CONSOLIDATION OF PROGRAMS.

SEC. 4047. CONSOLIDATION OF PROGRAMS. (a) In General.— Section 428H of the Act (20 U.S.C. 1078–9) is amended— (1) in the matter preceding paragraph (1) of subsection (b), by inserting “(including graduate and professional students as defined in regulations promulgated by the Secretary)” after “484”; (2) by amending subsection (d) to read as follows: “(d) Loan Limits.— “(1) In general.— Except as provided in paragraphs (2) and (3), the annual and aggregate limits for loans under this section shall be the same as those established under section 428(b)(1), less any amount received by such student pursuant to the subsidized loan program established under section 428. “(2) Annual limits for independent, graduate, and professional students.— The maximum annual amount of loans under this section an independent student (or a student whose parents are unable to borrow under section 428B or the Federal Direct PLUS Loan Program) may borrow in any academic year or its equivalent or in any period of 7 consecutive months, whichever is longer, shall be the amount determined under paragraph (1), plus— “(A) in the case of such a student attending an eligible institution who has not completed such student’s first 2 years of undergraduate study— “(i) $4,000, if such student is enrolled in a program whose length is at least one academic year in length (as determined under section 481); “(ii) $2,500, if such student is enrolled in a program whose length is less than one academic year, but at least ⅔ of such an academic year; and “(iii) $1,500, if such student is enrolled in a program whose length is less than ⅔, but at least ⅓, of such an academic year; “(B) in the case of such a student attending an eligible institution who has completed the first 2 years of undergraduate study but who has not completed the remainder of a program of undergraduate study— “(i) $5,000, if such student is enrolled in a program whose length is at least one academic year in length (as determined under section 481); “(ii) $3,325, if such student is enrolled in a program whose length is less than one academic year, but at least ⅓ of such an academic year; and “(iii) $1,675, if such student is enrolled in a program whose length is less than ⅓, but at least ⅓, of such an academic year; and “(C) in the case of such a student who is a graduate or professional student attending an eligible institution, $10,000. 107 STAT. 364 “(3) Aggregate limits for independent, graduate, and professional students.— The maximum aggregate amount of loans under this section a student described in paragraph (2) may borrow shall be the amount described in paragraph (1), adjusted to reflect the increased annual limits described in paragraph (2), as prescribed by the Secretary by regulation.”; and (3) in subsection (e), by adding at the end the following new paragraphs: “(5) Amortization.— The amount of the periodic payment and the repayment schedule for any loan made pursuant to this section shall be established by assuming an interest rate equal to the applicable rate of interest at the time the repayment of the principal amount of the loan commences. At the option of the lender, the note or other written evidence of the loan may require that— “(A) the amount of the periodic payment will be adjusted annually; or “(B) the period of repayment of principal will be lengthened or shortened, in order to reflect adjustments in interest rates occurring as a consequence of section 427A(c)(4). “(6) Repayment period.— For purposes of calculating the 10-year repayment period under section 428(b)(1)(D), such period shall commence at the time the first payment of principal is due from the borrower.”. (b) Repeal.— Section 428A of the Act is repealed. (c) Terms, Conditions and Benefits.— Notwithstanding the amendments made by this section, with respect to loans provided under sections 428A and 428H of the Act (as such sections existed on the date preceding the date of enactment of this Act) the terms, conditions and benefits applicable to such loans under such sections shall continue to apply to such loans after the date of enactment of this Act. (d) Effective Date.— Except as otherwise provided herein, the amendments made by this section shall take effect on July 1, 1994.