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ED/OPE RIN: 1840-AD26 Publication ID: Fall 2017 
Title: Borrower Defense and Related Issues 
Abstract:

The Secretary plans to establish new regulations governing the William D. Ford Federal Direct Loan (Direct Loan) Program regarding the standard and the process for determining whether a borrower has a defense to repayment on a loan based on an act or omission of a school. We also may amend other sections of the Direct Loan Program regulations, including those that codify our current policy regarding the impact that discharges have on the 150 percent Direct Subsidized Loan Limit; and the Student Assistance General Provisions regulations providing the financial responsibility standards and disclosure requirements for schools. In addition, we may amend the discharge provisions in the Federal Perkins Loan (Perkins Loan), Direct Loan and Federal Family Education Loan (FFEL) program regulations.

 
Agency: Department of Education(ED)  Priority: Economically Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Proposed Rule Stage 
Major: Yes  Unfunded Mandates: No 
EO 13771 Designation: Other 
CFR Citation: 34 CFR 30    34 CFR 668    34 CFR 674    34 CFR 682    34 CFR 685    34 CFR 686    and other sections as applicable     (To search for a specific CFR, visit the Code of Federal Regulations.)
Legal Authority: 20 U.S.C. 1082(a)(5), (a)(6)    20 U.S.C.1087(a)    20 U.S.C. 1087e(h)    20 U.S.C. 1221e-3    20 U.S.C. 1226a-1    20 U.S.C. 1234(a)    31 U.S.C. 3711   
Legal Deadline:  None

Statement of Need:

The Secretary is initiating negotiated rulemaking to revise current regulations governing borrower defenses to loan repayment.

 

Summary of the Legal Basis:

Section 492 of the HEA requires that, before publishing any proposed regulations to implement programs authorized under title IV of the HEA, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations from the public, the Secretary conducts negotiated rulemaking to develop the proposed regulations. Section 455(h) of the Higher Education Act of 1965, as amended (HEA), 20 U.S.C. 1087e(h), authorizes the Secretary to specify in regulation which acts or omissions of an institution of higher education a borrower may assert as a defense to repayment of a Direct Loan. 

Alternatives:

These will be identified through the negotiated rulemaking process, presented in a Notice of Proposed Rulemaking, and discussed in the Final Regulations.

Anticipated Costs and Benefits:

These will be identified through the negotiated rulemaking process, in a Notice of Proposed Rulemaking and discussed in the Final Regulations.

Risks:

These will be identified through the negotiated rulemaking process, in a Notice of Proposed Rulemaking and discussed in the Final Regulations.

Timetable:
Action Date FR Cite
Notice of Intention to Commence Negotiated Rulemaking  06/16/2017  82 FR 27640   
NPRM  05/00/2018 
Regulatory Flexibility Analysis Required: Undetermined  Government Levels Affected: Federal, Local, State 
Small Entities Affected: Businesses, Governmental Jurisdictions  Federalism: Undetermined 
Included in the Regulatory Plan: Yes 
RIN Information URL: www.regulations.gov   Public Comment URL: www.regulations.gov  
RIN Data Printed in the FR: No 
Agency Contact:
Annmarie Weisman
Department of Education
Office of Postsecondary Education
400 Maryland Avenue SW, Room 287-25,
Washington, DC 20202
Phone:202 453-6712
Email: annmarie.weisman@ed.gov