Page:United States Statutes at Large Volume 100 Part 2.djvu/288

 100 STAT. 1390

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PUBLIC LAW 99-498—OCT. 17, 1986

holders of the outstanding loans of that borrower (which ha& X are so selected for consolidation); "(B) that each consolidation loan made by the lender will •A) • bear interest, and be subject to repayment, in accordance with subsection (c); 'i '(C) that each consolidation loan will be made, notwithstanding any other provision of this part limiting the annual or aggregate principal amount for all insured loans made to a borrower, in an amount (i) which is not less than the minimum amount required for eligibility of the borrower under subsection (a)(2), and (ii) which is equal to the sum of the unpaid principal and accrued unpaid interest and late charges of all loans received by the eligible borrower under this title which are selected by the borrower for consolidation; £,,,,.. "(D) that the proceeds of each consolidation loan will be ,'X paid by the lender to the holder or holders of the loans so selected to discharge the liability on such loans; "(E) such other terms and conditions as the Secretary or the guaranty agency may specifically require of the lender to carry out this section. "(2) ISSUANCE OF CERTIFICATE OF COMPREHENSIVE INSURANCE

COVERAGE.—The Secretary shall issue a certificate of comprehensive insurance coverage under section 429(b) to a lender which has entered into an agreement with the Secretary under paragraph (1) of this subsection. The guaranty agency may issue a certificate of comprehensive insurance coverage to a lender with which it has an agreement under such paragraph. The Secretary shall not issue a certificate to a lender described in subparagraph (B) or (C) of subsection (a)(1) unless the Secretary determines that such lender has first applied to, and has been denied a certificate of insurance by, the guaranty agency which "(3) CONTENTS OF CERTIFICATE.—A certificate issued under paragraph (2) shall, at a minimum, provide— Sc "(A) that all consolidation loans made by such lender in conformity with the requirements of this section will be insured by the Secretary or the guaranty agency (whichever is applicable) against loss of principal and interest; ?«3 K "(B) that a consolidation loan will not be insured unless >?• J S^ i ^ the lender has determined to its satisfaction, in accordance an A ' with reasonable and prudent business practices, for each loan being consolidated— { 1 "(i) that the loan is a legal, valid, and binding obligai• tion of the borrower; lii "(ii) that each such loan was made and serviced in n: compliance with applicable laws and regulations; and "(iii) in the case of loans under this part, that the . V insurance on such loan is in full force and effect; "(C) the effective date and expiration date of the certificate; "(D) the aggregate amount to which the certificate 1^ applies; -^f. "(E) the reporting requirements of the Secretary on the lender and an identification of the office of the Department of Education or of the guaranty agency which will process claims and perform other related administrative functions;
 * insures the preponderance of its loans (by value).

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