Page:United States Statutes at Large Volume 102 Part 4.djvu/154

 102 STAT. 3124

PUBLIC LAW 100-607—NOV. 4, 1988

"(Q for such loans made after such date, the loan involved was made in an amount of less than $2,500. "(2) With respect to an eligible institution that has commenced an action pursuant to subsection (a), the Secretary shall make the payment required in such subsection, or deny the claim for such payment, not later than 60 days after the date on which the eligible institution notifies the Secretary that judgment has been entered with respect to the action. "(i) The Secretary may establish reasonable limits for default rates for borrowers in each of the health professions identified in section 737(1). If the eligible institutions within any of the health professions, taken as a group, exceed such limits, the Secretary may suspend, terminate, or otherwise restrict the eligibility of such group of sdiools for borrowing under this section.". (1) STATE DESIGNATIONS OF ELIGIBLE LENDERS.—Section 737(2) (42 U.S.C. 294j(2)) is amended— (1) by striking "or" after "State," the second place such term appear^ and (2) by inserting before the period the following: ", or a nonprofit private entity designated by the State, regulated by the State, and approved by the Secretary". (m) REKSUANCE AND REFINANCING AGREEMENTS AUTHORIZED.—

Subpart I of part C of title V n (42 U.S.C. 294 et seq.) is amended by adding at the end thereof the following new section: 42 USC 294/-1.

"SEC 739A. REISSUANCE AND REFINANCING OF CERTAIN LOANS,

"(a) I N GENEEAIK—Any borrower who received a loan insured under this subpart bearing an interest rate that is fixed at a rate in excess of 12 percent per year may enter into an agreement with the eligible lender that made such loan for the reissuance of such loan in order to permit the borrower to obtain for such loan the interest rate in efiect for loans insurable under this subpart on the date the borrower submits an application to such lender for such reissuance. "(b) PROCEDURES.— "(1) DISCHARGE BY OBTAINING LOAN.—Any borrower who re-

ceived a loan under this subpart bearing an interest rate that is fixed at a rate in excess of 12 percent per year may obtain a loan from an eligible lender (other than the original lender) for the purpose of dischazging the loan from such original eligible lender. A loan made for such purpose— "(A) shall bear interest at the interest rate in effect for loans insurable under this subpart on the date the borrower submits an application for a loan under this subsection; and "(B) shall be applied to dischsuge the borrower from any remaining obligation to the original eligible lender with respect to the original loan. "(2) CERTIFICATION.—E^ach new eligible lender may accept certification fix>m the original eligible lender to the borrower's original loan in lieu of presentation of the original promissozy note. "(c) TIME OF PAYMENT.—Any loan reissued under subsection (a) or

refinanced under subsection 0>) shall be payable during the repayment period applicable to the loan made under this subpart prior to the date of enactment of this section, and such reissuance or refinancing shall not result in the extension of the duration of the loan.

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