Helping Individuals Get a Higher Education while Reducing Education Debt Act or the HIGHER ED Act
This bill makes various changes to student loan forgiveness and loan repayment programs.
First, the bill authorizes graduate and professional students to receive subsidized Stafford Loans. These students have been ineligible to receive subsidized Stafford Loans since July 1, 2012.
Next, the bill allows student loans to be discharged in bankruptcy proceedings.
The bill also establishes refinancing programs for student loans. It allows certain borrowers to refinance their federal student loans down to lower interest rates, and it creates the Federal Direct Refinanced Private Loan to allow certain borrowers to refinance their private student loans.
Additionally, the bill revises the Public Service Loan Forgiveness (PSLF) program, such as by (1) allowing certain part-time faculty to participate in the PSLF program, (2) directing the Department of Education (ED) to annually cancel 10% of the amount a borrower owes after satisfying 12 qualifying monthly payments, (3) revising the process for certification of employment, and (4) requiring ED to establish a dispute resolution process.
Further, the bill revises federal student loan repayment programs, including by (1) replacing existing student loan repayment plans with one income-based repayment plan and one standard 10-year repayment plan, and (2) allowing existing borrowers to lower their payments by switching to these new plans. It also establishes a process for ED to enroll a delinquent borrower in a new repayment plan.
The bill also requires ED to provide certain notifications to borrowers.
To amend the Higher Education Act of 1965 to improve loans, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Helping 
Individuals Get a Higher Education while Reducing Education Debt Act'' 
or the ``HIGHER ED Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
  TITLE I--REINSTATEMENT OF AUTHORITY TO MAKE FEDERAL DIRECT STAFFORD 
LOANS TO GRADUATE AND PROFESSIONAL STUDENTS; DISCHARGING STUDENT LOANS 
                             IN BANKRUPTCY

Sec. 101. Reinstatement of authority to make Federal Direct Stafford 
                            Loans to graduate and professional 
                            students.
Sec. 102. Discharge student loans in bankruptcy.
                     TITLE II--REFINANCING PROGRAMS

Sec. 201. Program authority.
Sec. 202. Refinancing program.
Sec. 203. Income-based repayment.
                      TITLE III--LOAN FORGIVENESS

Sec. 301. Loan forgiveness for adjunct faculty.
Sec. 302. Amendments to the public service loan forgiveness program.
Sec. 303. Transition to improved public service loan forgiveness 
                            program.
                TITLE IV--INCOME-DRIVEN REPAYMENT PLANS

Sec. 401. Income-based repayment plan.
Sec. 402. Termination of certain repayment plan options.
Sec. 403. Notification and automatic enrollment procedures for 
                            borrowers who are delinquent on loans.
Sec. 404. Automatic recertification for income-driven repayment plans.

  TITLE I--REINSTATEMENT OF AUTHORITY TO MAKE FEDERAL DIRECT STAFFORD 
LOANS TO GRADUATE AND PROFESSIONAL STUDENTS; DISCHARGING STUDENT LOANS 
                             IN BANKRUPTCY

SEC. 101. REINSTATEMENT OF AUTHORITY TO MAKE FEDERAL DIRECT STAFFORD 
              LOANS TO GRADUATE AND PROFESSIONAL STUDENTS.

    (a) Amendments.--Section 455(a)(3) of the Higher Education Act of 
1965 (20 U.S.C. 1087e(a)(3)) is amended--
            (1) in the paragraph heading, by inserting ``Temporary'' 
        before ``Termination''; and
            (2) in subparagraph (A), in the matter preceding clause 
        (i), by inserting ``, and ending on or before June 30, 2021'' 
        after ``2012''.
    (b) Inapplicability of Rulemaking Requirements.--Sections 482(c) 
and 492 of the Higher Education Act of 1965 (20 U.S.C. 1089(c); 1098a) 
shall not apply to the regulations under this section.

SEC. 102. DISCHARGE STUDENT LOANS IN BANKRUPTCY.

    (a) Exception To Discharge.--Section 523(a) of title 11, United 
States Code, is amended--
            (1) by striking paragraph (8); and
            (2) by redesignating paragraphs (9) through (14B) as 
        paragraphs (8) through (14A), respectively.
    (b) Conforming Amendments.--Title 11, United States Code, is 
amended--
            (1) in section 704(c)(1)(C)(iv)(I) by striking ``(14A)'' 
        and inserting ``(14)'';
            (2) in section 1106(c)(1)(C)(iv)(I) by striking ``(14A)'' 
        and inserting ``(14)'';
            (3) in section 1202(c)(1)(C)(iv)(I) by striking ``(14A)'' 
        and inserting ``(14)''; and
            (4) in section 1328(a)(2) by striking ``(8), or (9)'' and 
        inserting ``or (8)''.
    (c) Effective Date; Application of Amendments.--
            (1) Effective date.--Except as provided in subsection (b), 
        this section and the amendments made by this section shall take 
        effect on the date of the enactment of this Act.
            (2) Application of amendments.--The amendments made by this 
        section shall apply only with respect to cases commenced under 
        title 11 of the United States Code on or after the date of the 
        enactment of this Act.

                     TITLE II--REFINANCING PROGRAMS

SEC. 201. PROGRAM AUTHORITY.

    Section 451(a) of the Higher Education Act of 1965 (20 U.S.C. 
1087a(a)) is amended--
            (1) by striking ``and (2)'' and inserting ``(2)''; and
            (2) by inserting ``; and (3) to make loans under section 
        460A and section 460B'' after ``section 459A''.

SEC. 202. REFINANCING PROGRAM.

    Part D of title IV of the Higher Education Act of 1965 (20 U.S.C. 
1087a et seq.) is amended by adding at the end the following:

``SEC. 460A. REFINANCING FFEL AND FEDERAL DIRECT LOANS.

    ``(a) In General.--Beginning not later than 180 days after the date 
of enactment of the Helping Individuals Get a Higher Education while 
Reducing Education Debt Act, the Secretary shall establish a program 
under which the Secretary, upon the receipt of an application from a 
qualified borrower, makes a loan under this part, in accordance with 
the provisions of this section, in order to permit the borrower to 
obtain the interest rate provided under subsection (c).
    ``(b) Refinancing Direct Loans.--
            ``(1) Federal direct loans.--Upon application of a 
        qualified borrower, the Secretary shall repay a Federal Direct 
        Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, a 
        Federal Direct PLUS Loan, or a Federal Direct Consolidation 
        Loan of the qualified borrower, for which the first 
        disbursement was made, or the application for the consolidation 
        loan was received, before July 1, 2022, with the proceeds of a 
        refinanced Federal Direct Stafford Loan, a Federal Direct 
        Unsubsidized Stafford Loan, a Federal Direct PLUS Loan, or a 
        Federal Direct Consolidation Loan, respectively, issued to the 
        borrower in an amount equal to the sum of the unpaid principal, 
        accrued unpaid interest, and late charges of the original loan.
            ``(2) Refinancing ffel program loans as refinanced federal 
        direct loans.--Upon application of a qualified borrower for any 
        loan that was made, insured, or guaranteed under part B and for 
        which the first disbursement was made, or the application for 
        the consolidation loan was received, before July 1, 2010, the 
        Secretary shall make a loan under this part, in an amount equal 
        to the sum of the unpaid principal, accrued unpaid interest, 
        and late charges of the original loan to the borrower in 
        accordance with the following:
                    ``(A) The Secretary shall pay the proceeds of such 
                loan to the eligible lender of the loan made, insured, 
                or guaranteed under part B, in order to discharge the 
                borrower from any remaining obligation to the lender 
                with respect to the original loan.
                    ``(B) A loan made under this section that was 
                originally--
                            ``(i) a loan originally made, insured, or 
                        guaranteed under section 428 shall be a Federal 
                        Direct Stafford Loan;
                            ``(ii) a loan originally made, insured, or 
                        guaranteed under section 428B shall be a 
                        Federal Direct PLUS Loan;
                            ``(iii) a loan originally made, insured, or 
                        guaranteed under section 428H shall be a 
                        Federal Direct Unsubsidized Stafford Loan; and
                            ``(iv) a loan originally made, insured, or 
                        guaranteed under section 428C shall be a 
                        Federal Direct Consolidation Loan.
                    ``(C) The interest rate for each loan made by the 
                Secretary under this paragraph shall be the rate 
                provided under subsection (c).
    ``(c) Interest Rates.--
            ``(1) In general.--The interest rate for the refinanced 
        Federal Direct Stafford Loans, Federal Direct Unsubsidized 
        Stafford Loans, Federal Direct PLUS Loans, and Federal Direct 
        Consolidation Loans, shall be a rate equal to--
                    ``(A) in any case where the original loan was a 
                loan under section 428 or 428H, a Federal Direct 
                Stafford loan, or a Federal Direct Unsubsidized 
                Stafford Loan, that was issued to an undergraduate 
                student, a rate equal to the rate for Federal Direct 
                Stafford Loans and Federal Direct Unsubsidized Stafford 
                Loans issued to undergraduate students for the 12-month 
                period beginning on July 1, 2016, and ending on June 
                30, 2017;
                    ``(B) in any case where the original loan was a 
                loan under section 428 or 428H, a Federal Direct 
                Stafford Loan, or a Federal Direct Unsubsidized 
                Stafford Loan, that was issued to a graduate or 
                professional student, a rate equal to the rate for 
                Federal Direct Unsubsidized Stafford Loans issued to 
                graduate or professional students for the 12-month 
                period beginning on July 1, 2016, and ending on June 
                30, 2017;
                    ``(C) in any case where the original loan was a 
                loan under section 428B or a Federal Direct PLUS Loan, 
                a rate equal to the rate for Federal Direct PLUS Loans 
                for the 12-month period beginning on July 1, 2016, and 
                ending on June 30, 2017; and
                    ``(D) in any case where the original loan was a 
                loan under section 428C or a Federal Direct 
                Consolidation Loan, a rate calculated in accordance 
                with paragraph (2).
            ``(2) Interest rates for consolidation loans.--
                    ``(A) Method of calculation.--In order to determine 
                the interest rate for any refinanced Federal Direct 
                Consolidation Loan under paragraph (1)(D), the 
                Secretary shall--
                            ``(i) determine each of the component loans 
                        that were originally consolidated in the loan 
                        under section 428C or the Federal Direct 
                        Consolidation Loan, and calculate the 
                        proportion of the unpaid principal balance of 
                        the loan under section 428C or the Federal 
                        Direct Consolidation Loan that each component 
                        loan represents;
                            ``(ii) use the proportions determined in 
                        accordance with clause (i) and the interest 
                        rate applicable for each component loan, as 
                        determined under subparagraph (B), to calculate 
                        the weighted average of the interest rates on 
                        the loans consolidated into the loan under 
                        section 428C or the Federal Direct 
                        Consolidation Loan; and
                            ``(iii) apply the weighted average 
                        calculated under clause (ii) as the interest 
                        rate for the refinanced Federal Direct 
                        Consolidation Loan.
                    ``(B) Interest rates for component loans.--The 
                interest rates for the component loans of a loan made 
                under section 428C or a Federal Direct Consolidation 
                Loan shall be the following:
                            ``(i) The interest rate for any loan under 
                        section 428 or 428H, Federal Direct Stafford 
                        Loan, or Federal Direct Unsubsidized Stafford 
                        Loan issued to an undergraduate student shall 
                        be a rate equal to the lesser of--
                                    ``(I) the rate for Federal Direct 
                                Stafford Loans and Federal Direct 
                                Unsubsidized Stafford Loans issued to 
                                undergraduate students for the 12-month 
                                period beginning on July 1, 2016, and 
                                ending on June 30, 2017; or
                                    ``(II) the original interest rate 
                                of the component loan.
                            ``(ii) The interest rate for any loan under 
                        section 428 or 428H, Federal Direct Stafford 
                        Loan, or Federal Direct Unsubsidized Stafford 
                        Loan issued to a graduate or professional 
                        student shall be a rate equal to the lesser 
                        of--
                                    ``(I) the rate for Federal Direct 
                                Unsubsidized Stafford Loans issued to 
                                graduate or professional students for 
                                the 12-month period beginning on July 
                                1, 2016, and ending on June 30, 2017; 
                                or
                                    ``(II) the original interest rate 
                                of the component loan.
                            ``(iii) The interest rate for any loan 
                        under section 428B or Federal Direct PLUS Loan 
                        shall be a rate equal to the lesser of--
                                    ``(I) the rate for Federal Direct 
                                PLUS Loans for the 12-month period 
                                beginning on July 1, 2016, and ending 
                                on June 30, 2017; or
                                    ``(II) the original interest rate 
                                of the component loan.
                            ``(iv) The interest rate for any component 
                        loan that is a loan under section 428C or a 
                        Federal Direct Consolidation Loan shall be the 
                        weighted average of the interest rates that 
                        would apply under this subparagraph for each 
                        loan comprising the component consolidation 
                        loan.
                            ``(v) The interest rate for any eligible 
                        loan that is a component of a loan made under 
                        section 428C or a Federal Direct Consolidation 
                        Loan and is not described in clauses (i) 
                        through (iv) shall be the interest rate on the 
                        original component loan.
            ``(3) Fixed rate.--The applicable rate of interest 
        determined under paragraph (1) for a refinanced loan under this 
        section shall be fixed for the period of the loan.
    ``(d) Terms and Conditions of Loans.--
            ``(1) In general.--A loan that is refinanced under this 
        section shall have the same terms and conditions as the 
        original loan, except as otherwise provided in this section.
            ``(2) No automatic extension of repayment period.--
        Refinancing a loan under this section shall not result in the 
        extension of the duration of the repayment period of the loan, 
        and the borrower shall retain the same repayment term that was 
        in effect on the original loan. Nothing in this paragraph shall 
        be construed to prevent a borrower from electing a different 
        repayment plan at any time in accordance with section 
        455(d)(3).
    ``(e) Definition of Qualified Borrower.--
            ``(1) In general.--For purposes of this section, the term 
        `qualified borrower' means a borrower--
                    ``(A) of a loan under this part or part B for which 
                the first disbursement was made, or the application for 
                a consolidation loan was received, before July 1, 2021; 
                and
                    ``(B) who meets the eligibility requirements based 
                on income or debt-to-income ratio established by the 
                Secretary.
            ``(2) Income requirements.--Not later than 180 days after 
        the date of enactment of the Helping Individuals Get a Higher 
        Education while Reducing Education Debt Act, the Secretary 
        shall establish eligibility requirements based on income or 
        debt-to-income ratio that take into consideration providing 
        access to refinancing under this section for borrowers with the 
        greatest financial need.
    ``(f) Notification to Borrowers.--The Secretary, in coordination 
with the Director of the Bureau of Consumer Financial Protection, shall 
undertake a campaign to alert borrowers of loans that are eligible for 
refinancing under this section that the borrowers are eligible to apply 
for such refinancing. The campaign shall include the following 
activities:
            ``(1) Developing consumer information materials about the 
        availability of Federal student loan refinancing.
            ``(2) Requiring servicers of loans under this part or part 
        B to provide such consumer information to borrowers in a manner 
        determined appropriate by the Secretary, in consultation with 
        the Director of the Bureau of Consumer Financial Protection.

``SEC. 460B. FEDERAL DIRECT REFINANCED PRIVATE LOAN PROGRAM.

    ``(a) Definitions.--In this section:
            ``(1) Eligible private education loan.--The term `eligible 
        private education loan' means a private education loan, as 
        defined in section 140(a) of the Truth in Lending Act (15 
        U.S.C. 1650(a)), that--
                    ``(A) was disbursed to the borrower before July 1, 
                2022; and
                    ``(B) was for the borrower's own postsecondary 
                educational expenses for an eligible program at an 
                institution of higher education participating in the 
                loan program under this part, as of the date that the 
                loan was disbursed.
            ``(2) Federal direct refinanced private loan.--The term 
        `Federal Direct Refinanced Private Loan' means a loan issued 
        under subsection (b)(1).
            ``(3) Private educational lender.--The term `private 
        educational lender' has the meaning given the term in section 
        140(a) of the Truth in Lending Act (15 U.S.C. 1650(a)).
            ``(4) Qualified borrower.--The term `qualified borrower' 
        means an individual who--
                    ``(A) has an eligible private education loan;
                    ``(B) has been current on payments on the eligible 
                private education loan for the 6 months prior to the 
                date of the qualified borrower's application for 
                refinancing under this section, and is in good standing 
                on the loan at the time of such application;
                    ``(C) is not in default on the eligible private 
                education loan or on any loan made, insured, or 
                guaranteed under this part or part B or E; and
                    ``(D) meets the eligibility requirements described 
                in subsection (b)(2).
    ``(b) Program Authorized.--
            ``(1) In general.--The Secretary, in consultation with the 
        Secretary of the Treasury, shall carry out a program under 
        which the Secretary, upon application by a qualified borrower 
        who has an eligible private education loan, shall issue such 
        borrower a loan under this part in accordance with the 
        following:
                    ``(A) The loan issued under this program shall be 
                in an amount equal to the sum of the unpaid principal, 
                accrued unpaid interest, and late charges of the 
                private education loan.
                    ``(B) The Secretary shall pay the proceeds of the 
                loan issued under this program to the private 
                educational lender of the private education loan, in 
                order to discharge the qualified borrower from any 
                remaining obligation to the lender with respect to the 
                original loan.
                    ``(C) The Secretary shall require that the 
                qualified borrower undergo loan counseling that 
                provides all of the information and counseling required 
                under clauses (i) through (viii) of section 
                485(b)(1)(A) before the loan is refinanced in 
                accordance with this section, and before the proceeds 
                of such loan are paid to the private educational 
                lender.
                    ``(D) The Secretary shall issue the loan as a 
                Federal Direct Refinanced Private Loan, which shall 
                have the same terms, conditions, and benefits as a 
                Federal Direct Unsubsidized Stafford Loan, except as 
                otherwise provided in this section.
            ``(2) Borrower eligibility.--Not later than 180 days after 
        the date of enactment of the Helping Individuals Get a Higher 
        Education while Reducing Education Debt Act, the Secretary, in 
        consultation with the Secretary of the Treasury and the 
        Director of the Bureau of Consumer Financial Protection, shall 
        establish eligibility requirements--
                    ``(A) based on income or debt-to-income ratio that 
                take into consideration providing access to refinancing 
                under this section for borrowers with the greatest 
                financial need;
                    ``(B) to ensure eligibility only for borrowers in 
                good standing;
                    ``(C) to minimize inequities between Federal Direct 
                Refinanced Private Loans and other Federal student 
                loans;
                    ``(D) to preclude windfall profits for private 
                educational lenders; and
                    ``(E) to ensure full access to the program 
                authorized in this subsection for borrowers with 
                private loans who otherwise meet the criteria 
                established in accordance with subparagraphs (A) and 
                (B).
    ``(c) Interest Rate.--
            ``(1) In general.--The interest rate for a Federal Direct 
        Refinanced Private Loan is--
                    ``(A) in the case of a Federal Direct Refinanced 
                Private Loan for a private education loan originally 
                issued for undergraduate postsecondary educational 
                expenses, a rate equal to the rate for Federal Direct 
                Stafford Loans and Federal Direct Unsubsidized Stafford 
                Loans issued to undergraduate students for the 12-month 
                period beginning on July 1, 2016, and ending on June 
                30, 2017; and
                    ``(B) in the case of a Federal Direct Refinanced 
                Private Loan for a private education loan originally 
                issued for graduate or professional degree 
                postsecondary educational expenses, a rate equal to the 
                rate for Federal Direct Unsubsidized Stafford Loans 
                issued to graduate or professional students for the 12-
                month period beginning on July 1, 2016, and ending on 
                June 30, 2017.
            ``(2) Combined undergraduate and graduate study loans.--If 
        a Federal Direct Refinanced Private Loan is for a private 
        education loan originally issued for both undergraduate and 
        graduate or professional postsecondary educational expenses, 
        the interest rate shall be a rate equal to the rate for Federal 
        Direct PLUS Loans for the 12-month period beginning on July 1, 
        2016, and ending on June 30, 2017.
            ``(3) Fixed rate.--The applicable rate of interest 
        determined under this subsection for a Federal Direct 
        Refinanced Private Loan shall be fixed for the period of the 
        loan.
    ``(d) No Inclusion in Aggregate Limits.--The amount of a Federal 
Direct Refinanced Private Loan, or a Federal Direct Consolidated Loan 
to the extent such loan was used to repay a Federal Direct Refinanced 
Private Loan, shall not be included in calculating a borrower's annual 
or aggregate loan limits under section 428 or 428H.
    ``(e) No Eligibility for Service-Related Repayment.--
Notwithstanding sections 428K(a)(2)(A), 428L(b)(2), 455(m)(3)(A), and 
460(b), a Federal Direct Refinanced Private Loan, or any Federal Direct 
Consolidation Loan to the extent such loan was used to repay a Federal 
Direct Refinanced Private Loan, shall not be eligible for any loan 
repayment or loan forgiveness program under section 428K, 428L, or 460 
or for the repayment plan for public service employees under section 
455(m).
    ``(f) Private Educational Lender Reporting Requirement.--
            ``(1) Reporting required.--Not later than 180 days after 
        the date of enactment of the Helping Individuals Get a Higher 
        Education while Reducing Education Debt Act, the Secretary, in 
        consultation with the Secretary of the Treasury and the 
        Director of the Bureau of Consumer Financial Protection, shall 
        establish a requirement that private educational lenders report 
        the data described in paragraph (2) to the Secretary, to 
        Congress, to the Secretary of the Treasury, and to the Director 
        of the Bureau of Consumer Financial Protection, in order to 
        allow for an assessment of the private education loan market.
            ``(2) Contents of reporting.--The data that private 
        educational lenders shall report in accordance with paragraph 
        (1) shall include each of the following about private education 
        loans (as defined in section 140(a) of the Truth in Lending Act 
        (15 U.S.C. 1650(a))):
                    ``(A) The total amount of private education loan 
                debt the lender holds.
                    ``(B) The total number of private education loan 
                borrowers the lender serves.
                    ``(C) The average interest rate on the outstanding 
                private education loan debt held by the lender.
                    ``(D) The proportion of private education loan 
                borrowers who are in default on a loan held by the 
                lender.
                    ``(E) The proportion of the outstanding private 
                education loan volume held by the lender that is in 
                default.
                    ``(F) The proportions of outstanding private 
                education loan borrowers who are 30, 60, and 90 days 
                delinquent.
                    ``(G) The proportions of outstanding private 
                education loan volume that is 30, 60, and 90 days 
                delinquent.
    ``(g) Notification to Borrowers.--The Secretary, in coordination 
with the Secretary of the Treasury and the Director of the Bureau of 
Consumer Financial Protection, shall undertake a campaign to alert 
borrowers about the availability of private student loan refinancing 
under this section.''.

SEC. 203. INCOME-BASED REPAYMENT.

    Section 493C of the Higher Education Act of 1965 (20 U.S.C. 1098e) 
is amended by adding at the end the following:
    ``(f)  Special Rule for Refinanced Loans.--
            ``(1) Refinanced federal direct and ffel loans.--In 
        calculating the period of time during which a borrower of a 
        loan that is refinanced under section 460A has made monthly 
        payments for purposes of subsection (b)(7), the Secretary shall 
        deem the period to include all monthly payments made for the 
        original loan, and all monthly payments made for the refinanced 
        loan, that otherwise meet the requirements of this section.
            ``(2) Federal direct refinanced private loans.--In 
        calculating the period of time during which a borrower of a 
        Federal Direct Refinanced Private Loan under section 460B has 
        made monthly payments for purposes of subsection (b)(7), the 
        Secretary shall include only payments--
                    ``(A) that are made after the date of the issuance 
                of the Federal Direct Refinanced Private Loan; and
                    ``(B) that otherwise meet the requirements of this 
                section.''.

                      TITLE III--LOAN FORGIVENESS

SEC. 301. LOAN FORGIVENESS FOR ADJUNCT FACULTY.

    Section 455(m)(3)(B)(ii) of the Higher Education Act of 1965 (20 
U.S.C. 1087e(m)(3)(B)(ii)) is amended--
            (1) by striking ``teaching as'' and inserting the 
        following: ``teaching--
                                    ``(I) as'';
            (2) by striking ``, foreign language faculty, and part-time 
        faculty at community colleges), as determined by the 
        Secretary.'' and inserting ``and foreign language faculty), as 
        determined by the Secretary; or''; and
            (3) by adding at the end the following:
                                    ``(II) as a part-time faculty 
                                member or instructor who--
                                            ``(aa) teaches not less 
                                        than 1 course at an institution 
                                        of higher education (as defined 
                                        in section 101(a)), a 
                                        postsecondary vocational 
                                        institution (as defined in 
                                        section 102(c)), or a Tribal 
                                        College or University (as 
                                        defined in section 316(b)); and
                                            ``(bb) is not employed on a 
                                        full-time basis by any other 
                                        employer.''.

SEC. 302. AMENDMENTS TO THE PUBLIC SERVICE LOAN FORGIVENESS PROGRAM.

    (a) Public Service Loan Forgiveness.--
            (1) In general.--Section 455(m) of the Higher Education Act 
        of 1965 (20 U.S.C. 1087e(m)) is amended to read as follows:
    ``(m) Loan Forgiveness for Federal Student Loan Borrowers Employed 
in Public Service.--
            ``(1) Definitions.--In this subsection:
                    ``(A) Certification of employment.--The term 
                `certification of employment' means a certification of 
                employment under paragraph (4).
                    ``(B) Full-time.--The term `full-time', when used 
                with respect to employment, means employment--
                            ``(i) with a qualifying employer for not 
                        less than 30 hours per week; or
                            ``(ii) with 2 or more qualifying employers 
                        for a total of not less than 30 hours per week.
                    ``(C) Qualifying employer.--The term `qualifying 
                employer' means--
                            ``(i) a Federal, State, local, or Tribal 
                        government organization or instrumentality, 
                        including any organization established in law 
                        as a body politic;
                            ``(ii) an organization that is described in 
                        section 501(c)(3) of the Internal Revenue Code 
                        of 1986, and exempt from taxation under section 
                        501(a) of such Code;
                            ``(iii) an organization--
                                    ``(I) not described in clause (ii) 
                                that is a not-for-profit organization 
                                under other Federal or State law;
                                    ``(II) that is not a labor 
                                organization or partisan political 
                                organization; and
                                    ``(III) whose purpose is to 
                                directly provide any of the following 
                                services, as defined in regulations 
                                promulgated by the Secretary:
                                            ``(aa) Emergency management 
                                        and disaster response.
                                            ``(bb) Military service.
                                            ``(cc) Public safety 
                                        services, including fire 
                                        prevention and suppression, 
                                        rescue services, hazardous 
                                        materials response, ambulance 
                                        services, and emergency medical 
                                        services.
                                            ``(dd) Law enforcement.
                                            ``(ee) Public health, 
                                        including service through 
                                        organizations that employ 
                                        nurses, nurse practitioners, 
                                        nurses in a clinical setting, 
                                        or professionals engaged in 
                                        health care practitioner 
                                        occupations and health care 
                                        support occupations, as such 
                                        terms are defined by the Bureau 
                                        of Labor Statistics, or 
                                        organizations at which 
                                        individuals engaged in such 
                                        occupations provide service, 
                                        but who are prohibited from 
                                        being employed directly by such 
                                        an organization or other health 
                                        care facility by State law.
                                            ``(ff) Public education, 
                                        including the provision of 
                                        educational enrichment or 
                                        support directly to students or 
                                        their families, employment with 
                                        a Tribal College or University 
                                        (as defined in section 316(b)), 
                                        and employment as an adjunct 
                                        faculty member or instructor 
                                        for an educational institution.
                                            ``(gg) Public interest law 
                                        services, including prosecution 
                                        or public defense or legal 
                                        advocacy on behalf of low-
                                        income communities at a not-
                                        for-profit organization.
                                            ``(hh) Early childhood 
                                        education, including licensed 
                                        or regulated childcare, Head 
                                        Start programs, and State 
                                        funded prekindergarten.
                                            ``(ii) Public service for 
                                        individuals with disabilities.
                                            ``(jj) Public service for 
                                        the elderly.
                                            ``(kk) Public and school-
                                        based library sciences.
                                            ``(ll) School-based 
                                        services, including the 
                                        provision of noneducational 
                                        enrichment or support directly 
                                        to students or their families.
                                            ``(mm) Social work, 
                                        including child or family 
                                        services.
                                            ``(nn) Veteran or military 
                                        services organization; or
                            ``(iv) a farm or ranch that, with respect 
                        to a fiscal year, has earnings of gross revenue 
                        during such year from the sale of agricultural 
                        products equal to or greater than--
                                    ``(I) in the case of 2022, $35,000; 
                                or
                                    ``(II) in the case of any 
                                succeeding year, the amount applicable 
                                under this subparagraph for the 
                                previous year, increased by the 
                                estimated percentage change in the 
                                Consumer Price Index for the most 
                                recent year preceding such year.
                    ``(D) Qualifying monthly payment obligation.--The 
                term `qualifying monthly payment obligation' means a 
                monthly payment obligation due on a loan under the 
                repayment plan of the borrower--
                            ``(i) that was satisfied by the borrower 
                        through a payment made after October 1, 2007; 
                        and
                            ``(ii) attributable to a period during 
                        which the borrower was employed full-time by a 
                        qualifying employer.
                    ``(E) Loan made under this part.--The term `loan 
                made under this part' includes a Federal Direct 
                Stafford Loan, Federal Direct PLUS Loan, Federal Direct 
                Unsubsidized Stafford Loan, or Federal Direct 
                Consolidation Loan refinanced under section 460A.
            ``(2) Cancellation authorized.--
                    ``(A) In general.--Beginning on July 1, 2022, the 
                Secretary shall, on an annual basis, cancel an amount 
                of interest and principal due, in accordance with 
                subparagraph (B), on any loan made under this part that 
                is not in default for a borrower who--
                            ``(i) has satisfied 12 qualifying monthly 
                        payment obligations on such loan; and
                            ``(ii) submits a certification of 
                        employment that meets the requirements of 
                        paragraph (3) for the period in which the 
                        borrower makes each of the 12 payment 
                        obligations described in subparagraph (A).
                    ``(B) Cancellation amount.--The Secretary shall 
                cancel--
                            ``(i) after the conclusion of each of the 
                        first 9, 12-month periods described in 
                        subparagraph (A), an amount equal to 10 percent 
                        of the balance of interest and principal due, 
                        on the loans made to the borrower under this 
                        part, as of the date on which the borrower 
                        satisfies the first qualifying monthly payment 
                        obligation under this subsection on such loans; 
                        and
                            ``(ii) after the conclusion of the tenth, 
                        12-month period described in subparagraph (A), 
                        the obligation to repay any remaining balance 
                        of principal and interest due as of the time of 
                        such cancellation, on the loans made to the 
                        borrower under this part.
            ``(3) Certification of employment requirements.--
                    ``(A) In general.--In order to receive loan 
                cancellation under this subsection, a borrower of a 
                loan made under this part shall submit to the Secretary 
                a certification of employment.
                    ``(B) Content of certification.--The Secretary 
                shall--
                            ``(i) develop, and make easily accessible, 
                        the certification of employment; and
                            ``(ii) ensure that the method of 
                        certification--
                                    ``(I) allows for the employer to 
                                indicate and certify the dates of the 
                                borrower's employment; and
                                    ``(II) provides electronic 
                                signature options for the employer and 
                                for the borrower.
                    ``(C) Borrower access.--The Secretary shall ensure 
                that a borrower may submit a certification of 
                employment to the Secretary electronically through any 
                information system through which the Secretary permits 
                borrowers to take self-service actions with respect to 
                their loans.
                    ``(D) Exception for self-certification.--The 
                Secretary shall provide a self-certification option for 
                the certification of employment for borrowers who have 
                extenuating circumstances preventing the borrowers from 
                obtaining the qualifying employer signature and 
                certification required under subparagraph (B)(ii), as 
                determined by the Secretary pursuant to rulemaking and 
                including situations where an employer is no longer in 
                existence or refuses to cooperate.
                    ``(E) Periodic review of certification of 
                employment.--For each borrower of a loan made under 
                this part who has submitted a certification of 
                employment, the Secretary shall--
                            ``(i) by not later than 30 days after 
                        receipt of the certification of employment--
                                    ``(I) review the certification of 
                                employment and determine the number of 
                                qualifying monthly payment obligations 
                                satisfied on the loan during the period 
                                of employment covered by the 
                                certification of employment; and
                                    ``(II) inform the borrower of the 
                                number of qualifying monthly payment 
                                obligations satisfied; and
                            ``(ii) periodically, but not less than 
                        twice annually, notify the borrower, using the 
                        most recent calculation of qualifying monthly 
                        payment obligations, of--
                                    ``(I) the number of qualifying 
                                monthly payment obligations satisfied, 
                                as of the date of the notice;
                                    ``(II) any steps the borrower can 
                                take to convert non-qualifying monthly 
                                payment obligations into qualifying 
                                monthly payment obligations, including 
                                the options to provide payments to 
                                satisfy monthly payment obligations for 
                                past public service under paragraph 
                                (4)(C); and
                                    ``(III) the dispute resolution 
                                process for the Secretary's 
                                determination of qualifying monthly 
                                payment obligations, as described in 
                                paragraph (7).
            ``(4) Qualifying monthly payment obligations.--
                    ``(A) In general.--For purposes of this subsection, 
                the number of qualifying monthly payment obligations 
                satisfied on a loan is the number of monthly payments, 
                during the period of employment and based on the 
                repayment plan selected by the borrower for such 
                period, that would be satisfied based on applying the 
                total amount of payments made by the borrower on the 
                loan at any time during such period.
                    ``(B) Adjustment of payment obligation status.--
                            ``(i) Hold harmless against retroactive 
                        determinations.--If the Secretary has 
                        classified a payment obligation satisfied by a 
                        borrower of a loan made under this part as a 
                        qualifying monthly payment obligation and later 
                        determines that the payment obligation does not 
                        qualify, the Secretary shall deem the payment 
                        obligation to be a qualifying monthly payment 
                        obligation to be counted for purposes of 
                        paragraph (2).
                            ``(ii) Explanation of non-qualifying 
                        payment obligation determinations.--If the 
                        Secretary determines that payments made by a 
                        borrower of a loan made under this part for a 
                        period of full-time employment with a 
                        qualifying employer cannot be applied toward 
                        the total number of qualifying monthly payment 
                        obligations for purposes of paragraph (2), the 
                        Secretary shall provide a borrower with an 
                        explanation and allow the borrower to correct 
                        the reason for such determination, to the 
                        extent possible. Such borrower remediation 
                        shall include, at a minimum, providing a 
                        borrower with the opportunity to reimburse the 
                        Secretary for any underpayment.
                    ``(C) Satisfying previously non-qualifying monthly 
                payment obligations.--
                            ``(i) In general.--A borrower of a loan 
                        made under this part who has a period during 
                        which the borrower was employed full-time with 
                        a qualifying employer but did not satisfy one 
                        or more qualifying monthly payment obligations 
                        during such period, such as a borrower who was 
                        in deferment or forbearance, may satisfy one or 
                        more monthly payment obligations of that period 
                        at a later date by paying the additional amount 
                        needed to satisfy the qualifying monthly 
                        payment obligation, in accordance with a 
                        process established by the Secretary.
                            ``(ii) Determination process.--The amount 
                        of past monthly payment obligations satisfied 
                        by a payment under this subparagraph for a 
                        period of employment shall be determined using 
                        the amount of the borrower's monthly payment, 
                        based on any repayment plan, as selected by the 
                        borrower, that could have been selected by the 
                        borrower during such period. The Secretary may 
                        require a borrower wishing to satisfy past 
                        monthly payment obligations under this 
                        subparagraph to submit any additional 
                        information necessary to calculate the amount 
                        of the past payments.
                            ``(iii) Limit.--A borrower may not satisfy 
                        more than 36 past monthly payment obligations 
                        under this subparagraph.
                    ``(D) Overpayment.--In a case in which the dispute 
                resolution process under paragraph (8) delays the date 
                on which a borrower would have received full loan 
                forgiveness under paragraph (3)(B), the Secretary shall 
                refund the borrower the amount of any qualifying 
                monthly payment obligation the borrower makes in excess 
                of 120 qualifying payment obligations during such 
                process.
            ``(5) Special rules relating to federal direct 
        consolidation loans.--
                    ``(A) Review of any new consolidation loan 
                application.--
                            ``(i) Public service loan forgiveness 
                        option on consolidation application.--Beginning 
                        on July 1, 2022, the Secretary shall include, 
                        in any application for a Federal Direct 
                        Consolidation Loan, the option for the borrower 
                        to indicate that the borrower is consolidating 
                        for the purpose of using the public service 
                        loan forgiveness program under this subsection.
                            ``(ii) Review.--Beginning on July 1, 2022, 
                        the Secretary shall, after issuing any Federal 
                        Direct Consolidation Loan to a borrower who 
                        indicated an interest in the public service 
                        loan forgiveness program on the loan 
                        application--
                                    ``(I) request that the borrower 
                                submit a certification of employment; 
                                and
                                    ``(II) after receiving a complete 
                                certification of employment, review the 
                                borrower's past payments on all 
                                component loans comprising the Federal 
                                Direct Consolidation Loan and inform 
                                the borrower--
                                            ``(aa) of the number of 
                                        monthly payment obligations 
                                        satisfied by the borrower 
                                        before the date of 
                                        consolidation that are 
                                        qualifying monthly payment 
                                        obligations, in accordance with 
                                        subparagraph (B); or
                                            ``(bb) if no payment 
                                        obligations are satisfied, that 
                                        the borrower will not receive 
                                        any credit towards public 
                                        service loan forgiveness under 
                                        this subsection for the Federal 
                                        Direct Consolidation Loan.
                    ``(B) Qualifying payment obligations on all 
                component loans and loan types through consolidation.--
                In the case of a borrower of one or more loans eligible 
                for consolidation, including loans made under part B, 
                who applies for, and receives, a Federal Direct 
                Consolidation Loan, the Secretary shall request the 
                borrower submit a certification of employment for any 
                qualifying employment and, after receiving the 
                certification of employment, shall--
                            ``(i) review the borrower's payment history 
                        on each of the component loans comprising the 
                        Federal Direct Consolidation Loan, including 
                        each loan made under part B; and
                            ``(ii) for each component loan--
                                    ``(I) calculate the weighted factor 
                                of the component loan, which shall be 
                                the factor that represents the ratio 
                                between the amount of the component 
                                loan and the amount of the Federal 
                                Direct Consolidation Loan, as 
                                determined by the Secretary;
                                    ``(II) determine the number of 
                                equivalent monthly payment obligations 
                                toward the Federal Direct Consolidation 
                                Loan satisfied on the component loan by 
                                multiplying the weighted factor for the 
                                component loan by the number of 
                                qualifying monthly payment obligations 
                                that the borrower satisfied on the 
                                component loan; and
                                    ``(III) after rounding the number 
                                determined under subclause (II) to the 
                                nearest whole number, deem that number 
                                of equivalent monthly payment 
                                obligations to be qualifying monthly 
                                payment obligations on the Federal 
                                Direct Consolidation Loan.
                    ``(C) Applicability of borrower protections and 
                rights.--A borrower of one or more loans eligible for 
                consolidation, including loans made under part B, who 
                applies for and receives a Federal Direct Consolidation 
                Loan shall receive all the protections and rights 
                provided under subparagraphs (B) and (C) of paragraph 
                (4) for the loan, and for any component loan, in the 
                same manner as provided to any other borrower of a loan 
                made under this part.
                    ``(D) Treatment of certain consolidation loan 
                payments.--In a case in which a borrower makes a 
                qualifying monthly payment obligation for purposes of 
                paragraph (2) on a Federal Direct Consolidation Loan 
                that was used to repay a Federal Direct Stafford Loan, 
                Federal Direct PLUS Loan, Federal Direct Unsubsidized 
                Stafford Loan, or Federal Direct Consolidation Loan 
                refinanced under section 460A for which at least one 
                qualifying monthly payment obligation for such purposes 
                has been made prior to the consolidation, the 
                qualifying monthly payment obligation on such Federal 
                Direct Consolidation Loan shall be treated as a 
                qualifying monthly payment obligation for purposes of 
                paragraph (2) on such Federal Direct Stafford Loan, 
                Federal Direct PLUS Loan, Federal Direct Unsubsidized 
                Stafford Loan, or Federal Direct Consolidation Loan.
            ``(6) Notice of qualifying payment obligations.--
                    ``(A) Initial notice.--Upon receiving any verbal or 
                written contact by a borrower on or after July 1, 2022, 
                expressing interest in the public service loan 
                forgiveness program under this subsection, the 
                Secretary, or an eligible lender or guaranty agency 
                under part B, shall provide the borrower, by not later 
                than 30 days after the contract, with a notice that--
                            ``(i) explains the requirements of the 
                        program, including whether the borrower needs 
                        to consolidate some or all of the borrower's 
                        loans to receive forgiveness under this 
                        subsection;
                            ``(ii) includes a copy of, or a link to, 
                        information about the certification of 
                        employment process described in paragraph (3);
                            ``(iii) includes an estimate of the 
                        qualifying monthly payment obligations that 
                        would be satisfied by the borrower based on the 
                        borrower's payment history, as of the date of 
                        notice, if the borrower was a full-time 
                        employee of a qualifying employer and met the 
                        requirements of paragraph (2); and
                            ``(iv) includes an estimate of the number 
                        of remaining qualifying monthly payment 
                        obligations to be satisfied in order for the 
                        borrower to receive partial loan forgiveness 
                        under paragraph (2)(A).
                    ``(B) Subsequent notices.--After providing an 
                initial notice under subparagraph (A), the Secretary, 
                or an eligible lender or guaranty agency under part B, 
                shall annually provide the borrower with a notice 
                containing the information described in such 
                subparagraph for each subsequent year that the borrower 
                has an outstanding loan, unless the borrower receives 
                notices under paragraph (3)(E)(ii) or requests that the 
                notices be discontinued.
            ``(7) Dispute resolution process.--By not later than July 
        1, 2022, the Secretary shall establish a process on an online 
        portal for borrowers to dispute the calculation of qualifying 
        monthly payment obligations, or the determination of full or 
        partial loan forgiveness under paragraph (2), following the 
        submission of a certification of employment or application for 
        forgiveness or any successor certification or application.
            ``(8) Special rules for section 460a loans.--
                    ``(A) Refinanced federal direct loans.--
                Notwithstanding paragraph (2), in determining the 
                number of monthly payments that meet the requirements 
                of such paragraph for an eligible Federal Direct Loan 
                refinanced under section 460A that was originally a 
                loan under this part, the Secretary shall include all 
                monthly payments made on the original loan that meet 
                the requirements of such paragraph.
                    ``(B) Refinanced ffel loans.--In the case of an 
                eligible Federal Direct Loan refinanced under section 
                460A that was originally a loan under part B, only 
                monthly payments made after the date on which the loan 
                was refinanced may be included for purposes of 
                paragraph (2).
            ``(9) Ineligibility.--
                    ``(A) No double benefits.--No borrower may, for the 
                same service, receive a reduction of loan obligations 
                under both this subsection and section 428J, 428K, 
                428L, or 460.
                    ``(B) Federal elected service excluded.--No 
                borrower may receive loan forgiveness under this 
                subsection for service as a Member of Congress or 
                President or Vice President of the United States.''.
            (2) FFEL program amendments.--Part B of the Higher 
        Education Act of 1965 (20 U.S.C. 1071 et seq.) is amended--
                    (A) in section 428 (20 U.S.C. 1078), by adding at 
                the end the following:
    ``(p) Repayment History Information and Public Service Loan 
Forgiveness Information.--A guaranty agency shall--
            ``(1) provide, in a timely manner, any necessary borrower 
        repayment history information that the Secretary requests in 
        order to determine the borrower's eligibility for the public 
        service loan forgiveness program under section 455(m), or the 
        number of qualifying monthly payment obligations satisfied for 
        purposes of the program, including such information from all 
        servicers involved in servicing the borrower's loan; and
            ``(2) carry out the requirements of section 455(m)(7) upon 
        receiving any verbal or written contact by a borrower on or 
        after July 1, 2022, expressing interest in the public service 
        loan forgiveness program under section 455(m).''; and
                    (B) in section 433 (20 U.S.C. 1083)--
                            (i) by redesignating subsection (f) as 
                        subsection (g); and
                            (ii) by inserting after subsection (e) the 
                        following:
    ``(f) Repayment History Information.--An eligible lender shall--
            ``(1) provide, in a timely manner, any necessary borrower 
        repayment history information that the Secretary requests in 
        order to determine the borrower's eligibility for the public 
        service loan forgiveness program under section 455(m), or the 
        number of qualifying monthly payment obligations satisfied for 
        purposes of the public service loan forgiveness program under 
        section 455(m), including such information from all servicers 
        involved in servicing the borrower's loan; and
            ``(2) carry out the requirements of section 455(m)(7) upon 
        receiving any verbal or written contact by a borrower on or 
        after July 1, 2022, expressing interest in the public service 
        loan forgiveness program under section 455(m).''.
    (b) Notification to Direct Loan Borrowers Regarding All Options for 
Loan Forgiveness.--Section 455 of the Higher Education Act of 1965 (20 
U.S.C. 1087e) is amended by adding at the end the following:
    ``(r) Annual Notice Regarding Loan Forgiveness Options.--
            ``(1) In general.--The Secretary shall annually provide a 
        written or electronic disclosure to each borrower of a loan 
        under this part--
                    ``(A) notifying the borrower--
                            ``(i) of any loan forgiveness option 
                        available under this title that might apply to 
                        a loan under this part held by the borrower, 
                        including the public service loan forgiveness 
                        program under subsection (m); and
                            ``(ii) in the case of a borrower who is a 
                        full-time employee of a Federal agency and has 
                        not expressed interest in or submitted a 
                        certification of employment for the public 
                        service loan forgiveness program--
                                    ``(I) that the borrower is employed 
                                by a qualifying employer;
                                    ``(II) the number of payment 
                                obligations satisfied by the borrower 
                                that the Secretary has determined could 
                                be qualifying monthly payment 
                                obligations on eligible Federal Direct 
                                Loan for purposes of the public service 
                                loan forgiveness program; and
                                    ``(III) the steps necessary for the 
                                borrower to submit a certification of 
                                employment and to obtain forgiveness 
                                under subsection (m)(2);
                    ``(B) informing the borrower that the loan 
                forgiveness options described in subparagraph (A) are 
                provided free of charge; and
                    ``(C) including, for each loan forgiveness option, 
                information regarding how the borrower should proceed, 
                including contact information, if the borrower wishes 
                to pursue such loan forgiveness option.
            ``(2) Exclusions.--Notwithstanding paragraph (1), the 
        Secretary shall not provide a notification under this 
        subsection to a borrower of a loan under this part if--
                    ``(A) the borrower is also receiving a notification 
                under subsection (m)(7); or
                    ``(B) the borrower has requested that the Secretary 
                no longer provide the notifications under this 
                subsection.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on July 1, 2022.

SEC. 303. TRANSITION TO IMPROVED PUBLIC SERVICE LOAN FORGIVENESS 
              PROGRAM.

    (a) Review of Borrowers Currently Participating in Public Service 
Loan Forgiveness.--
            (1) Calculating the number of qualifying payment 
        obligations for current public service loan forgiveness program 
        participants.--By not later than July 1, 2022, the Secretary 
        shall, for each borrower that has submitted a certification of 
        employment under the public service loan forgiveness program 
        under section 455(m) of the Higher Education Act of 1965 (20 
        U.S.C. 1087e) before July 1, 2022--
                    (A) calculate the number of qualifying payment 
                obligations under such section satisfied by the 
                borrower, using the criteria of such section as in 
                effect on July 1, 2022; and
                    (B) inform the borrower of the changes in the 
                public service loan forgiveness program and the number 
                of qualifying payment obligations that the borrower 
                will have satisfied for purposes of the program, 
                beginning on July 1, 2022.
            (2) Retroactive partial loan forgiveness.--By not later 
        than July 1, 2022, the Secretary shall take such steps as are 
        necessary to provide partial loan forgiveness under section 
        455(m)(3)(A)(i) of the Higher Education Act of 1965 (20 U.S.C. 
        1087e(m)(3)(A)(i)), as in effect on such date, to borrowers 
        with outstanding balance of principal and interest on a loan 
        made under this part who met the criteria for partial loan 
        forgiveness under such section, as in effect on July 1, 2022, 
        before such date but on or after October 1, 2007.
            (3) Applicability of other provisions.--In carrying out 
        paragraphs (1) and (2), and in any other case where the 
        Secretary is applying the loan forgiveness provisions of 
        section 455(m) of the Higher Education Act of 1965 (20 U.S.C. 
        1087e(m)), as in effect on July 1, 2022, to a borrower for whom 
        one or more payment obligations were satisfied before July 1, 
        2022, the Secretary shall determine the number of payment 
        obligations satisfied by applying all of the provisions of such 
        section as in effect on July 1, 2022, including the calculation 
        of payment obligations under section 455(m)(5) of such Act and 
        the inclusion of payment obligations satisfied through the 
        component loans of a Federal Direct Consolidation Loan under 
        section 455(m)(6), without regard as to the date on which the 
        payment obligation was satisfied.
    (b) Special PSLF Program Funds.--
            (1) Definition of special pslf program funds.--In this 
        section, the term ``special PSLF program funds'' means the 
        amounts appropriated for public service loan forgiveness under 
        section 315 of division H of the Consolidated Appropriations 
        Act, 2018 (Public Law 115-141; March 23, 2018) or under section 
        313 of division B of the Department of Defense and Labor, 
        Health and Human Services, and Education Appropriations Act, 
        2019 and Continuing Appropriations Act, 2019 (Public Law 115-
        245; September 28, 2018).
            (2) Rescission.--Upon the effective date described in 
        section 2(c), all special PSLF program funds that remain 
        unexpended on such date shall be rescinded.
            (3) Transition.--The Secretary of Education shall establish 
        a process through which the Secretary shall--
                    (A) review the applications of borrowers who 
                applied for the loan forgiveness program carried out 
                with special PSLF program funds but had not received 
                loan forgiveness through such program before July 1, 
                2022; and
                    (B) assist such borrowers in pursuing loan 
                forgiveness under section 455(m) of the Higher 
                Education Act of 1965 (20 U.S.C. 1087e(m)), as in 
                effect on July 1, 2022.

                TITLE IV--INCOME-DRIVEN REPAYMENT PLANS

SEC. 401. INCOME-BASED REPAYMENT PLAN.

    Section 493C of the Higher Education Act of 1965 (20 U.S.C. 1098e) 
is amended--
            (1) in subsection (b)--
                    (A) in paragraph (8), by striking ``and'' after the 
                semicolon;
                    (B) in paragraph (9), by striking the period at the 
                end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(10) a borrower who is repaying a loan made under part B 
        or D pursuant to this section may repay such loan in full at 
        any time without penalty.''; and
            (2) by adding at the end the following:
    ``(f) Income-Based Repayment for New Loans on and After July 1, 
2022, and for Borrowers Who Enter IBR After July 1, 2022.--
            ``(1) In general.--The income-based repayment plan shall be 
        carried out in accordance with this section, except as 
        otherwise specified in this subsection (including through the 
        special terms described in paragraph (2))--
                    ``(A) with respect to any loan issued on or after 
                July 1, 2022, if such borrower elects the income-based 
                repayment plan for that loan; and
                    ``(B) with respect to any borrower who is repaying 
                a loan made, insured, or guaranteed under part B or D, 
                if such borrower elects to repay the loan under the 
                income-based repayment plan on or after July 1, 2022.
            ``(2) Special terms.--Notwithstanding any other provision 
        of this section, with respect to a loan described under 
        paragraph (1), the following terms shall apply to the income-
        based repayment plan:
                    ``(A)(i) Notwithstanding subsection (a)(3)(B), the 
                repayment amount under this subsection shall be an 
                amount equal to 5 percent of the result obtained by 
                calculating, on at least an annual basis, the amount by 
                which--
                            ``(I) the borrower's, and the borrower's 
                        spouse (if applicable), adjusted gross income; 
                        exceeds
                            ``(II) the applicable percentage of the 
                        poverty line in accordance with clause (ii) 
                        that is applicable to the borrower's family 
                        size as determined under section 673(2) of the 
                        Community Services Block Grant Act (42 U.S.C. 
                        9902(2)).
                    ``(ii) For purposes of clause (i), the term 
                `applicable percentage' means 150 percent reduced by 1 
                percentage point for each $1,000 by which the 
                borrower's adjusted gross income exceeds $100,000.
                    ``(B) A borrower may elect--
                            ``(i) during any period during which the 
                        borrower's (and the borrower's spouse, if 
                        applicable) adjusted gross income is equal to 
                        or less than 250 percent of the poverty line 
                        applicable to the borrower's family size as 
                        determined under section 673(2) of the 
                        Community Services Block Grant Act (42 U.S.C. 
                        9902(2)), to have the borrower's aggregate 
                        monthly payment for all such loans equal to $0; 
                        and
                            ``(ii) during any period during which the 
                        borrower's (and the borrower's spouse, if 
                        applicable) adjusted gross income exceeds 250 
                        percent of such poverty line, to have the 
                        borrower's aggregate monthly payment for all 
                        such loans not exceed, the lesser of--
                                    ``(I) the result described in 
                                subparagraph (A) divided by 12; or
                                    ``(II) the monthly amount 
                                calculated under section 455(d)(1)(A), 
                                based on a 10-year repayment period, 
                                when the borrower first made the 
                                election described in this subsection.
                    ``(C) With respect to any loan for which payments 
                may be made under subparagraph (B), be paid, or be 
                treated as if no interest has accrued, by the 
                Secretary--
                            ``(i) for any period described in 
                        subparagraph (B)(i); and
                            ``(ii) for the 6-month period after the 
                        date the borrower ceases to carry at least one-
                        half the normal full-time academic workload at 
                        an institution of higher education, as 
                        determined by the institution, and during which 
                        the borrower is not earning any income.
                    ``(D) Subsection (b)(7)(B) shall be applied by 
                substituting `20 years' for `25 years'.
                    ``(E) A borrower of such a loan shall not be 
                required to have a partial financial hardship and may 
                elect, and remain enrolled in, the income-based 
                repayment plan under this subsection regardless of 
                income level.
                    ``(F) Subparagraph (A) of subsection (b)(6) shall 
                not apply and a borrower's monthly payment shall be 
                determined in accordance with subparagraph (A) divided 
                by 12, which may exceed the monthly repayment amount 
                under a standard 10-year repayment plan.
                    ``(G) Subparagraph (B) of subsection (b)(3) shall 
                not apply.
            ``(3) Additional special terms for certain borrowers.--A 
        borrower described in paragraph (1)(B)--
                    ``(A) may choose to retain the repayment plan in 
                which the borrower is enrolled on June 30, 2022;
                    ``(B) may elect to--
                            ``(i) leave the repayment plan described in 
                        subparagraph (A) and enter the income-based 
                        repayment plan under this subsection;
                            ``(ii) leave the repayment plan described 
                        in subparagraph (A) and enter a standard 10-
                        year repayment plan under section 455(d)(A)(A); 
                        or
                            ``(iii) not more than once per calendar 
                        year, switch between the repayment plans 
                        described in clauses (i) and (ii);
                    ``(C) after electing to leave a repayment plan 
                other than an income-based repayment plan described 
                under this subsection or a standard 10-year repayment 
                plan under section 455(d)(A)(A), shall not be permitted 
                to re-elect a repayment plan that is not an income-
                based repayment plan under this subsection or such 
                standard 10-year repayment plan; and
                    ``(D) shall retain, for purposes of repayment or 
                cancellation of any outstanding balance of principal 
                and interest due on a loan (as described in subsection 
                (b)(7)) any years of repayment under another income-
                based or income-contingent repayment plan under this 
                title.
            ``(4) Cap on interest accrual.--Notwithstanding any other 
        provision of this Act, the total amount of interest that 
        accrues during a borrower's grace period and the time that a 
        borrower is in repayment under this subsection shall not exceed 
        50 percent of the original principal amount of the loan.''.

SEC. 402. TERMINATION OF CERTAIN REPAYMENT PLAN OPTIONS.

    (a) Effective Date; Rulemaking Regarding Termination of Certain 
Repayment Plans.--
            (1) Effective date.--The amendments made by this section 
        shall take effect on July 1, 2022.
            (2) Regulations.--Before the effective date described in 
        paragraph (1), the Secretary of Education shall carry out a 
        plan to end all eligibility for repayment plans other than a 
        standard repayment plan under section 428(b)(9)(A)(i) or 
        455(d)(1)(A) with a repayment period of 10 years and an income-
        based repayment plan described under section 493C(f) for loans 
        made under part B or D of title IV of the Higher Education Act 
        of 1965, unless the borrower is enrolled in another repayment 
        plan before such effective date, in accordance with the 
        amendments made by this Act.
    (b) Changes to Current Law.--
            (1) Section 428(b) of the Higher Education Act of 1965 (20 
        U.S.C. 1078(b)) is amended--
                    (A) in paragraph (1)--
                            (i) in subparagraph (D)--
                                    (I) in clause (ii), by striking 
                                ``may annually change the selection of 
                                a repayment plan under this part,'' and 
                                inserting ``may at any time after July 
                                1, 2022, and not more frequently than 
                                once per calendar year thereafter, 
                                change the selection of a repayment 
                                plan under this part to one of the 2 
                                repayment plans described in paragraph 
                                (9)(C),''; and
                                    (II) in clause (iii), by striking 
                                ``be subject to income-contingent 
                                repayment in accordance with subsection 
                                (m);'' and inserting ``be subject to 
                                income-based repayment in accordance 
                                with section 493C(f);''; and
                            (ii) in subparagraph (E)(i), by striking 
                        ``the option of repaying the loan in accordance 
                        with a standard, graduated, income-sensitive, 
                        or extended repayment schedule (as described in 
                        paragraph (9)) established by the lender in 
                        accordance with regulations of the Secretary; 
                        and'' and inserting ``the option of repaying 
                        the loan in accordance with a repayment plan 
                        described in paragraph (9)(C) established by 
                        the lender in accordance with regulations of 
                        the Secretary; and''; and
                    (B) in paragraph (9), by adding at the end the 
                following:
                    ``(C) Selection of repayment plans on and after 
                july 1, 2022.--
                            ``(i) Opportunity to change repayment 
                        plans.--Notwithstanding any other provision of 
                        this paragraph, or any other provision of law, 
                        and in accordance with regulations, beginning 
                        on July 1, 2022, the lender shall offer a 
                        borrower of a loan made, insured, or guaranteed 
                        under this part the opportunity to change 
                        repayment plans not more than once per calendar 
                        year, and to enroll in one of the following 
                        repayment plans:
                                    ``(I) A standard repayment plan 
                                under section 428(b)(9)(A)(i) with a 
                                repayment period of 10 years.
                                    ``(II) The income-based repayment 
                                plan under section 493C(f).''.
            (2) Section 455(d) is amended--
                    (A) by redesignating paragraphs (2) through (5) as 
                paragraphs (3) through (6), respectively;
                    (B) by inserting after paragraph (1), the 
                following:
            ``(2) Design and selection on and after july 1, 2022.--
                    ``(A) In general.--Notwithstanding paragraph (1), 
                for the borrower of a loan made on or after July 1, 
                2022, and for other borrowers subject to paragraph (7), 
                the Secretary shall offer a borrower of a loan made 
                under this part 2 plans for repayment of such loan, 
                including principal and interest on the loan. The 
                borrower shall be entitled to accelerate, without 
                penalty, repayment on the borrower's loans under this 
                part. The borrower may choose--
                            ``(i) a standard repayment plan under 
                        section 455(d)(1)(A) with a repayment period of 
                        10 years; or
                            ``(ii) the income-based repayment plan 
                        under section 493C(f).
                    ``(B) Selection by the secretary.--If a borrower of 
                a loan made under this part on or after July 1, 2022, 
                does not select a repayment plan described in 
                subparagraph (A), the Secretary may provide the 
                borrower with a standard repayment plan under section 
                455(d)(1)(A) with a repayment period of 10 years.
                    ``(C) Changes in selections.--Beginning on July 1, 
                2022, a borrower of a loan made under this part may 
                change the borrower's selection of a repayment plan in 
                accordance with paragraph (7) and under such terms and 
                conditions as may be established by the Secretary.
                    ``(D) Borrower in default.--Beginning on July 1, 
                2022, the Secretary may require any borrower who has 
                defaulted on a loan made under this part to--
                            ``(i) pay all reasonable collection costs 
                        associated with such loan; and
                            ``(ii) repay the loan pursuant to an 
                        income-based repayment plan under section 
                        493C(f).''; and
                    (C) by adding at the end the following:
            ``(7) Borrowers of loans made before july 1, 2022.--A 
        borrower who is in repayment on a loan made under part B or 
        part D before July 1, 2022--
                    ``(A) may choose to retain the repayment plan that 
                the borrower was enrolled in on the day before such 
                date;
                    ``(B) may elect to--
                            ``(i) enter the income-based repayment plan 
                        under section 493C(f);
                            ``(ii) enter a standard repayment plan 
                        under section 455(d)(1)(A) with a repayment 
                        period of 10 years; or
                            ``(iii) switch between the repayment plans 
                        described in clauses (i) and (ii) not more than 
                        once during a calendar year;
                    ``(C) after electing to leave a repayment plan 
                other than an income-based repayment plan described in 
                this subsection or a standard repayment plan under 
                section 455(d)(1)(A), shall not be permitted to re-
                elect a repayment plan that is not an income-based 
                repayment plan described in this subsection or a 
                standard repayment plan under section 455(d)(1)(A); and
                    ``(D) shall retain, for purposes of repayment or 
                cancellation of any outstanding balance of principal 
                and interest due on a loan (as described in section 
                493C(b)(7)) any years of repayment under another 
                income-based or income-contingent repayment plan under 
                this title.''.

SEC. 403. NOTIFICATION AND AUTOMATIC ENROLLMENT PROCEDURES FOR 
              BORROWERS WHO ARE DELINQUENT ON LOANS.

    (a) Income-Contingent Repayment.--Section 455(d) of the Higher 
Education Act of 1965 (20 U.S.C. 1087e(d)) is further amended by adding 
at the end the following:
            ``(8) Notification and automatic enrollment procedures for 
        borrowers who are delinquent on loans.--
                    ``(A) Authority to obtain income information.--
                            ``(i) In general.--In the case of any 
                        borrower who is at least 60 days delinquent on 
                        a covered loan, the Secretary may obtain such 
                        information as is reasonably necessary 
                        regarding the income and family size of the 
                        borrower (and the borrower's spouse, if 
                        applicable).
                            ``(ii) Availability of returns and return 
                        information.--Returns and return information 
                        (as defined in section 6103 of the Internal 
                        Revenue Code of 1986) may be obtained under 
                        this subparagraph only to the extent authorized 
                        by section 6103(l)(13) of such Code.
                    ``(B) Borrower notification.--With respect to each 
                borrower of a covered loan who is at least 60 days 
                delinquent on such loan and who has not been subject to 
                the procedures under this paragraph for such loan in 
                the preceding 120 days, the Secretary shall, as soon as 
                practicable after such 60-day delinquency, provide to 
                the borrower the following:
                            ``(i) Notification that the borrower is at 
                        least 60 days delinquent on at least 1 covered 
                        loan, and a description of all delinquent 
                        covered loans, nondelinquent covered loans, and 
                        noncovered loans of the borrower.
                            ``(ii) A brief description of the repayment 
                        plans for which the borrower is eligible and 
                        the covered loans and noncovered loans of the 
                        borrower that may be eligible for such plans, 
                        based on information available to the 
                        Secretary.
                            ``(iii) Clear and simple instructions on 
                        how to select the repayment plans.
                            ``(iv) The amount of monthly payments for 
                        the covered and noncovered loans under the 
                        repayment plans for which the borrower is 
                        eligible, based on information available to the 
                        Secretary, including, if the income information 
                        of the borrower is available to the Secretary 
                        under subparagraph (A)--
                                    ``(I) the amount of the monthly 
                                payment under each income-driven 
                                repayment plan for which the borrower 
                                is eligible for the borrower's covered 
                                and noncovered loans, based on such 
                                income information; and
                                    ``(II) the income, family size, tax 
                                filing status, and tax year information 
                                on which each monthly payment is based.
                            ``(v) An explanation that in the case of a 
                        borrower for whom adjusted gross income is 
                        unavailable--
                                    ``(I) if the borrower selects to 
                                repay the covered loans of such 
                                borrower pursuant to an income-driven 
                                repayment plan that defines 
                                discretionary income in such a manner 
                                that an individual not required under 
                                section 6012(a)(1) of the Internal 
                                Revenue Code of 1986 to file a return 
                                with respect to income taxes imposed by 
                                subtitle A of such Code may have a 
                                calculated monthly payment greater than 
                                $0, the borrower will be required to 
                                provide the Secretary with other 
                                documentation of income satisfactory to 
                                the Secretary, which documentation the 
                                Secretary may use to determine an 
                                appropriate repayment schedule; and
                                    ``(II) if the borrower selects to 
                                repay such loans pursuant to an income-
                                driven repayment plan that is not 
                                described in subclause (I), the 
                                borrower will not be required to 
                                provide the Secretary with such other 
                                documentation of income, and the 
                                borrower will have a calculated monthly 
                                payment of $0.
                            ``(vi) An explanation that the Secretary 
                        shall take the actions under subparagraph (C) 
                        with respect to such borrower, if--
                                    ``(I) the borrower is 120 days 
                                delinquent on one or more covered loans 
                                and has not selected a new repayment 
                                plan for the covered loans of the 
                                borrower; and
                                    ``(II) in the case of such a 
                                borrower whose repayment plan for the 
                                covered loans of the borrower is not an 
                                income-driven repayment plan, the 
                                monthly payments under such repayment 
                                plan are higher than such monthly 
                                payments would be under an income-
                                driven repayment plan for such loans.
                            ``(vii) Instructions on updating the 
                        information of the borrower obtained under 
                        subparagraph (A).
                    ``(C) Secretary's initial selection of plan.--With 
                respect to each borrower described in subparagraph (B) 
                who has a repayment plan for the covered loans of the 
                borrower that meets the requirements of clause (vi)(II) 
                of subparagraph (B) and has not selected a new 
                repayment plan for such loans in accordance with the 
                notice received under such subparagraph, and who is at 
                least 120 days delinquent on such a loan, the Secretary 
                shall, as soon as practicable--
                            ``(i) in a case in which any of the 
                        borrower's covered loans are eligible for an 
                        income-driven repayment plan--
                                    ``(I)(aa) provide the borrower with 
                                the income-driven repayment plan that 
                                requires the lowest monthly payment 
                                amount for each covered loan of the 
                                borrower, compared to any other such 
                                plan for which the borrower is 
                                eligible; or
                                    ``(bb) if more than one income-
                                driven repayment plan would offer the 
                                borrower the same lowest monthly 
                                payment amount, provide the borrower 
                                with the income-driven repayment plan 
                                that has the most favorable terms for 
                                the borrower;
                                    ``(II) if the plan selected under 
                                subclause (I) is not the income-driven 
                                repayment plan that would have the 
                                lowest monthly payment amount if the 
                                borrower were eligible for such plan 
                                for the borrower's covered loans and 
                                noncovered loans, notify the borrower 
                                of the actions, if any, the borrower 
                                may take to become eligible for such 
                                income-driven repayment plan; and
                                    ``(III) authorize the borrower to 
                                change the Secretary's selection of a 
                                plan under this clause to any plan 
                                described in paragraph (1) for which 
                                the borrower is eligible; and
                            ``(ii) in a case in which none of the 
                        borrower's covered loans are eligible for an 
                        income-driven repayment plan, notify the 
                        borrower of the actions, if any, the borrower 
                        may take for such loans to become eligible for 
                        such a plan.
                    ``(D) Secretary's additional selection of plan.--
                            ``(i) In general.--With respect to each 
                        borrower of a covered loan who selects a new 
                        repayment plan in accordance with the notice 
                        received under subparagraph (B) and who 
                        continues to be delinquent on such loan for a 
                        period described in clause (ii), the Secretary 
                        shall, as soon as practicable after such 
                        period, carry out the procedures described in 
                        clauses (i) and (ii) of subparagraph (C) for 
                        the covered loans of the borrower, if such 
                        procedures would result in lower monthly 
                        repayment amounts on such loan.
                            ``(ii) Description of period.--The duration 
                        of the period described in clause (i) shall be 
                        the amount of time that the Secretary 
                        determines is sufficient to indicate that the 
                        borrower may benefit from repaying such loan 
                        under a new repayment plan, but in no case 
                        shall such period be less than 60 days.
                    ``(E) Opt-out.--A borrower of a covered loan shall 
                have the right to opt-out of the procedures under this 
                paragraph.
            ``(9) Definitions.--In this subsection:
                    ``(A) Covered loan.--The term `covered loan' 
                means--
                            ``(i) a loan made under this part;
                            ``(ii) a loan purchased under section 459A; 
                        or
                            ``(iii) a loan that has been assigned to 
                        the Secretary under section 428(c)(8) or part 
                        E.
                    ``(B) Income-driven repayment plan.--The term 
                `income-driven repayment plan' means--
                            ``(i) in the case of a covered loan made 
                        under this part, purchased under section 459A, 
                        or assigned to the Secretary before July 1, 
                        2022, a plan described in subparagraph (D) or 
                        (E) of paragraph (1); and
                            ``(ii) in the case of a covered loan made 
                        under this part, purchased under section 459A, 
                        or assigned to the Secretary before July 1, 
                        2022, the income-based repayment plan under 
                        section 493C(f).
                    ``(C) Noncovered loan.--The term `noncovered loan' 
                means a loan made, insured, or guaranteed under this 
                title that is not a covered loan.''.
    (b) Changing Plans.--Section 493C(b)(8) of the Higher Education Act 
of 1965 (20 U.S.C. 1098e(b)(8)) is amended to read as follows:
            ``(8) a borrower who is repaying a loan made, insured, or 
        guaranteed under part B or D pursuant to income-based repayment 
        may elect, at any time, to terminate repayment pursuant to 
        income-based repayment and repay such loan under any repayment 
        plan for which the loan is eligible in accordance with the 
        requirements of part B or part D, respectively; and''.
    (c) Effective Date; Application.--
            (1) Automatic enrollment.--The amendments made by 
        subsection (a) shall--
                    (A) take effect as soon as the Secretary of 
                Education determines practicable, but not later than 2 
                years after the date of enactment of this Act; and
                    (B) apply to all borrowers of covered loans (as 
                defined in section 455(d)(9) of the Higher Education 
                Act of 1965, as added by subsection (a)).
            (2) Changing plans.--The amendment made by subsection (b) 
        shall take effect on the date of enactment of this Act.

SEC. 404. AUTOMATIC RECERTIFICATION FOR INCOME-DRIVEN REPAYMENT PLANS.

    Section 455(e)(8)(A) of the Higher Education Act of 1965 (20 U.S.C. 
1087e(e)(8)(A)) is amended--
            (1) by striking ``and'' after clause (ii);
            (2) in clause (iii), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
                            ``(iv) in the case of a borrower for whom 
                        adjusted gross income is unavailable--
                                    ``(I) if the borrower has selected 
                                to repay the covered loans of such 
                                borrower pursuant to an income-
                                contingent repayment plan that defines 
                                discretionary income in such a manner 
                                that an individual not required under 
                                section 6012(a)(1) of the Internal 
                                Revenue Code of 1986 to file a return 
                                with respect to income taxes imposed by 
                                subtitle A of such Code may have a 
                                calculated monthly payment greater than 
                                $0, the borrower will be required to 
                                provide the Secretary with other 
                                documentation of income satisfactory to 
                                the Secretary, which documentation the 
                                Secretary may use to determine an 
                                appropriate repayment schedule; or
                                    ``(II) if the borrower has selected 
                                to repay such loans pursuant to an 
                                income-contingent repayment that is not 
                                described in subclause (I), the 
                                borrower will not be required to 
                                provide the Secretary with such other 
                                documentation of income, and the 
                                borrower will have a calculated monthly 
                                payment of $0.''.
                                 <all>
HIGHER ED Act
To amend the Higher Education Act of 1965 to improve loans, and for other purposes.
HIGHER ED Act
Helping Individuals Get a Higher Education while Reducing Education Debt Act
Rep. DeFazio, Peter A.