Page:United States Statutes at Large Volume 103 Part 3.djvu/48

 103 STAT. 2116 PUBLIC LAW 101-239—DEC. 19, 1989 which the student is eligible under this title, the institution such student is attending shall withhold and return to the lender or escrow agent the portion (or all) ci such installment that exceeds such eligible amount. Any portion (or all) of a disbursement installment which is so redimed shall be credited to the borrower's loan and treated as a prepayment thereon. "ie) EXCLUSION OF FLUS» CONSOUOATION, AND FOBEIGN STUDY LOANS.—The provisions of this section shall not apply in the case of a loan made under section 42^ or 428C or made to a student to cover the cost of attendance at an eligilie institution outside the United States. "(0 BEGINNING OF PERIOD OF ENBOLLMENT. —For purposes of this section, a period of enndlmoit begins on the first day that classes begin fbr the applicable period of enrollment.". Cb) OoNFOBMiNG AMENDMENTS.— (1) TRANSMITTAL OF INSTITUTION SCHEDULES TO LENDERS.— Section 428(a)(2)(AXD of the Hic^ Education Act of 1965 (20 UJS.C. 1078(a)(2)(AXD) is amended— (A) by striking "and" at the end of clause CD; and (B) by inserting after dause (ID the following: the proceeds (tf the loan in installments, consistent with the requirements of section 428G; and". (Zi FEDERALLY INSURED LOANS. — Section 427(a)(4) of the Higher Education Act of 1965 (20 UJS.C. 1077(a)(4)) ia amended to read as follows: 'X4) the funds borrowed by a student are disbursed in accord- ance with section 428G.". (3) STAFFORD LOANS.— Section 428(b)(l)(O) of the Higher Edu- cation Act of 1965 (20 U.S.C. 1078(b)(l)(O)) is amended to read as - follows: "(O) inrovides that the proceeds of the loans will be dis- bursed in accordance with the requirements of section 428G;". 20 USC 1077 (c) EFFECTIVE DATE.- The amendments made by this section shall iqiply with req;)ect to loans made to cover the cost of instruction for periods of enrollment bqpnning on or after January 1, 1990. SEC low. DEFAULT BEDUCnON PROGRAM. (a) AMENDMENT. — Section 428F of the Higher Education Act of 1965 (20 UJS.C. 1078-6) is amended to read as follows: "D EFAULT REDUCTION PROGRAM "SEC. 428F. (a) PROGRAM REQUIREMENTS. — GRAM.—The Secretary shall, in accordance with the require- ments of this section, establish a default reduction program fcnr borroweis who have one or more loans under part B of this title which are in de&ult, as defined in section 435(1), as of the date of enactment of this section. Such program shall be commenced on, March 1, 1990, and shall last for six months. PROGRAM.—In order to be eligible for the benefits of the default reduction program, a borrower who has a loan or loans which are in default shall contact the hcdder of such loan or loans note.
 * VID sets forth a schedule for di^ursement of
 * X1) AUTHORITY TO ESTABLISH A DEFAULT REDUCTION PRO-
 * \2) EuGraniTY FOR THE BENEFITS OF THE DEFAULT REDUCTION

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