Page:United States Statutes at Large Volume 116 Part 1.djvu/35

 PUBLIC LAW 107-139—FEB. 8, 2002 116 STAT. 9 "(1) INTEREST RATE. —(A) Notwithstanding subparagraphs (B) and (C), with respect to any loan made under this section for which the apphcation is received by an eligible lender— "(i) on or after October 1, 1998, and before July 1, 2006, the applicable interest rate shall be determined under section 427A(k)(4); or "(ii) on or after July 1, 2006, the applicable interest rate shall be determined under section 427A(1)(3).". (b) DIRECT LOANS FIXED INTEREST RATES. — (1) TECHNICAL CORRECTION. —Paragraph (6) of section 455(b) of the Higher Education Act of 1965 (20 U.S.C. 1087e(b)), as redesignated by section 8301(c)(1) of the Transportation Equity Act for the 21st Century (Public Law 105-178; 112 Stat. 498) is redesignated as paragraph (9) and is transferred to follow paragraph (7) of section 455(b) of the Higher Education Act of 1965. (2) AMENDMENTS.— Section 455(b) of the Higher Education Act of 1965 (20 U.S.C. 1087e(b)) is amended— (A) by redesignating paragraph (7) as paragraph (8); and (B) by inserting after paragraph (6) the following new paragraph: "(7) INTEREST RATE PROVISION FOR NEW LOANS ON OR AFTER JULY 1, 2006.— "(A) RATES FOR FDSL AND FDUSL.— Notwithstanding the preceding paragraphs of this subsection, for Federal Direct Stafford Loans and Federal Direct Unsubsidized Stafford Loans for which the first disbursement is made on or after July 1, 2006, the applicable rate of interest shall be 6.8 percent on the unpaid principal balance of the loan. "(B) PLUS LOANS. —Notwithstanding the preceding paragraphs of this subsection, with respect to any Federal Direct PLUS loan for which the first disbursement is made on or after July 1, 2006, the applicable rate of interest shall be 7.9 percent on the unpaid principal balance of the loan. "(C) CONSOLIDATION LOANS. —Notwithstanding the preceding paragraphs of this subsection, any Federal Direct Consolidation loan for which the application is received on or after July 1, 2006, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the lesser of— "(i) the weighted average of the interest rates on the loans consolidated, rounded to the nearest higher one-eighth of one percent; or "(ii) 8.25 percent.". (c) EXTENSION OF CURRENT INTEREST RATE PROVISIONS FOR THREE YEARS.— Sections 427A(k) and 455(b)(6) of the Higher Education Act of 1965 (20 U.S.C. 1077a(k), 1087e(b)(6)) are each amended— (1) by striking "2003" in the heading and inserting "2006"; and (2) by striking "July 1, 2003," each place it appears and inserting "July 1, 2006,".

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