Page:United States Statutes at Large Volume 112 Part 2.djvu/806

From Wikisource
Jump to: navigation, search
This page needs to be proofread.

112 STAT. 1690 PUBLIC LAW 105-244 —OCT. 7, 1998 (h) DEFAULT AVERSION ASSISTANCE.— Subsection (1) of section 20 USC 1078. 428 is amended to read as follows: "(1) DEFAULT AVERSION ASSISTANCE.— " (1) ASSISTANCE REQUIRED. —Upon receipt of a complete request from a lender received not earlier than the 60th day of delinquency, a guaranty agency having an agreement with the Secretary under subsection (c) shall engage in default aversion activities designed to prevent the default by a borrower on a loan covered by such sigreement. "(2) REIMBURSEMENT.— "(A) IN GENERAL.— A guaranty agency, in accordance with the provisions of this paragraph, may transfer from the Federal Student Loan Reserve Fund under section 422A to the Agency Operating Fund under section 422B a default aversion fee. Such fee shall be paid for any loan on which a claim for default has not been paid as a result of the loan being brought into current repayment status by the guaranty agency on or before the 300th day after the loan becomes 60 days delinquent. "(B) AMOUNT. —The default aversion fee shall be equal to 1 percent of the total unpaid principal and accrued interest on the loan at the time the request is submitted by the lender. A guaranty agency may transfer such fees earned under this subsection not more frequently than monthly. Such a fee shall not be paid more than once on any loan for which the guareinty agency averts the default unless— "(i) at least 18 months has elapsed between the date the borrower entered current repayment status and the date the lender filed a subsequent default aversion assistance request; and "(ii) during the period between such dates, the borrower was not more than 30 days past due on any payment of principal and interest on the loan. "(C) DEFINITION. —For the purpose of earning the default aversion fee, the term 'current repayment status' means that the borrower is not delinquent in the payment of any principal or interest on the loan.", (i) INCOME CONTINGENT REPAYMENT.— Section 428(m) is amended by striking "shall require at least 10 percent of the borrowers" and inserting "may require borrowers". (j) STATE SHARE OF DEFAULT COSTS. — Subsection (n) of section 428 is repealed. (k) BLANKET CERTIFICATE OF GUARANTY. —Section 428 is amended by adding at the end the following: "(n) BLANKET CERTIFICATE OF LOAN GUARANTY.— "(1) IN GENERAL.— Subject to paragraph (3), any guaranty agency that has entered into or enters into any insurance program agreement with the Secretary under this part may— "(A) offer eligible lenders participating in the agency^s gu£u*anty program a blanket certificate of loan guaranty that permits the lender to make loans without receiving prior approval from the guaranty agency of individual loans for eligible borrowers enrolled in eligible progrsims at eligible institutions; and "(B) provide eligible lenders with the ability to transmit electronically data to the agency concerning loans the