S. 1541 would amend title IV of the Higher Education Act of 1965 to authorize private education loan refinancing under the Federal student loan program.
Detailed Summary
Private Student Loan Debt Swap Act of 2009 - Amends title IV (Student Assistance) of the Higher Education Act of 1965 to direct the Secretary of Education to implement a Private Education Loan Debt Swap program.
Requires the Secretary, under such program, to refinance the private education loans of certain borrowers who: (1) after July 1, 1994, were eligible for unsubsidized Stafford Loans under the Federal Family Education Loan (FFEL) program, or, after July 1, 2006, were eligible for FFEL PLUS Loans for graduate or professional education; (2) are not in default on a loan made, insured, or guaranteed under title IV; and (3) have made at least two consecutive payments on the private education loan to be refinanced and are not more than 90 days delinquent on such loan.
Makes the program applicable only to private education loans incurred after July 1, 1994, and before July 1, 2010, which were used for the cost of enrolling at institutions of higher education eligible to participate in title IV programs.
Sets the interest rate on such refinanced loans at the rate applicable to: (1) unsubsidized Stafford loans, for borrowers who were eligible for such loans; and (2) Federal Direct PLUS loans, for borrowers who were eligible for those loans.
Gives refinanced loans the same repayment terms, conditions, and benefits as Consolidation Loans under the Direct Loan program.
Directs the Secretary carry out a national awareness campaign on the availability and benefits of refinancing private education loans under this program.
Status of the Legislation
Latest Major Action: 7/30/2009: Referred to Senate committee. Status: Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
Points in Favor
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Points Against
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Visitor Comments
ForThePeople
August 27, 2009, 12:08pm (report abuse)Its about time someone is doing something about the ridiculous restrictions and rules that harm private student loan borrowers. An option to consolidate with Fed Direct will help alievaite the hardship that is caused to many borrowers by private lenders. Please support this bill. Please contact your Senators and Congressmen and Congresswomen and ask them to please support this bill.