At least one segment is comed prior to or during the 9 to 11th period.

hority: 38 U.S.C. 1682A(e), (repealed, L. 100-689, section 124(a)))

R 31764. July 29, 1975, as amended at 44 2505. Oct. 31, 1979; 48 FR 37995, Aug. 22, 54 FR 34984, Aug. 23, 1989; 61 FR 26115, 24.1996)

4501 Eligibility.

) General. Any eligible spouse or iving spouse shall be eligible to ree an education loan if he or she ts the criteria of this section.

hority: 38 U.S.C. 3512(f), 3698)

Eligibility criteria. To qualify for Education loan

The eligible spouse's or surviving se's delimiting period as detered by $21.3046 (a), (b), or (d), or 3047 must have expired;

The eligible spouse or surviving se must

Have financial resources that may sonably be expected to be expended education needs and which are incient to meet the actual costs of ndance;

Execute a promissory note payto the Department of Veterans Afas provided by §21.4504;

Have unused entitlement prounder 38 U.S.C. 3511;

During the term, quarter, or seter for which the loan is granted, nrolled on a full-time basis in purof the approved program of eduon in which he or she was enrolled the date his or her eligibility exed under §21.3046 (a), (b), or (d), or 3047; and

Have been enrolled in a program lucation on a full-time basis

On the date his or her period of bility expired under §21.3046 (a), or (d), or § 21.3047; or

On the last date of the ordinary ,semester or quarter preceding date his or her eligibility expired er §21.3046 (a), (b), or (d), or §21.3047, he delimiting date fell during a ol break or summer term.

hority: 38 U.S.C. 3512(f), 3698)

Limitations. The period for which a may be granted shall not extend

beyond the earliest of the following dates:

(1) Two years after the expiration of the period of eligibility as determined by §21.3046(a), (b), or (d), or § 21.3047;

(2) The date on which the eligible spouse's or surviving spouse's entitlement is exhausted; or

(3) The date on which the eligible spouse or surviving spouse completes the approved program of education which he or she was pursuing on the date the delimiting period determined by §21.3046 (a), (b), or (d), or § 21.3047 expired.

(Authority: 38 U.S.C. 3512(f), 3698)

(d) Exclusions. No eligible spouse or surviving spouse shall be authorized an education loan if he or she has defaulted on a previous education loan and there is a remaining unliquidated payment due VA.

(Authority: 38 U.S.C. 3512(f), 3698)

[61 FR 26115, May 24, 1996, as amended at 62 FR 51785, Oct. 3, 1997]

§ 21.4502 Applications.

(a) General. An eligible spouse or surviving spouse shall make an application for an education loan in the manner prescribed and upon the forms prescribed by the Department of Veterans Affairs. The Department of Veterans Affairs must receive the application no later than the last date of the term, quarter, semester, or 6-month period to which all or part of the loan will apply. The application shall be certified by the school as to the date required from the school by the Department of Veterans Affairs.

(Authority: 38 U.S.C. 3471)

(b) Information. The application shall provide the Department of Veterans Affairs with the following information and such other information as may be reasonable upon specific request:

(1) A statement of nontaxable income for the student for the current tax year in which the application is received by the Department of Veterans Affairs; as well as a statement of adjusted gross income for the student for the current tax year in which the application for an education loan is received by the

Department of Veterans Affairs less authorized deductions for exemptions, itemized or standard deduction, whichever is greater, and mandatory withholdings such as Federal and State income taxes, social security taxes, etc.

(2) The amount of all funds of the eligible spouse or surviving spouse on hand on the date of the application including cash on hand, money in a bank or savings and loan association account, and certificates of deposit.

(3) The full amount of the tuition for the course to be paid by the eligible spouse or surviving spouse during the period for which the loan is sought.

(4) The amount of reasonably anticipated expenses for room and board to be expended by the eligible spouse or surviving spouse during the period for which the loan is sought, including a reasonable amount, not to exeed 22.5 cents per mile, for commuting normal distances to classes if the student does not reside on campus. Applications may also provide the Department of Veterans Affairs with a statement of the amount of charges for room and board which the school would have made had the school provided the eligible spouse or surviving spouse with room and board. If the school does not provide room and board, the application may provide the Department of Veterans Affairs with a statement of charges for room and board which the eligible spouse or surviving spouse

would have received had he or she been provided room and board at the nearest State college or State university which provides room and board.

spouse or surviving spouse, as define in §21.4500(e), which may be reasonabl expected to be expended for educatio needs in any academic year or othe loan period.

(2) Subtracting the available re sources determined in paragraph (a)(1 of this section from the actual cost c attendance, as defined in §21.4500(f), t obtain the net amount by which cost exceed the resources available for edu cation needs. If the available resource and the costs are equal, or if the re sources exceed the costs, no loan wil be authorized.

(b) Amount. A loan shall be author ized in the amount of the excess of cos. over available resources as determine in paragraph (a) of this section subjec to the following limitations:

(1) If the costs exceed the availabl resources by $50 or less no loan shall b granted.

(2) The aggregate of the amounts an eligible spouse or surviving spouse ma borrow for an education loan may no exceed $2,500 in any one academic year It also may not exceed an amount de termined by multiplying the number o months of educational assistance t which the eligible spouse or surviving spouse would be entitled were it not fo the expiration of his or her delimiting period under 38 U.S.C. 3511 times $376.

(Authority: 38 U.S.C. 3512(f), 3698)

(3) If a student is enrolled in a course organized on a term, quarter or semes ter basis, no single loan shall be au thorized at one time for a period that is longer than two consecutive quarters. If a student is enrolled in a course not organized on a term, quarter or se mester basis, no single loan shall be authorized at one time for a perio that is longer than 6 months.

(Authority: 38 U.S.C. 3698)

(4) The Department of Veterans Af fairs shall pay the following maximum amounts for these loan periods: (i) $1,250 for any semester.

(ii) $830 for any term of 8 weeks of more leading to a standard college de gree which is not part of the norma academic year or for a quarter.

(iii) $1660 for two consecutive quar ters.

$270 per month for a course not ng to a standard college degree if than 6 months long.

) $1660 for a 6-month loan period d on a course not leading to a dard college degree which is 6 or e months long.

1) $270 per month for a loan period ess than 6 months based on a course leading to a standard college dee which is 6 or more months long.

hority: 38 U.S.C. 3512(f), 3698(b))

No amount authorized will be paid the Department of Veterans Affairs îl the eligible spouse or surviving se is certified as being enrolled actually pursuing the course.

An eligible spouse or surviving se may receive more than one loan ering separate loan periods, subject paragraphs (b)(3) and (b)(7) of this

tion.

If the spouse or surviving spouse s a material change in economic cirmstances subsequent to the original riication for a loan, he or she may pply for an increase in an authori loan or for a loan, if otherwise lified, if no loan was originally nted. However, the Department of erans Affairs will not decrease or cke a loan once granted, absent ad in the application.

FR 31765, July 29, 1975, as amended at 48 1996. Aug. 22, 1983: 49 FR 8439, Mar. 7, : 50 FR 19936, May 13, 1985; 61 FR 26116, =24. 1996]

4504 Promissory note.

A) General. The agreement by VA to an money pursuant to 38 U.S.C. 3f) and 3698 to any eligible spouse or viving spouse shall be in the form of romissory note which shall include: The full amount of the loan.

2) Agreement to pay a fee not to exed 3 percent for an insurance fund inst defaults.

3) A note or other written obligation widing for repayment of the prinal amount, and interest on the loan annual installments over a period inning 9 months after the date on ich the borrower first ceases to be at st a half-time student and ending: For loans of $600 or more, 10 years d9 months after such date, or

(ii) For loans of less than $600, 1 year and 7 months after such date for the first $50 of the loan plus 1 additional month for each additional $5 of the loan.

(4) A provision for prepayment of all or part of the loan, without penalty, at the option of the borrower.

(b) Interest. The promissory note shall advise the student that the loan shall bear interest on the unpaid balance of the loan at a rate comparable to, but not in excess of, the rate of interest charged students at such time on loans insured by the Secretary of Education, Department of Education, under part B of Title IV of the Higher Education Act of 1965. The rate shall be determined as of the date the agreement is executed and shall be a fixed amount.

(Authority: 38 U.S.C. 3698)

(c) Security. The loan shall be made without security and without endorsement.

(d) Default. Whenever VA determines that a default, in whole or in part, has occurred on any such loan the eligible spouse or surviving spouse shall be notified that the amount of the default shall be recovered from the eligible spouse or surviving spouse concerned in the same manner as other debt due the United States. Once a default has occurred, the eligible spouse's or surviving spouse's subsequent reentrance into training at the half-time or greater rate shall not be the basis for rescinding the default. A default may only be rescinded when VA has been led to create the default as a result of a mistake of fact or law.

(Authority: 38 U.S.C. 3698 (e)(1))

(e) Death or disability. If the eligible spouse or surviving spouse dies or becomes permanently and totally disabled, even though he or she ceases to be permanently and totally disabled subsequent to the granting of the loan, the remaining liability of such person for an educational loan shall be discharged.

(f) Fraud. Material misrepresentation of fact by the eligible spouse or surviving spouse, including omissions of relevant information, shall render the

loan agreement null and void. The deferred payment provisions of the agreement shall not apply in such a case and the full amount of any loan balance shall become due and payable immediately. The amount due shall be recovered from the eligible spouse or surviving spouse in the same manner as any other debt due the United States.

(g) Signature. An eligible spouse or surviving spouse may sign both the loan application and the promissory note required and payment of the amounts authorized will be made to such person, notwithstanding his or her minority, unless the person has a legal guardian. In such cases the legal guardian must sign and will be paid the loan amounts.

[40 FR 31765, July 29, 1975, as amended at 48 FR 37997, Aug. 22, 1983: 52 FR 5963, Feb. 27, 1987; 52 FR 7276, Mar. 10, 1987; 61 FR 26116, May 24, 1996]

$21.4505 Check delivery.

(a) General. Education loans by the Department of Veterans Affairs shall be made by a check payable to the eligible spouse or surviving spouse and shall be mailed promptly to the educational institution in which the eligible spouse or surviving spouse is enrolled for delivery by the educational institution.

(b) Delivery and certification. (1) The educational institution, electing to participate in this program, shall deliver an education loan check to the eligible spouse or surviving spouse and shall certify the fact of delivery to the Department of Veterans Affairs immediately upon delivery. If the delivery is not made within 30 days after the institution receives the check, it shall return the check to the Department of Veterans Affairs.

(2) The Director of the Department of Veterans Affairs facility of jurisdiction may direct that education loan checks be sent directly to spouses or surviving spouses when:

(i) The educational institution demonstrates an inability to comply with these requirements; or

(ii) The educational institution fails to provide adequately for the safekeeping of the checks prior to the delivery to the student or return to the Department of Veterans Affairs; or

(iii) The educational institution elects not to participate in this pro gram; or

(iv) There is compelling evidence that the institution is unable to dis charge its responsibilities under thi program.

(Authority: 38 U.S.C. 3512(f), 3698)

[44 FR 62508. Oct. 31, 1979, as amended at 6 FR 26116, May 24, 1996]

$21.4507 Advertising.

(a) General. No educational institu tion or training establishment shall in clude a statement in advertisements of brochures intended to solicit students as to the availability of education loans from the Department of Veterans Affairs for eligible spouses and surviving spouses, except as provided ir paragraph (b) of this section.

(b) Form. The statement which is per mitted shall be as follows: "Certain eli gible spouses and surviving spouses may qualify for a maximum educational loan of $2,500 per academic year from the Department of Veterans Affairs depending upon need. Applica tions for such loans shall be made to the Department of Veterans Affairs or forms prescribed by it."

(Authority: 38 U.S.C. 3512(f), 3696, 3698(b)) [44 FR 62510, Oct. 31, 1979, as amended at 61 FR 26116, May 24, 1996]

Subparts F-1-F-3 [Reserved]

Subpart G-Post-Vietnam Era Veterans' Educational Assistance Under 38 U.S.C. Chapter 32

AUTHORITY: 38 U.S.C. 501(a), chs. 32, 36, unless otherwise noted.

SOURCE: 45 FR 31, Jan. 2, 1980, unless other wise noted.

ADMINISTRATIVE

$21.5001 Administration of benefits: 38 U.S.C. Chapter 32.

(a) Delegation of authority. Except as otherwise provided, authority is delegated to the Under Secretary for Benefits and to supervisory or administrative personnel within the jurisdiction of the Education Service, Veterans Benefits Administration, designated by

him or her to make findings and decisions under 38 U.S.C. Chapter 32 and the applicable regulations, precedents, and instructions, as to the program authorized by subpart G of this part.

Authority: 38 U.S.C. 512(a))

(b) Administrative provisions. In administering benefits payable under 38 U.S.C. Chapter 32, VA will apply the following sections:

(1) Section 21.4002-Finality of decisions;

(2) Section 21.4003 (except paragraphs (d) and (e))-Revision of decisions;

(3) Section 21.4005-Conflicting interests;

(4) Section 21.4006-False or misleading statements;

(5) Section 21.4007-Forfeiture; (6)

Section 21.4008-Prevention of Overpayments; and

(7) Section 21.4009 Overpayments; waiver or recovery.

Authority: 38 U.S.C. 3241(a), 3680, 3683, 3685, 3690, 6103)

[61 FR 29029, June 7, 1996]

GENERAL

$21.5020 Post-Vietnam era veterans'

educational assistance.

Title 38 U.S.C. Chapter 32 provides for a participatory program for educational assistance benefits to eligible veterans and servicepersons. The intent of the Congress for this program is stated in 38 U.S.C. 3201. (Authority: 38 U.S.C. 3201) 161 FR 29029, June 7, 1996]

$21.5021 Definitions.

For the purpose of subpart G and payment of Chapter 32 benefits the following definitions apply:

(a) Veteran-means anyone whose service meets the requirements of $21.5040.

(Authority: 38 U.S.C. 3202(1))

(b) Active duty-means full-time duty in the Armed Forces or as a commissioned officer of the regular or Reserve Corps of the Public Health Service or of the National Oceanic and Atmospheric Administration. It does not in

clude any period during which an individual:

(1) Was assigned full-time by the Armed Forces to a civilian institution for a course of education which was substantially the same as established courses offered to civilians,

(2) Served as a cadet or midshipman at one of the service academies,

(3) Served under the provisions of section 511(d) of Title 10, United States Code, pursuant to an enlistment in the military reserve or national guard,

(4) Served in an excess leave without pay status, or

(5) Served in a status specified in §3.15 of this chapter.

(Authority: 38 U.S.C. 3202)

(c) State-means each of the several States, territories and possessions of the United States, the District of Columbia, the Commonwealth of Puerto Rico and the Canal Zone.

(Authority: 38 U.S.C. 101(20))

(d) School, educational institution, institution. The terms, school, educational institution, and institution mean

(1) Any vocational school, business school, correspondence school, junior college, teacher's college, college, normal school, professional school, university or scientific or technical institution;

(2) Any public or private elementary school or secondary school which offers courses for adults; and

(3) An entity, other than an institution of higher learning, that provides training required for completion of a State-approved alternative teacher certification program.

(Authority: 38 U.S.C. 3202(2), 3452(c))

(e) Participant-means a person who is participating in the educational benefits program established under Chapter 32. This includes:

(1) A person who has enrolled in and is making contributions by monthly payroll deduction to the fund.

(2) Those individuals who have contributed to the fund and have not disenrolled (i.e., users or potential users of benefits).

(Authority: 38 U.S.C. 3202)