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)]
<DOC>
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.''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Education and the Workforce.
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