Fair Access to Higher Education Act of 1979

Fair Access to Higher Education Act of 1979 - Amends the Higher Education Act of 1965 to replace the fixed $2,500 per school year limitation with one based on increasing amounts per school year for: (1) individual undergraduate Federal loan insurance; (2) State and institution subsidy interest payments for such loans; and (3) undergraduate supplemental loan insurance guarantees. Increases from $7,500 to $11,500 (for undergraduate students), and from $15,000 to $18,000 (for graduate students) the maximum aggregate insured unpaid amounts for: (1) individual Federal loan insurance; (2) State and institution subsidy interest payments for such loans; and (3) supplemental loan insurance guarantees.

Provides that an eligible lender (other than an eligible institution) may elect to have such federally-insured school loans collected by the Secretary of the Treasury. Provides that a borrower of such a loan may elect to have it repaid to the Secretary or Commissioner of Education on an income contingent method as defined by this Act. Stipulates that election of any such repayment or collection method must be made by the beginning of the repayment period. Requires the Commissioner of Education to notify the other party when such a collection or repayment choice has been made. Provides that such an eligible lender holding a loan where the borrower has elected the income contingent method of repayment may elect to collect such loan rather than the Federal Government.

Directs the Commissioner to make an agreement with an eligible lender holding specified elected loans which provide that: (1) the lender shall transmit to the Commissioner all information necessary to collect such loan; (2) the Commissioner shall make periodic loan payments to the lender; and (3) the Commissioner shall be bound by the terms of the lender-borrower agreement. Prohibits any such agreement to be made unless the lender provides assurances of non-discrimination.

Sets forth: (1) the duties of the Commissioner and the Secretary with regard to elected collection and repayment procedures; (2) the monthly payment amounts to be made by the Commissioner to a lender; and (3) the repayment formulas for student borrowers. Provides that a student borrower not required to file an income tax return for a particular year shall not be required to make any repayments for that year.

Requires an employer to deduct and withhold amounts from the wages of an employee-borrower who elects to have such loan repaid by the income contingent method and have such amounts deducted and withheld. Provides penalties for an employer failing to make such required deductions and withholdings.

Requires the Secretary to notify a student borrower when such loan has been repaid.

Establishes in the Treasury of the United States a Guaranteed Student Loan Fund to be used for making payments to eligible lenders who have agreements with the Commissioner, and for making refunds to borrowers as provided for by this Act.

Provides that a lender or borrower making a collection or repayment election may have such loan procedures administered alternatively by specified State or private nonprofit institutions. Defines "State marketing association" for purposes of this Act to mean such institutions or private corporations sponsored by them making or purchasing such student loans. Authorizes such associations to extend the operations of the Student Loan Marketing Association by providing secondary marketing facilities for student loans. Sets forth guidelines and requirements concerning such associations. Authorizes such associations to: (1) consolidate such student loans; and (2) establish facilities for centralized lender referrals and loan services. Directs the Commissioner to make prepayments to such associations meeting certain requirements, including: (1) developing and distributing a uniform statewide loan application form; (2) maintaining a list of eligible lenders of additional loans; and (3) making limited direct loans of last resort (as defined by this Act).

Provides deductions from amounts owed to the Commissioner by such associations which: (1) establish secondary marketing facilities; (2) provide for loan consolidation; (3) provide centralized facilities for lender referral and service; and (4) make limited direct loans.

Requires agreements evidencing federally-insured loans and Federal interest subsidies on such loans to provide for student prepayment discounts. Provides that such interest payments shall be deferred, rather than paid by the Federal Government as presently provided for. Stipulates that any such deferred interest shall be accrued to the loan's principal. Redefines "eligible lender" for the purpose of authorizing multiple disbursements with regard to such Federal interest payments.

Directs the Commissioner, in the case of a defaulting student borrower, to immediately pay such amount to an insured beneficiary who has certified his compliance with all Federal default regulations. Requires the Commissioner to report such default to a commercial credit bureau approved by the Student Loan Marketing Association.

Revises certain provisions concerning computation and payment of special allowances.

Requires agreements evidencing federally-insured student loans and Federal interest subsidies on such loans to include provisions describing lender and borrower election of repayment and collection methods as provided for by this Act.

Amends the Internal Revenue Code to authorize the Secretary to disclose tax return information to State or private nonprofit loan institutions regarding student borrowers.