National Student Loan Reform Act

National Student Loan Reform Act - Declares the purpose of this Act to be to: (1) ensure capital availability for student loans by strengthening the campus-based direct loan program; (2) adjust repayment schedules, and otherwise improve collection procedures, to make repayment sensitive to ability to repay and to reduce the default rate; and (3) guarantee loans to eligible borrowers so as to facilitate providing the expected family contributions (or, in the case of independent students, the expected self-help contribution) to the cost of higher education.

Amends the Higher Education Act of 1965 to direct the Student Loan Marketing Association to enter into agreements with eligible institutions for making low-interest loans to student directly through such institutions. Sets forth the terms of such agreement.

Stipulates that: (1) the conditions of such loans shall be determined by the institution, subject to any requirements or limitations prescribed by the Association; (2) the amount of such loans shall equal the cost of attendance minus any scholarships or other loans, the expected family income or self-help contribution, and any other Federal assistance; (3) such loans will be made to accepted or attending students in financial need who are carrying at least one-half the normal academic workload; and (4) such loans shall be evidenced by a written agreement. Stipulates with regard to repayment that: (1) the repayment period shall begin nine months after a student graduates or ceases to carry the required workload, and continue for a maximum of 15 years; (2) repayment may be in either equal or graduated installments at the option of the student borrower; (3) payments may be accelerated or paid in full without penalty; (4) the interest rate shall be seven percent; (5) no security or endorsement shall be required unless the student borrower is a minor; (6) the loan shall be cancelled upon the death or permanent total disability of the student borrower; (7) no repayment shall be required while the borrower is in school, or for up to three years while in the Armed Forces, Peace Corps, or a volunteer under the Domestic Volunteer Act of 1972; (8) repayment extensions may be made; and (9) partial loan cancellation shall be made for certain teaching positions and combat veterans.

Establishes a loan program guaranteed by the Association to meet the cost of the expected family contribution under this Act. Authorizes necessary appropriations to the student loan insurance fund for such loans and related expenses. Transfers such fund's availability from the Commissioner of Education to the Association. Provides that the Association shall pay an eligible institution ten dollars per academic years for each enrolled student on whose behalf such family-contribution loan is made. Limits such new family-contribution loan to fiscal years 1981-1985, and prohibits any payment for existing loans after September 30, 1989.

Stipulates with regard to such family-contribution loans: (1) the institution must certify to the lender the amount of the expected family contribution; (2) such loans shall be 100 percent insured; (3) the student must have been accepted, or already enrolled, as at least a half-time basis; (4) such loans will be made without security and without endorsement; (5) repayment shall begin no more than nine months after graduation or after the student ceases to be at least a half-time student, and shall be over a period of not less than five nor more than ten years; (6) principal need not be paid (but interest shall accrue) if the student is enrolled at least half-time (including graduate school), in a rehabilitation training program, or unable to find (for up to 12 months) full time employment; (7) interest, at a rate of one percent less than the Treasury rate, shall accrue and be paid during the term of the loan, except that such interest may be deferred until repayment of the principal starts; and (8) payments may be accelerated without penalty.

Provides that, upon application by an eligible lender, the Association shall issue certificates of insurance covering the loan and setting forth the amount and terms of the insurance. Authorizes the Association to issue to a lender a certificate of comprehensive coverage to cover all qualifying loans made by such lender within a specified cutoff date and up to a specified aggregate maximum.

Sets forth lender recovery procedures for any such defaulting borrowers.

Provides that the Association shall repay the loans of bankrupt, diseased, or disabled borrowers.

Revises provisions regarding special allowance payments to lenders to: (1) change the formula for computing such allowance; and (2) extend the five percent limit on such allowance from October 1, 1977, to October 1, 1980.

Eliminates the provision providing for a District of Columbia student loan insurance program.

Authorizes Federal credit unions to make family-contribution loans to eligible borrowers.

Terminates existing lending programs (Guaranteed Student Loan Program and the National Direct Student Loan Program) six months after the enactment of this Act.

Provides for the dissolution of the existing Student Loan Marketing Association and the assumption, and expansion, of such Association's functions by a newly created Association. Includes within such new Association's functions: (1) the authority to continue to purchase, sell, collect or otherwise deal in specified existing student loan programs; and (2) the authority to contract with State guaranty agencies (and compensate them for services) for collecting student loans, distributing loan funds to institutions, monitoring and auditing student loan programs, and providing technical assistance and information regarding such loans.

Authorizes the Association to issue notes, bonds, or other obligations with the concurrence of the Secretary of the Treasury. Provides that the obligations of the Association shall constitute general obligations of the United States.