1.Private Education Loan
RefinancingTitle IV of the
Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) is amended by adding at
the end the following:
JPrivate Education
Loan Refinancing
499A.Private
education loan refinancing for physicians
(a)
(1)The
Secretary shall carry out a Physician Private Education Loan Refinancing
Program in accordance with this section.
(2)There are hereby made available, in accordance with the
provisions of this section, such sums as may be necessary to make loans under
this section through refinancing private education loans to all individuals
eligible to receive refinancing under this section.
(3)In this section, the term private education
loan has the meaning given the term qualified education
loan in section 221 of the Internal Revenue Code, but does not include
any loan made under this title or under the Public Health Service Act.
(b)An individual shall be eligible to receive private
education loan refinancing under this section if the individual meets the
following requirements:
(1)The individual is participating in a
residency program, approved by the Accreditation Council for Graduate Medical
Education or the American Osteopathic Association, at a hospital in one of the
following specialties:
(A)Family
medicine.
(B)Obstetrics/gynecology.
(C)General internal
medicine.
(D)Gerontology.
(E)General
pediatrics.
(F)General
psychiatry.
(2)The individual is
not enrolled, on a half-time or more basis, in an eligible institution under
this title (as such term is defined in section 435(a)).
(3)The individual is
indebted on at least 1 private education loan for the period of enrollment
preceding their residency program.
(4)The individual is
not in default on a loan made, insured, or guaranteed under this title.
(5)The individual has
not previously obtained refinancing under this section.
(c)Refinancing
Under the Physician Private Education Loan Refinancing Program
(1)The Secretary shall refinance a private education loan in
accordance with this section for an individual who is eligible for private
education loan refinancing pursuant to subsection (b). Such refinancing loans
shall have the same terms and conditions as a Federal Direct Consolidation
Loan, except as provided in paragraphs (4) and (5).
(2)Types of loans
eligible to be refinancedA private education loan is eligible to
be refinanced under this section if the loan was incurred after July 1, 2008.
(3)The maximum amount of private education loans that may be
refinanced by an individual under this section is an amount equal to the sum of
unpaid principal, accrued interest, and late charges of all private education
loans eligible under paragraph (2) incurred by such individual.
(4)The interest rate for a private education loan refinanced
under this section shall be 8.25 percent.
(5)A loan refinanced under this section shall have the same
repayment terms, conditions, and benefits as a Federal Direct Consolidation
Loan, except that such loan shall not be eligible for—
(A)consolidation with
any other loan eligible for loan consolidation under this title;
(B)income-based
repayment terms under this title; or
(C)any loan
forgiveness or cancellation provided under this title or under the Public
Health Service Act, except in the case of death or permanent and total
disability.
(6)Loan application
and promissory noteThe Secretary shall develop and distribute a
standard application and promissory note and loan disclosure form for loans
refinanced under this section.
(7)The proceeds of any loan refinanced under this
section shall be paid by the Secretary directly to the holder of the private
education loan being refinanced for the purpose of discharging or reducing the
debt on such private education loan on behalf of the borrower, subject to
repayment terms under this section.
(d)Annual report to
congressThe Secretary shall report to Congress annually on the
volume and repayment status of private education loans refinanced under this
section.
.