Page:United States Statutes at Large Volume 95.djvu/943

 PUBLIC LAW 97-35—AUG. 13, 1981 ending September 30, 1983; and $250,000,000 for the fiscal year ending September 30, 1984". (2) The last sentence of such subsection is amended by striking out "1982" and inserting in lieu thereof "1987". (b) Section 728(c) is amended to read as follows: "(c)(1) Subject to paragraph (2), the Student Loan Marketing Association, established under part B of title IV of the Higher Education Act of 1965, is authorized to make advances on the security of, purchase, service, sell, consolidate, or otherwise deal in loans which are insured by the Secretary under this subpart, except that if any loan made under this subpart is included in a consolidated loan pursuant to the authority of the Association under part B of title IV of the Higher Education Act of 1965, the interest rate on such consolidated loan shall be set at the weighted average interest rate of all loans offered for consolidation and the resultant per centum shall be rounded downward to the nearest one-eighth of 1 per centum, except that the interest rate shall be no less than the applicable interest rate of the guaranteed student loan program established under part B of title IV of the Higher Education Act of 1965. In the case of such a consolidated loan, the borrower shall be responsible for any interest which accrues prior to the beginning of the repayment period of the loan, or which accrues during a period in which principal need not be paid (whether or not such principal is in fact paid) by reason of any provision of the Higher Education Act of 1965. Special allowances payable with respect to consolidated loans made by the Association pursuant to the terms of this subsection— "(A) shall be computed in accordance with section 438(b)(2)(A) of the Higher Education Act of 1965, and "(B) shall be reduced (i) by subtracting 7 percent from the weighted average interest rate of a loan computed according to this subsection, and (ii) by subtracting the resultant remainder from such special allowance. "(2) No loan insured by the Secretary under this subpart may be included in a consolidated loan pursuant to the authority of the Student Loan Marketing Association under part B of title IV of the Higher Education Act of 1965 if as a result of such inclusion the Federal Government becomes liable for any greater payment of principal or interest under the provisions of section 439(o) of the Higher Education Act of 1965 than the Federal Government would have been liable for had no consolidation occurred.". LIMITATIONS

SEC. 2727. Section 729(a) (42 U.S.C. 294b(a)) is amended to read as follows: "LIMITATIONS ON INDIVIDUAL FEDERALLY INSURED LOANS AND ON FEDERAL LOAN INSURANCE

"SEC. 729. (a) The total of the loans made to a student in any academic year or its equivalent (as determined by the Secretary) which may be covered by Federal loan insurance under this subpart may not exceed $20,000 in the case of a student enrolled in a school of medicine, osteopathy, dentistry, veterinary medicine, optometry, or podiatry, and $12,500 in the case of a student enrolled in a school of pharmacy, public health, or chiropractic, or a graduate program in health administration or clinical psychology. The aggregate insured unpaid principal amount for all such insured loans made to any

95 STAT. 917

42 USC 294a. 20 USC 1071.

20 USC lOOl ^°Ante, p. 454.

94 Stat. 1430. ^" ^°^ 1087-2.

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