student loans

student loans Sec. 105. (a) Authorization Level.—Subsection (a) of section 742 (42 U.S.C. 294b(a)) is amended to read as follows: “Sec. 742. (a) For the purpose of— “(1) making Federal capital contributions into the loan funds of schools which have established loan funds under this part. “(2) making payments into the fund established by section 744(d), and “(3) making transfers under section 746, there are authorized to be appropriated $50,000,000 for the fiscal year ending June 30, 1972, $55,000,000 for the fiscal year ending June 30, 1973, and $60,000,000 for the fiscal year ending June 30, 1974. For the fiscal year ending June 30, 1975, and each of the two succeeding fiscal years there are authorized to be appropriated to the Secretary such sums as may be necessary to enable students who have received a loan under this part for any academic year ending before July 1, 1974, to continue or complete their education.” (b) Loan Repayment and Forgiveness.— (1) Section 741(f) (42 U.S.C. 294a(f)) is amended to read as follows: “(f) (1) In the case of any individual— “(A) who has received a degree of doctor of medicine, doctor of osteopathy, doctor of dentistry or an equivalent degree, doctor of veterinary medicine or an equivalent degree, doctor of optometry or an equivalent degree, bachelor of science in pharmacy or an equivalent degree, or doctor of podiatry or an equivalent degree; “(B) who obtained (i) one or more loans from a loan fund established under this part, or (ii) any other educational loan for his costs at a school of medicine, osteopathy, dentistry, veterinary medicine, optometry, pharmacy, or podiatry; and “(C) who enters into an agreement with the Secretary to practice his profession for a period of at least two years in an area in a State determined by the Secretary, after consultation with the appropriate State health authority (as determined by the Secretary by regulations), to have a shortage of and need for persons trained in his profession; the Secretary shall make payments in accordance with paragraph 2, for and on behalf of that individual, on the principal of and interest on any loan of his described in subparagraph (B) of this paragraph which is outstanding on the date he begins the practice specified in the agreement described in subparagraph (C) of this paragraph. “(2) The payments described in paragraph (1) shall be made by the Secretary as follows: “(A) Upon completion by the individual for whom the payments are to be made of the first year of the practice specified in the agreement he entered into with the Secretary under paragraph (1), the Secretary shall pay 30 per centum of the principal 85 Stat. 450of, and the interest on each loan of such individual described in paragraph (1)(B) which is outstanding on the date he began such practice. “(B) Upon completion by that individual of the second year of such practice, the Secretary shall pay another 30 per centum of the principal of, and the interest on each such loan. “(C) Upon completion by that individual of a third year of such practice, the Secretary shall pay another 25 per centum of the principal of, and the interest on each such loan. “(3) Notwithstanding the requirement of completion of practice specified in paragraph (2), the Secretary shall, on or before the due date thereof, pay any loan or loan installment which may fall due within the period of practice for which the borrower may receive payments under this subsection, upon the declaration of such borrower, at such times and in such manner as the Secretary may prescribe (and supported by such other evidence as the Secretary may reasonably require), that the borrower is then engaged as described by paragraph (1) or (2)(C), and that he will continue to be so engaged for the period required (in the absence of this paragraph) to entitle him to have made the payments provided by this subsection for such period; except that not more than 85 per centum of the principal of any such loan shall be paid pursuant to this paragraph. “(4) A borrower who fails to fulfill an agreement with the Secretary entered into under paragraph (1) shall be liable to reimburse the Secretary for any payments made pursuant to paragraph (2) (A) or paragraph (3) in consideration of such agreement. “(5) Notwithstanding the amendment made by section 105(b)(1) of the Comprehensive Health Manpower Training Act of 1971 to this subsection— “(A) any person who obtained one or more loans from a loan fund established under this part, who before the date of the enactment of such Act became eligible for cancellation of all or part of such loans (including accrued interest) under this subsection (as in effect on the day before such date), and who on such date was not engaged in a practice for which loan cancellation was authorized under this subsection (as so in effect), may at any time elect to receive such cancellation in accordance with this subsection (as so in effect); and “(B) in the case of any person who obtained one or more loans from a loan fund established under this part and who on such date was engaged in a practice for which cancellation of all or part of such loans (including accrued interest) was authorized under this subsection (as so in effect), this subsection (as so in effect) shall continue to apply to such person for purposes of providing such loan cancellation until he terminates such practice. “Nothing in this paragraph shall be construed to prevent any person from entering into an agreement for loan cancellation under this subsection (as amended by section 105(b)(1) of such Act).” (2) Section 741 of such Act is amended by adding at the end thereof the following new subsection: “(l) upon application by a person who received, and is under an obligation to repay, any loan made to such person as a health professions student to enable him to study medicine, osteopathy, dentistry, veterinary medicine, optometry, pharmacy, or podiatry, the Secretary may undertake to repay (without liability to the applicant) all or any part of such loan, and any interest or portion thereof outstanding thereon, upon his determination, pursuant to regulations establishing criteria therefor, that the applicant— 85 Stat. 451 “(1) failed to complete such studies leading to his first professional degree; “(2) is in exceptionally needy circumstances; “(3) is from a low-income or disadvantaged family as those terms may be defined by such regulations; and “(4) has not resumed, or cannot reasonably be expected to resume, the study of medicine, osteopathy, dentistry, veterinary medicine, optometry, pharmacy, or podiatry, within two years following the date upon which he terminated such studies.” (c) Loan Ceiling.—Section 741(a) (42U.S.C. 294a(a)) is amended (1) by striking out “$2,500” and inserting in lieu thereof “$3,500”, and (2) by striking out the second sentence. (d) Repayment After Training.—Section 741(c) (2) (42 U.S.C. 294a(c) (2)) is amended by striking out “(up to five years)”. (e) Technical Amendments.— (1) Section 740(b) (4) (42 U.S.C. 294(b) (4)) is amended by striking out “1971” and inserting in lieu thereof “1974”. (2) Section 743 (42 U.S.C. 294c) is amended by striking out “1975” each place it occurs and inserting in lieu thereof “1977”. (3) Section 744(a) (1) (42 U.S.C. 294d(a) (1)) is amended by striking out “four fiscal years” and inserting in lieu thereof “six fiscal years”. (4) Sections 740(b)(4) and 741(b) (42 U.S.C. 294(b)(4), 294a(b)) are each amended (A) by striking out “doctor of pharmacy” and inserting in lieu thereof “an equivalent degree”, and (B) by striking out “doctor of surgical chiropody” and inserting in lieu thereof “an equivalent degree”. (f) Loans for Study Abroad.— (1) Part C of title VII is amended by inserting immediately below the heading to such part the following: “Subpart I—Loans to Students Studying in the United States” (2) Such part C is amended by striking out “this part” each place it occurs and inserting in lieu thereof “this subpart”. (3) Section 781 (42 U.S.C. 295f) is amended by striking out “part C” and inserting in lieu thereof “subpart I of part C”. (4) Such part C is further amended by adding after section 746 the following: “Subpart II—Student Loans by the Secretary to Citizens of the United States Who Are Full-Time Students in Schools of Medicine Located Outside the United States “student loans “Sec. 747. (a) From the amounts appropriated to carry out this subpart, the Secretary is authorized to make, in accordance with this subpart, loans to citizens of the United States who are full-time students in schools of medicine which are located outside the United States. 85 Stat. 452 “(b) Except as otherwise provided in this subpart, loans made under this subpart shall (to the extent feasible) be made on the same terms and conditions as are required with respect to loans made to students of medicine under the program established by subpart I. “(c) (1) No loan under this subpart shall be made to any student unless— “(A) prior to the date such student files application for such loan— “(i) he has made application for admission as a student in a school of medicine which is located in the United States; and “(ii) he has, in connection with the making of such application for admission to such school, undergone a written examination to determine his qualifications for admission as a student in such school; “(B) such student furnishes to the Secretary a certification from such school that— “(i) such student is qualified for admission as a student in such school, and “(ii) such student was denied admission as a student in such school solely because, for the school year for which such student applied for admission to such school, the number of qualified applicants for admission to such school exceeded the maximum number of students (as determined by such school) which such school was prepared to accept for admission for such year; and “(C) such student has not been accepted, before the date of approval of his application for a loan under this subpart, by a medical school located in the United States. “(2) No loan under this subpart shall be made to any student who has completed three years as a student in a school of medicine, unless— “(A) such student has passed an examination which— “(i) is prepared by a body or bodies which the Secretary recognizes as being qualified to prepare such an examination, and “(ii) is used to determine the qualifications of students in schools of medicine which are located outside the United States for admission (as transfer students) in schools of medicine which are located in the United States; and “(B) such student has made application for admission (as a transfer student) to, but has not been accepted by, a school of medicine which is located in the United States. “(d) To carry out this subpart there are authorized to be appropriated $1,750,000 for the fiscal year ending June 30, 1972, and for each of the next two fiscal years.”