text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Unshackling Students to Lead, Excel, 
  Act, Develop, and Serve Act of 2012'' or the ``U.S. LEADS Act''.
  
  SEC. 2. FINDINGS.
  
      Congress finds the following:
              (1) Outstanding student loan debt will reach one trillion 
          dollars this year.
              (2) In 2008, two-thirds of students graduating with a 
          bachelor's degree had outstanding student loan debt.
              (3) In 2010, the average debt owed by college graduates 
          paying off student loans was $24,000.
              (4) Of all students who graduated with a 4-year degree in 
          2009, only 55.6 percent are working in jobs that require a 
          college degree.
              (5) Of all students who graduated with a 4-year degree in 
          2009, 22.4 percent are not working.
              (6) The median student loan debt for students who graduated 
          from college between 2006 and 2010 is $20,000.
              (7) Average in-State tuition and fees at public 4-year 
          institutions of higher education have risen 8.3 percent between 
          the 2010-2011 and 2011-2012 academic years.
  
  SEC. 3. INTEREST-FREE DEFERMENT DURING PERIODS WHEN THE NATIONAL 
                UNEMPLOYMENT RATE EXCEEDS 7 PERCENT.
  
      (a) FFEL Subsidized Loan Deferment.--Section 428(b)(1)(M) of the 
  Higher Education Act of 1965 (20 U.S.C. 1078(b)(1)(M)) is amended--
              (1) by striking ``or'' at the end of clause (iii);
              (2) by adding ``or'' at the end of clause (iv); and
              (3) by adding at the end the following new clause:
                              ``(v) in a case of a borrower who is 
                          between the ages of 21 and 25, inclusive, and a 
                          recent college student, as defined in section 
                          455(f)(5), with respect to loans made under 
                          this section to such borrower for a period of 
                          enrollment during which the borrower was 
                          pursuing a degree described in subparagraph (A) 
                          of such section 455(f)(5)--
                                      ``(I) beginning as soon as 
                                  practicable after the last day of the 
                                  second consecutive month for which the 
                                  Bureau of Labor Statistics of the 
                                  Department of Labor (in this paragraph 
                                  referred to as the `Bureau') publishes 
                                  a national unemployment rate that 
                                  exceeds 7 percent, and ending as soon 
                                  as practicable after the Bureau 
                                  publishes a national unemployment rate 
                                  that is 7 percent or lower, except that 
                                  such period shall not exceed 5 years; 
                                  or
                                      ``(II) beginning as soon as 
                                  practicable after the last day of the 
                                  second consecutive month for which the 
                                  Bureau publishes a national 
                                  unemployment rate for individuals ages 
                                  21 through 25 years old that exceeds 9 
                                  percent, and ending as soon as 
                                  practicable after the Bureau publishes 
                                  a national unemployment rate for such 
                                  individuals that is 9 percent or lower, 
                                  except that such period shall not 
                                  exceed 5 years.''.
      (b) Treatment of Consolidation Loans.--Section 428C(b)(4)(C)(ii) of 
  the Higher Education Act of 1965 (20 U.S.C. 1078-3(b)(4)(C)(ii)) is 
  amended--
              (1) by striking ``or'' at the end of subclause (II);
              (2) by redesignating subclause (III) as subclause (IV);
              (3) by inserting after subclause (II) the following:
                                      ``(III) in the case of a borrower 
                                  who is between the ages of 21 and 25, 
                                  inclusive, and a recent college 
                                  student, as defined in section 
                                  455(f)(5), by the Secretary, in the 
                                  case of a consolidation loan made to 
                                  the borrower for a period of enrollment 
                                  during which the borrower was pursuing 
                                  a degree described in subparagraph (A) 
                                  of such section 455(f)(5) and for which 
                                  the application is received on or after 
                                  the date of enactment of the U.S. Leads 
                                  Act, except that in the case of a 
                                  deferral under clause (ii) of section 
                                  428(b)(1)(M), the Secretary shall pay 
                                  such interest only for a period not in 
                                  excess of 3 years for which a borrower 
                                  would be eligible for such a deferral 
                                  and, in the case of a deferral under 
                                  clause (v) of such section, for a 
                                  period not in excess of 5 years for 
                                  which the borrower would be eligible 
                                  for such a deferral; or''; and
              (4) in subclause (IV) (as so redesignated by this 
          subsection), by striking ``(I) or (II)'' and inserting ``(I), 
          (II), or (III)''.
      (c) FFEL Unsubsidized Loan Deferment.--
              (1) In general.--Section 428H(e)(2) of the Higher Education 
          Act of 1965 (20 U.S.C. 1078-8(e)(2)) is amended--
                      (A) in subparagraph (A), by inserting ``Except as 
                  provided in subparagraph (C)'' before ``Interest on''; 
                  and
                      (B) by adding at the end the following new 
                  subparagraph:
                      ``(C) In the case of a borrower who is between the 
                  ages of 21 and 25, inclusive, and a recent college 
                  student, as defined in section 455(f)(5), interest on 
                  loans made under this section to the borrower for a 
                  period of enrollment during which the borrower was 
                  pursuing a degree described in subparagraph (A) of such 
                  section 455(f)(5) and for which payments are deferred--
                              ``(i) under clause (i), (iii), or (iv) of 
                          section 428(b)(1)(M), for a period of deferment 
                          granted to such borrower on or after the date 
                          of enactment of the U.S. Leads Act, shall 
                          accrue and be paid by the Secretary during any 
                          period during which the loans are so deferred;
                              ``(ii) under clause (ii) of section 
                          428(b)(1)(M), for a period of deferment granted 
                          to such borrower on or after the date of 
                          enactment of the U.S. Leads Act, shall accrue 
                          and be paid by the Secretary during any period 
                          during which the loans are so deferred, not in 
                          excess of 3 years; and
                              ``(iii) under clause (v) of section 
                          428(b)(1)(M), for a period of deferment granted 
                          to such borrower on or after the date of 
                          enactment of the U.S. Leads Act, shall accrue 
                          and be paid by the Secretary during any period 
                          during which the loans are so deferred, not in 
                          excess of 5 years.''.
              (2) Conforming amendment.--Section 428(b)(1)(Y)(iii) of the 
          Higher Education Act of 1965 (20 U.S.C. 1078(b)(1)(Y)(iii)) is 
          amended by inserting ``(other than a deferment under such 
          subparagraph granted to a borrower described in section 
          428H(e)(2)(C) on or after the date of enactment of the U.S. 
          Leads Act)'' after ``of this paragraph''.
      (d) Direct Loan Deferment.--Section 455(f) of the Higher Education 
  Act of 1965 (20 U.S.C. 1087(f)) is amended--
              (1) in paragraph (1)--
                      (A) in subparagraph (A)--
                              (i) by striking ``or'' at the end of clause 
                          (i); and
                              (ii) by adding at the end the following:
                              ``(iii) Federal Direct Unsubsidized 
                          Stafford Loan or Federal Direct Consolidation 
                          Loan made to a borrower for a period of 
                          enrollment during which the borrower was 
                          pursuing a degree described in paragraph (5)(A) 
                          and the borrower is between the ages of 21 and 
                          25, inclusive, and a recent college student, as 
                          defined in paragraph (5); or''; and
                      (B) in subparagraph (B)--
                              (i) by inserting ``not described in 
                          subparagraph (A)(iii)'' after ``Unsubsidized 
                          Stafford Loan''; and
                              (ii) by striking ``subparagraph (A)(ii)'' 
                          and inserting ``clause (ii) or (iii) of 
                          subparagraph (A)'';
              (2) in paragraph (2)--
                      (A) by striking ``or'' at the end of subparagraph 
                  (C);
                      (B) by striking the period at the end of 
                  subparagraph (D) and inserting ``; or''; and
                      (C) by adding at the end the following new 
                  subparagraph:
                      ``(E) in a case of a borrower who is between the 
                  ages of 21 and 25, inclusive, and a recent college 
                  student, as defined in paragraph (5), with respect to 
                  loans made under this part to such borrower for a 
                  period of enrollment during which the borrower was 
                  pursuing a degree described in subparagraph (A) of such 
                  paragraph (5)--
                              ``(i) beginning as soon as practicable 
                          after the last day of the second consecutive 
                          month for which the Bureau of Labor Statistics 
                          of the Department of Labor (in this paragraph 
                          referred to as the `Bureau') publishes a 
                          national unemployment rate that exceeds 7 
                          percent, and ending as soon as practicable 
                          after the Bureau publishes a national 
                          unemployment rate that is 7 percent or lower, 
                          except that such period shall not exceed 5 
                          years; or
                              ``(ii) beginning as soon as practicable 
                          after the last day of the second consecutive 
                          month for which the Bureau publishes a national 
                          unemployment rate for individuals ages 21 
                          through 25 years old that exceeds 9 percent, 
                          and ending as soon as practicable after the 
                          Bureau publishes a national unemployment rate 
                          for such individuals that is 9 percent or 
                          lower, except that such period shall not exceed 
                          5 years.''; and
              (3) by adding at the end the following new paragraph:
              ``(5) Definition of recent college student.--For the 
          purpose of this subsection, the term `recent college student' 
          means a borrower who--
                      ``(A) who has received a baccalaureate degree from 
                  an institution of higher education within 48 months 
                  prior to the date of enactment of the U.S. Leads Act; 
                  and
                      ``(B) who has not previously received any such 
                  baccalaureate degree.''.
target: Unshackling Students to Lead, Excel, Act, Develop, and Serve Act of 2012 or U.S. LEADS Act - Amends title IV (Student Assistance) of the Higher Education Act of 1965 to allow recent college graduates to defer payment on their student loans under the Federal Family Education Loan (FFEL) and Direct Loan (DL) programs without accruing interest when the national unemployment rate exceeds 7% or the unemployment rate for 21-25 year olds exceeds 9%.
  
  Limits that deferral period to a maximum of five years.
  
  Makes the deferral available only to graduates aged 21-25 who received their first baccalaureate degree within the four years preceding this Act's enactment.
feat_title: To provide interest-free deferment on unsubsidized student loans made to recent college students during periods when the national unemployment rate is above 7 percent and other periods of deferment.