayment plan, consistent 
                with section 460A, except the plan described in this 
                subparagraph shall not be available to a borrower of a 
                Federal Direct PLUS Loan made on behalf of a dependent 
                student, a Federal Direct Consolidation Loan, if the 
                proceeds of such loan were used to discharge the 
                liability on such Federal Direct PLUS Loan or a loan 
                under section 428B made on behalf of a dependent 
                student.
            ``(3) Borrower non-selection.--If a borrower of a loan made 
        under this part does not select a repayment plan described in 
        paragraph (1) or (2), the Secretary may provide the borrower 
        with a repayment plan described in subparagraph (A), (B), or 
        (C) of paragraph (1) in the case of a borrower of a loan first 
        disbursed before July 1, 2018, or a repayment plan described in 
        paragraph (2)(A) in the case of a borrower of a loans first 
        disbursed on or after July 1, 2018.
            ``(4) Changes in selections.--The borrower of a loan made 
        under this part may change the borrower's selection of a 
        repayment plan under paragraph (1) or (2), or the Secretary's 
        selection of a plan for the borrower under paragraph (3), as 
        the case may be, under such terms and conditions as may be 
        established by the Secretary.
            ``(5) Repayment after default.--For any borrower who has 
        defaulted on a loan made under this part, the Secretary--
                    ``(A) may require the borrower to pay all 
                reasonable collection costs associated with such loan; 
                and
                    ``(B) if such loan was made--
                            ``(i) to any borrower who, before July 1, 
                        2018, had an outstanding balance on a student 
                        loan made, insured, or guaranteed under this 
                        part or part B, may require the borrower to 
                        repay the loan pursuant to an income contingent 
                        repayment plan, as described in paragraph 
                        (1)(D), or an income-based repayment plan, as 
                        described in paragraph (1)(E); or
                            ``(ii) to a new borrower (as defined in 
                        section 460A(a)(2)), may provide the borrower 
                        the option to enroll in the repayment plan 
                        described in paragraph (2)(B).
            ``(6) Applicability provision.--
                    ``(A) In general.--Except as provided in paragraph 
                (5) and subparagraph (B), the repayment plans under 
                subparagraphs (B), (C), (D), and (E) of paragraph (1) 
                are not available for a borrower who received the 
                borrower's first disbursement of a Federal Direct Loan 
                on or after July 1, 2018.
                    ``(B) Exception.--The repayment plans available to 
                a borrower of a Federal Direct PLUS Loan made on behalf 
                of a dependent student or a Federal Direct 
                Consolidation Loan whose proceeds were used to 
                discharge the liability of a Federal Direct PLUS Loan 
                made on behalf of a dependent student or a loan under 
                section 428B made on behalf of a dependent student on 
                or after July 1, 2018, shall be those described under 
                subparagraphs (A), (B), and (C) of paragraph (1).''.

SEC. 3. INCOME-BASED REPAYMENT FOR NEW BORROWERS AND NEW 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. INCOME-BASED REPAYMENT PLAN.

    ``(a) Definitions.--
            ``(1) Covered federal direct loan.--The term `covered 
        Federal Direct Loan' means a Federal Direct Stafford Loan, a 
        Federal Direct Unsubsidized Stafford Loan, a Federal Direct 
        Consolidation Loan (other than an excepted consolidation loan), 
        or a Federal Direct PLUS Loan (other than an excepted plus 
        loan) made under this part.
            ``(2) New borrower.--The term `new borrower' means a 
        borrower who--
                    ``(A) as of July 1, 2018, has no outstanding 
                balance on a student loan made, insured, or guaranteed 
                under part B or D; or
                    ``(B) has no outstanding balance on a student loan 
                made, insured, or guaranteed under part B or D on the 
                date the borrower receives a loan made under part D on 
                or after July 1, 2018.
            ``(3) Excepted plus loan; excepted consolidation loan.--The 
        terms `excepted plus loan' and `excepted consolidation loan' 
        have the meanings given such terms in section 493C.
            ``(4) Income-based calculation.--The term `income-based 
        calculation' means 15 percent of the result obtained by 
        calculating, on at least an annual basis, the amount by which--
                    ``(A) the borrower's, and the borrower's spouse's 
                (if applicable), adjusted gross income; exceeds, as 
                defined by the Secretary; exceeds
                    ``(B) 150 percent of the poverty line applicable to 
                the borrower's family size as determined under section 
                673(2) of the Community Services Block Grant Act (42 
                U.S.C. 9902(2)).
    ``(b) Revised Income-Based Plan.--Notwithstanding any other 
provision of this Act, the Secretary shall carry out a program for new 
borrowers and any borrowers of covered Federal Direct Loans made on or 
after July 1, 2018, that meets the following requirements:
            ``(1) Monthly payment amount.--Except as otherwise provided 
        in this subsection, a new borrower of any covered Federal 
        Direct Loan, or any borrower of any covered Federal Direct 
        Loan, may elect to have the borrower's aggregate monthly 
        payment for all such loans not to exceed the result of the 
        income-based calculation divided by 12.
            ``(2) Application of payment.--The Secretary shall apply 
        the borrower's monthly payment under this subsection on such a 
        loan first toward interest due on the loan, next toward any 
        fees due on the loan, and then toward the principal of the 
        loan.
            ``(3) Interest.--
                    ``(A) In general.--Subject to subparagraph (B), if 
                the borrower's monthly payment amount under paragraph 
                (1) is not sufficient to pay the accrued interest on 
                the borrower's loan, such interest shall be paid by the 
                borrower or be capitalized.
                    ``(B) No accrual of interest after 10 years.--
                Notwithstanding section 455(b)(8) or any other 
                provision of this title, interest shall cease accruing 
                on a loan being repaid under this subsection, after the 
                borrower has made payments under this subsection on 
                such loan in an amount equal to--
                            ``(i) the amount the borrower would have 
                        repaid under 455(d)(1)(A) on such loan, based 
                        on a 10-year repayment period, when the 
                        borrower first made the election described in 
                        this subsection, plus
                            ``(ii) the amount of any interest that 
                        accrued (or was capitalized) during a 
                        forbearance or deferment period or any similar 
                        period, on the portion of the loan that was 
                        being repaid in accordance with clause (i).
            ``(4) Selection of different repayment plan.--A borrower 
        who no longer wishes to repay under the plan under this section 
        may change to a standard repayment plan in accordance with 
        section 455(d)(3).
    ``(c) Eligibility Determinations.--The Secretary shall establish 
procedures for annually determining the borrower's eligibility for 
income-based repayment, including verification of a borrower's annual 
income and the annual amount due on the total amount of covered Federal 
Direct Loans, and such other procedures as are necessary to effectively 
implement income-based repayment under this section. The Secretary 
shall consider, but is not limited to, the procedures established in 
accordance with section 455(e)(1) or section 493C, or in connection 
with income sensitive repayment schedules under section 
428(b)(9)(A)(iii) or 428C(b)(1)(E).
    ``(d) Special Rule for Married Borrowers Filing Separately.--In the 
case of a married borrower who files a separate Federal income tax 
return, the Secretary shall calculate the amount of the borrower's 
income-based repayment under this section solely on the basis of the 
borrower's student loan debt and adjusted gross income.''.
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