Savings Opportunity and Affordable Repayment Act

Today's wording of each part of the law, with what would be struck out and added. Each change also gives the bill's own instruction, word for word.

1. 20 U.S.C. 1001(iv)changedby H.R. 8475 Sec. 2(a)

   The bill says: in clause (iv), by striking "and" after the semicolon;

   Bill text · Current law (20 U.S.C. 1001)

2. 20 U.S.C. 1001(v)changedby H.R. 8475 Sec. 2(a)

   The bill says: in clause (v), by striking the period at the end and inserting "; and"; and

   Bill text · Current law (20 U.S.C. 1001)

3. 20 U.S.C. 1001added (vi)by H.R. 8475 Sec. 2(a)

   (vi) beginning on the date that is 180 days after the date of enactment of the Savings Opportunity and Affordable Repayment Act, an income contingent repayment plan known as the "Savings Opportunity and Affordable Repayment plan", consistent with section 493E.

   The bill says: by adding at the end the following:

   Bill text · Current law (20 U.S.C. 1001)

4. 20 U.S.C. 1001changedby H.R. 8475 Sec. 2(a)

   The bill says: in the first sentence, by striking "or income-based" and inserting "income-based, or income contingent Savings Opportunity and Affordable Repayment (consistent with section 493E)"; and

   Bill text · Current law (20 U.S.C. 1001)

5. 20 U.S.C. 1001changedby H.R. 8475 Sec. 2(a)

   The bill says: in the second sentence, by striking "or income-based" and inserting "income-based, or income contingent Savings Opportunity and Affordable Repayment";

   Bill text · Current law (20 U.S.C. 1001)

6. 20 U.S.C. 1001(1)changedby H.R. 8475 Sec. 2(a)

   (D) except as provided in paragraph (6), an income contingent repayment plan—(i) with varying annual repayment amounts based on the income of the borrower, paid over an extended period of time prescribed by the Secretary, not to exceed 25 years, except that the plan described in this clause shall not be available to the borrower of a Federal Direct PLUS loan made on behalf of a dependent student; and(ii) which, beginning on the date that is 180 days after the date of enactment of the Savings Opportunity and Affordable Repayment Act, shall include the "Savings Opportunity and Affordable Repayment plan", consistent with section 493E; and

   The bill says: in paragraph (1), by striking subparagraph (D) and inserting the following:

   Bill text · Current law (20 U.S.C. 1001)

7. 20 U.S.C. 1001added (6)by H.R. 8475 Sec. 2(a)

   (6) Phase outs.—(A) PAYE repayment plan.—(i) In general.— A borrower may choose the Pay As You Earn Repayment Plan, as described in section 685.209 of title 34, Code of Federal Regulations (as in effect on January 19, 2025), as an income contingent repayment plan pursuant to paragraph (1)(D)—(I) before the date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act, only if the borrower—(aa) has loans eligible for repayment under such plan, as described in such section as in effect on such date; and(bb) has a partial financial hardship when the borrower initially enters such plan, as described in such section as in effect on such date; and(II) on or after the date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act, only if the borrower meets the conditions described in subclause (I) and was repaying a loan under such plan before such date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act.(ii) Prohibition against re-enrollment.— Beginning on the date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act, a borrower who was repaying a loan under the Pay As You Earn Repayment Plan, as described in clause (i), and changes to a different repayment plan may not re-enroll in the Pay As You Earn Repayment Plan.(B) Income contingent repayment plan.—(i) In general.— A borrower may choose the ICR plan, as described in section 685.209 of title 34, Code of Federal Regulations (as in effect on January 19, 2025), as an income contingent repayment plan pursuant to paragraph (1)(D)—(I) before the date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act, only if the borrower has loans eligible for repayment under such plan, as described in such section as in effect on such date, except as provided in clause (iii); and(II) on or after the date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act, only if the borrower has loans eligible for repayment under such plan, as described in such section as in effect on such date, except as provided in clause (iii), and was repaying a loan under such plan before such date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act.(ii) Prohibition against re-enrollment.— Beginning on the date that is 2 years after the date of enactment of the Savings Opportunity and Affordable Repayment Act, a borrower who was repaying a loan under the ICR plan, as described in clause (i), and changes to a different repayment plan may not re-enroll in the ICR plan.(iii) Eligible loans for purposes of ICR repayment.— In addition to the loans eligible for repayment under the ICR plan as described in section 685.209 of title 34, Code of Federal Regulations (as in effect on January 19, 2025), an eligible loan for purposes of repayment under the ICR plan may include—(I) a Federal Direct PLUS Loan made on behalf of a dependent student;(II) a Federal Direct Consolidation Loan for which the proceeds were used to discharge the liability on a Federal Direct PLUS Loan or a loan under section 428B made on behalf of a dependent student;(III) a loan under section 428B made on behalf of a dependent student; or(IV) a loan under section 428C for which the proceeds were used to discharge the liability on a Federal Direct PLUS Loan or a loan under section 428B made on behalf of a dependent student.

   The bill says: by adding at the end the following:

   Bill text · Current law (20 U.S.C. 1001)

8. 20 U.S.C. 1001added 493Eby H.R. 8475 Sec. 2(a)

   493E. Savings Opportunity and Affordable Repayment plan.—(a) Definitions.— In this section:(1) Eligible loan.— The term eligible loan means a loan made, insured, or guaranteed under part B or D.(2) Monthly payment obligation.—(A) In general.— The term monthly payment obligation, when used with respect to a borrower, means that for such borrower the monthly payment amount due on the total amount of eligible loans made to such borrower that is equal to, except as provided in subparagraph (B)—(i) $0 for the portion of the borrower's, and the borrower's spouse's (if applicable), adjusted gross income (as defined in section 62 of the Internal Revenue Code of 1986) that is less than or equal to 250 percent of the poverty line applicable to the borrower's family size as determined under section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)); plus(ii) 5 percent of the portion of the borrower's, and the borrower's spouse's (if applicable), adjusted gross income (as defined in section 62 of the Internal Revenue Code of 1986) that is greater than 250 percent of the poverty line applicable to the borrower's family size as determined under section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)), prorated by the percentage that is the result of dividing the borrower's original total loan balance attributable to eligible loans received for the borrower's undergraduate study by the original total loan balance attributable to all eligible loans, divided by 12; plus(iii) for loans not subject to clause (ii), 10 percent of the portion of the borrower's, and the borrower's spouse's (if applicable), adjusted gross income (as defined in section 62 of the Internal Revenue Code of 1986) that is greater than 250 percent of the poverty line applicable to the borrower's family size as determined under section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)), prorated by the percentage that is the result of dividing the borrower's original total loan balance minus the original total loan balance of loans subject to clause (ii) by the borrower's original total loan balance attributable to all eligible loans, divided by 12.(B) Minimal payment obligation.— If the calculation of the monthly payment amount due under subparagraph (A) for a borrower is—(i) less than $5, then the monthly payment obligation for such borrower is equal to $0; and(ii) equal to or greater than $5 but less than $10, then the monthly payment obligation for such borrower is equal to $10.(b) Savings Opportunity and Affordable Repayment authorized.— Notwithstanding any other provision of this Act, the Secretary shall carry out a Savings Opportunity and Affordable Repayment plan program that complies with the following:(1) A borrower of any eligible loan may elect to have the borrower's aggregate monthly payment for all such loans not exceed the monthly payment obligation of such borrower.(2) The holder of such eligible loan shall apply—(A) 50 percent of the borrower's monthly payment under this subsection toward outstanding principal; and(B) 50 percent of the borrower's monthly payment under this subsection—(i) first toward accrued charges and collection costs on the loan;(ii) then toward outstanding interest; and(iii) then toward outstanding principal.(3) During all periods of repayment on all loans being repaid under the Savings Opportunity and Affordable Repayment plan, the Secretary shall not charge the borrower's account any accrued interest that is not covered by the borrower's monthly payment obligation.(4) Any principal due and not paid under paragraph (2) shall be deferred.(5) In the case of a borrower repaying under the Savings Opportunity and Affordable Repayment plan, the Secretary shall cancel the remaining balance due on all eligible loans for a borrower in the case the borrower—(A) is repaying only eligible loans received for undergraduate study in a program that is not more than a 2-year program of study, or a consolidation loan that repaid only loans received for such study, after the borrower has satisfied 120 monthly payments or the equivalent (as described in paragraph (6)), over a period of at least 10 years; and(B) is repaying at least one eligible loan not described in subparagraph (A), after the borrower has satisfied 180 monthly payments or the equivalent (as described in paragraph (6)), over a period of at least 15 years.(6) A monthly payment or the equivalent shall be satisfied by any of the following:(A) A month in which the borrower—(i) makes a monthly payment that is equal to not less than the monthly payment obligation of the borrower; or(ii) has a monthly payment obligation of $0.(B) A month in which the borrower receives a deferment or forbearance of repayment under any of the following:(i) A cancer treatment deferment under section 455(f)(3).(ii) A rehabilitation training program deferment.(iii) An unemployment deferment.(iv) An economic hardship deferment, which includes volunteer service in the Peace Corps as an economic hardship condition.(v) A military service deferment.(vi) A post-active duty student deferment.(vii) A national service forbearance.(viii) A National Guard duty forbearance.(ix) A Department of Defense Student Loan Repayment forbearance.(x) An administrative forbearance under a period—(I) during which the Secretary has authorized forbearance due to a national military mobilization or other local or national emergency;(II) necessary for the Secretary to collect and process documentation supporting the borrower's request for a deferment, forbearance, change in repayment plan, or consolidation loan; or(III) determined necessary by the Secretary.(xi) A bankruptcy forbearance if the borrower made the required payments on a confirmed bankruptcy plan.(C) A month in which the borrower receives a deferment or forbearance of repayment not described in subparagraph (B), but for which the borrower makes an

   The bill says: by inserting after section 493D the following:

   Bill text · Current law (20 U.S.C. 1001)

9. 20 U.S.C. 1001changedby H.R. 8475 Sec. 2(a)

   The bill says: in the matter preceding clause (i), by inserting "or a Savings Opportunity and Affordable Repayment plan for a loan under part B" after "part D"; and

   Bill text · Current law (20 U.S.C. 1001)

10. 20 U.S.C. 1001(ii)(I)changedby H.R. 8475 Sec. 2(a)

    The bill says: in clause (ii)(I), by inserting "or section 493E(c)(2)(B)" after "section 493C(c)(2)(B)".

    Bill text · Current law (20 U.S.C. 1001)

From the bill's official text on GovInfo and the U.S. Code, latest edition, which may not yet show changes made since.