2

1 provisions of this chapter, by a lending institution authorized 2 to do business in a State or in the District of Columbia may,

3 with the approval of the Administrator, be guaranteed by the

4 United States, as provided in this subchapter.

5

6

"§ 1691. Terms and conditions of loans

"(a) Any loan guaranteed under this subchapter may 7 be approved by the Administrator only if the eligible veteran 8 (1) is capable, in the opinion of the educational institution 9 in which his program is to be pursued, of maintaining good 10 standing in his courses of study, (2) has been accepted for 11 enrollment, or is enrolled, in such institution either as an 12 undergraduate, graduate, or professional student, and (3) 13 is enrolled in or is pursuing a program of education on a 14 half-time or more basis. The amount of any loan guaranteed 15 under this subchapter shall not, for any year of educational pursuit approved under this chapter, exceed (1) an amount 17 equal to the amount of the educational assistance allowance 18 which the eligible veteran is entitled to receive, or (2) an 19 amount which, when added to the amount of the educational 20 assistance allowance the eligible veteran is entitled to receive, 21 is reasonably adequate, as determined by the Administrator, 22 to meet the veteran's educational expenses at the institution

16

23 in which he is enrolled, whichever amount is the lesser.

2 2 2 15

24

25

"(b) An approved loan shall be evidenced by a note

or other written agreement which provides for repayment of

3

1 the principal amount, together with interest thereon, in equal 2 installments (or, if the borrower so requests, in graduated 3 periodic installments determined in accordance with such 4 schedules as may be approved by the Administrator) pay5 able quarterly, bimonthly, or monthly (at the option of the 6 lending institution), over a period beginning nine months 7 after the date on which the eligible veteran ceases to pursue 8 an educational program authorized under this chapter (on at 9 least a one-half time or more basis), and ending not later 10 than ten years and nine months after such date. Such loan 11 shall bear interest on the unpaid balance at the rate deter12 mined by the Administrator to be the going rate in the State 13 in which the loan is made, except that all interest in excess of 3 14 per centum per annum shall be paid by the United States

15

under the guaranty agreement entered into between the lend16 ing institution and the Administrator.

17 "§ 1692. Cancellation of loans

18

20

21

"Not to exceed 50 per centum of any approved guaranteed loan (plus interest) shall be canceled for services as a full-time teacher in a public or other nonprofit elementary or secondary school in a State, in an institution of higher edu22 cation, or in an elementary or secondary school overseas 23 of the Armed Forces of the United States. Cancellation of 24 a loan for such service shall be (1) at the rate of 10 per 25 centum of the total amount of such loan plus interest thereon

4

1

for each complete academic year or its equivalent (as deter

2 mined under regulations of the Administrator) of such serv

3 ice, (2) at the rate of 15 per centum of the total amount of

4

5

6

7

such loan plus interest thereon for each complete academic

year or its equivalent (as determined under regulations of the

Administrator) of service as a full-time teacher in a public

or other nonprofit elementary or secondary school which is 8 in the school district of a local educational agency which is

9

eligible in such year for assistance pursuant to title II of 10 Public Law 874, Eighty-first Congress, as amended, and 11 which for purposes of this clause and for that year has been 12 determined by the Administrator, pursuant to regulations 13 and after consultation with the State educational agency of 14 the State in which the school is located, to be a school in 15 which there is a high concentration of students from low16 income families, except that the Administration shall not 17 make such determination with respect to more than 25 per 18 centum of the total of the public and other nonprofit ele19 mentary and secondary schools in any one State for any one 20 year, or (3) at the rate of 15 per centum of the total amount 21 of such loan plus interest thereon for each complete academic 22 year or its equivalent (as determined under regulations of 23 the Administrator) of service as a full-time teacher of handi24 capped children (including mentally retarded, hard of hear25 ing, deaf, speech impaired, visually handicapped, seriously

5

1 emotionally disturbed, or other health impaired children who 2 by reason thereof require special education) in a public or 3 other nonprofit elementary or secondary school system. An 4 additional 50 per centum of any such loan plus interest 5 thereon may be canceled at the rate of 15 per centum of the 6 total amount of the loan plus interest thereon for additional 7 service of the nature described in clauses (1) and (2) of 8 the preceding sentence; but nothing in this paragraph shall 9 authorize refunding any payment made by a veteran. The 10 amount of the loan which is canceled under this section shall 11 be paid to the lending institution by the United States pur12 suant to the guaranty agreement entered into between such 13 institution and the Administrator.

14 "8 1693. Powers of the Administrator

15

"The Administrator is authorized to prescribe such addi16 tional terms and conditions as he deems necessary in order 17 to implement the provisions of this subchapter, and to take 18 such action as may be necessary to recover the unpaid balance 19 of any loan which is defaulted by the borrower and for which 20 the United States becomes responsible pursuant to the guar

21 anty provisions of this subchapter.

22 "§ 1694. Direct educational loans

222

23 "(a) Whenever the Administrator finds that eligible 24 veterans are unable to obtain educational assistance loans

6

1 under this subchapter from commercial lending sources at 2 reasonable rates of interest and on reasonable terms and con3 ditions, he is authorized to make educational assistance loans 4 to such veterans on the same terms and conditions prescribed 5 for loans guaranteed under this subchapter except that such 6 loans shall bear interest on the unpaid balance at the rate of 7 3 per centum per annum. No interest shall accrue before the 8 date on which repayment of the loan is to begin.

9

"(b) For the purpose of enabling the Administrator to 10 carry out the provisions of this section, there is established

11

an educational assistance revolving loan fund, and there is 12 authorized to be appropriated to such fund an amount not 13 to exceed $250,000,000. Any funds received by way of re14 payment of loans made under this section shall be credited to the revolving fund.

15

16 "§ 1695. Repayment or cancellation of loans by the United States; limitation on loans from Federal sources

17

18

"(a) Notwithstanding any other provision of law, when

19 ever an eligible veteran is obligated for the repayment of a 20 loan guaranteed or made under this subchapter and is recalled 21 to active duty for a period of more than thirty days, the 22 Administrator shall pay on behalf of such veteran any pay23 ment, including interest thereon, on any loan guaranteed 24 under this subchapter which becomes due while such veteran