,i  #aacth ,,congress  #ast ,session    
,h4 ,r4 #accj  ,,in ,,the ,,house ,,of  
,,representatives  ,march #ba1 #bjac    
,ms4 ,bass 7for herself1 ,ms4 ,wilson of
 ,florida1 ,mr4 ,hinojosa1 ,ms4 ,fudge1 
,mrs4 ,christensen1 ,ms4 ,clarke1 ,mr4  
,al ,green of ,texas1 ,mr4 ,payne1 ,mr4 
,johnson of ,georgia1 ,mr4 ,clyburn1    
,mr4 ,clay1 ,mr4 ,watt1 ,mr4 ,cleaver1  
,mr4 ,danny ,k4 ,davis of ,illinois1    
,mr4 ,hastings of ,florida1 ,mr4 ,scott 
of ,virginia1 ,ms4 ,lee of ,california1 
,mr4 ,richmond1 ,mr4 ,lewis1 ,ms4 ,brown
 of ,florida1 ,ms4 ,edwards1 ,mr4       
,conyers1 ,ms4 ,norton1 ,ms4 ,jackson   
,lee1 ,mr4 ,rangel1 ,ms4 ,bordallo1 ,mr4
 ,sablan1 ,ms4 ,moore1 ,mr4 ,ryan of    
,ohio1 ,mr4 ,gene ,green of ,texas1 ,mr4
 ,jeffries1 ,mr4 ,schiff1 ,mr4 ,bishop  
of ,georgia1 ,ms4 ,lofgren1 ,ms4        
,brownley of ,california1 and ,mr4      
,ellison7 introduced the following bill2
 which was referred to the ,committee on
 ,education and the ,workforce1 and in  
addition to the ,committees on          

,financial ,services and ,ways and      
,means1 for a period to be subsequently 
determined by the ,speaker1 in each case
 for consideration of such provisions as
 fall within the jurisdiction of the    
committee concerned  ,a ,,bill  ,to     
increase purchasing power1 strengthen   
economic recovery1 and restore fairness 
in financing higher education in the    
,united ,states through student loan    
forgiveness1 caps on interest rates on  
,federal student loans1 and refinancing 
opportunities for private borrowers1 and
 for other purposes4  #a4 ,short title  
,this ,act may be cited as the ,student 
,loan ,fairness ,act4  #b4 ,findings    
,congress finds the following3  7#a7 ,a 
well-educated citizenry is critical to  
our ,nation's ability to compete in the 
global economy4  7#b7 ,the ,federal     
,government has a vested interest in    
ensuring access to higher education4    
7#c7 ,higher education should be viewed 
as a public good benefitting our country
 rather than as a commodity solely      

benefitting individual students4  7#d7  
,recently1 total outstanding student    
loan debt officially surpassed total    
credit card debt in the ,united ,states 
in #bjaj1 and is on track to exceed     
#a1jjj1jjj1jjj1jjj4  7#e7 ,excessive    
student loan debt is impeding economic  
growth in the ,united ,states4 ,faced   
with excessive repayment burdens1 many  
individuals are unable to start         
businesses1 invest1 or buy homes4       
,relieving student loan debt would give 
these individuals greater control over  
their earnings and would increase       
entrepreneurship and demand for goods   
and services4  7#f7 ,because of soaring 
tuition costs1 students often have no   
choice but to amass significant debt to 
obtain an education that is widely      
considered a prerequisite for earning a 
living wage4  7#g7 ,amidst rising       
tuition rates and stagnant grant        
funding1 many students are forced to    
supplement ,federal loans with private  
loans1 which frequently feature higher  

interest rates with fewer consumer      
protections4  7#h7 ,a borrower who      
experiences an extended hardship for    
whatever reason1 or a borrower who      
experiences a series of separate        
hardships over a longer period of time1 
will often have no choice but to default
 on his or her private student loans4   
,opportunities to put such private loans
 into forbearance are limited4  7#i7    
,during the period of forbearance on    
private student loans1 interest         
continues to accrue and is capitalized1 
and once the borrower comes out of      
forbearance1 he or she owes             
significantly more on the principal of  
the loan than before the hardship period
 began4  #c4 #aj_/aj ,loan ,repayment   
and ,forgiveness ,part ,g of title ,,iv 
of the ,higher ,education ,act of #aife 
is amended by adding at the end the     
following3  #dic;,e4 #aj_/aj ,loan      
,repayment and ,forgiveness  7a7 #aj_/aj
 ,loan ,repayment ,plan  7#a7 #aj_/aj   
,loan ,repayment ,plan authorized       

,notwithstanding any other provision of 
this ,act1 the ,secretary shall carry   
out a program 7to be known as the       
#aj_/aj ,loan ,repayment ,plan7 under   
which--  7,a7 a borrower of an eligible 
loan who is eligible under paragraph    
7#c7 may elect to have the borrower's   
aggregate monthly payment for all such  
loans not exceed the monthly payment    
amount described in paragraph 7#b72     
7,b7 any interest due and not paid under
 a monthly payment under this           
subsection--  7i7 shall continue to     
accrue2 and  7ii7 shall be capitalized  
up to an amount equal to #aj percent of 
the original principal amount of all the
 eligible loans that the borrower is    
repaying under this subsection2  7,c7   
any principal due and not paid under a  
monthly payment under this subsection   
shall be deferred1 and shall be forgiven
 in accordance with subsection 7b7 if   
the borrower meets the requirements for 
forgiveness under such subsection2  7,d7
 the amount of time the borrower makes  

monthly payments under this subsection  
may exceed #aj years2  7,e7 a borrower  
who is repaying an eligible loan        
pursuant to #aj_/aj ,loan ,repayment    
under this subsection may elect1 at any 
time1 to terminate repayment pursuant to
 #aj_/aj ,loan ,repayment and repay such
 loan under the standard repayment plan1
 in which case the amount of time the   
borrower is permitted to repay such     
loans may exceed #aj years2 and  7,f7   
the special allowance payment to a      
lender calculated under section         
#dch7;b77#b77;,i71 when calculated for a
 loan in repayment under this section1  
shall be calculated on the principal    
balance of the loan and on any accrued  
interest unpaid by the borrower in      
accordance with this section4  7#b7     
#aj_/aj ,loan ,repayment monthly payment
 formula ,a borrower who has elected to 
participate in the #aj_/aj ,loan        
,repayment ,plan under this subsection  
shall1 during each month the borrower is
 participating in such ,plan1 make a    

monthly payment in an amount equal to-- 
7,a7 one-twelfth of the amount that is  
#aj percent of the result obtained by   
calculating1 on at least an annual      
basis1 the amount by which--  7i7 the   
borrower's1 and the borrower's spouse's 
7if applicable71 adjusted gross income2 
exceeds  7ii7 #aej percent of the       
poverty line applicable to the          
borrower's family size as determined    
under section #fgc7b7 of the ,community 
,services ,block ,grant ,act 7#db       
,u4,s4,c4 #iijb7b772 or  7,b7 in the    
case of a borrower who is in deferment  
due to an economic hardship described in
 section #dce7o71 #j4  7#c7 ,eligibility
 ,the ,secretary shall establish        
procedures for annually determining the 
borrower's eligibility for #aj_/aj ,loan
 ,repayment1 including verification of a
 borrower's annual adjusted gross income
 and the annual amount due on the total 
amount of eligible loans1 and such other
 procedures as are necessary to         
effectively implement #aj_/aj ,loan     

,repayment under this subsection4  7#d7 
,special rule for married borrowers     
filing separately ,in the case of a     
married borrower who files a separate   
,federal income tax return1 the         
,secretary shall calculate the amount of
 the borrower's #aj_/aj ,loan ,repayment
 under this subsection solely on the    
basis of the borrower's student loan    
debt and adjusted gross income4  7b7    
#aj_/aj ,loan ,forgiveness  7#a7 ,in    
general ,the ,secretary shall carry out 
a program 7to be known as the #aj_/aj   
,loan ,forgiveness ,program7 to forgive 
a qualified loan amount1 in accordance  
with paragraph 7#c71 on an eligible loan
 for a borrower who1 after the date that
 is #aj years prior to the date of      
enactment of the ,student ,loan         
,fairness ,act1 has made #abj monthly   
payments on the eligible loan pursuant  
to any one or a combination of the      
following3  7,a7 ,monthly payment under 
the #aj_/aj ,loan ,repayment ,plan under
 subsection 7a74  7,b7 ,monthly payment 

under any other repayment plan          
authorized under part ,b or ,d of an    
amount that1 for a given month1 is not  
less than the monthly payment amount    
calculated under subsection 7a7 that the
 borrower would have owed in the year in
 which such payment was made1 based on  
the borrower's adjusted gross income and
 eligible loan balance for such year4   
7,c7 ,for any month after such date     
during which the borrower is in         
deferment due to an economic hardship   
described in section #dce7o71 monthly   
payment of #j4  7#b7 ,method of loan    
forgiveness ,to provide loan forgiveness
 under paragraph 7#a71 the ,secretary is
 authorized to carry out a program--    
7,a7 through the holder of the loan1 to 
assume the obligation to repay a        
qualified loan amount for a loan made1  
insured1 or guaranteed under part ,b of 
this title2 and  7,b7 to cancel a       
qualified loan amount for a loan made   
under part ,d of this title4  7#c7      
,qualified loan amount ,after the       

borrower has made #abj monthly payments 
described in paragraph 7#a71 the        
,secretary shall forgive--  7,a7 with   
respect to new borrowers on or after the
 date of enactment of the ,student ,loan
 ,fairness ,act1 the sum of--  7i7 the  
balance of principal and fees due on the
 borrower's eligible loans as of the    
time of such forgiveness1 not to exceed 
#de1ebj2 and  7ii7 the amount of        
interest that has accrued on the balance
 described in clause 7i7 as of the time 
of such forgiveness2 or  7,b7 with      
respect to any other eligible borrower1 
the balance of principal1 interest1 and 
fees due on the borrower's eligible     
loans as of the time of such            
forgiveness4  7#d7 ,exclusion from      
taxable income ,the amount of a         
borrower's eligible loans forgiven under
 this section shall not be included in  
the gross income of the borrower for    
purposes of the ,internal ,revenue ,code
 of #aihf4  7c7 ,supporting             
documentation required ,a borrower who  

has elected to participate in the       
#aj_/aj ,loan ,repayment ,plan under    
subsection 7a71 or who is requesting    
forgiveness under the #aj_/aj ,loan     
,forgiveness ,program under subsection  
7b71 shall provide to the ,secretary    
such information and documentation as   
the ,secretary determines1 by           
regulation1 to be necessary to verify   
the borrower's adjusted gross income and
 payment amounts made on eligible loans 
of the borrower for the purposes of such
 ,plan or ,program4  7d7 ,definition of 
eligible loan ,in this section the term 
eligible loan means any loan made1      
insured1 or guaranteed under part ,b or 
,d4  4  #d4 ,capping interest rates for 
all ,federal ,direct loans ,section     
#dee7;b7 of the ,higher ,education ,act 
of #aife 7#bj ,u4,s4,c4 #ajhg;e7b77 is  
amended--  7#a7 by redesignating        
paragraphs 7#h7 and 7#i7 as paragraphs  
7#i7 and 7#aj71 respectively2 and  7#b7 
by inserting after paragraph 7#g7 the   
following3  7#h7 ,rate of interest for  

all new ,federal ,direct loans          
,notwithstanding any other provision of 
this ,act1 with respect to a loan under 
this part for which the first           
disbursement of principal is made 7or in
 the case of a ,federal ,direct         
,consolidation ,loan1 for which the     
application is received7 on or after    
,july #a1 #bjac1 or the date of         
enactment of the ,student ,loan         
,fairness ,act1 whichever is later1 the 
applicable rate of interest shall not   
exceed #c4d percent4  4  #e4 #aj_/aj    
,loan ,repayment ,plan as plan selected 
by the ,secretary  7a7 ,,ffel ,loans    
7#a7 ,in general ,section #dbh7;b7 of   
the ,higher ,education ,act of #aife    
7#bj ,u4,s4,c4 #ajgh7;b77#i77 is        
amended--  7,a7 in subparagraph 7,a7--  
7i7 by striking and at the end of clause
 7iv72  7ii7 in clause 7v71 by striking 
the period at the end and inserting 2   
and2 and  7iii7 by adding at the end the
 following new clause3  7vi7 beginning  
,july #a1 #bjac1 a #aj_/aj ,loan        

,repayment ,plan1 with varying annual   
repayment amounts based on the          
discretionary income of the borrower1 in
 accordance with section #dic;,e4  2 and
  7,b7 in subparagraph 7,b71 by striking
 7,a77i7 and inserting 7,a77vi74  7#b7  
,effective date ,the amendment made by  
paragraph 7#a77;,b7 shall be effective  
beginning ,july #a1 #bjac4  7b7 ,direct 
,loans  7#a7 ,in general ,section       
#dee7;d7 of the ,higher ,education ,act 
of #aife 7#bj ,u4,s4,c4 #ajhg;e7d77 is  
amended--  7,a7 in paragraph 7#a7--  7i7
 by striking and at the end of          
subparagraph 7,d72  7ii7 in subparagraph
 7,e71 by striking the period at the end
 and inserting a semicolon2 and  7iii7  
by adding at the end the following new  
subparagraph3  7,f7 beginning on ,july  
#a1 #bjac1 a #aj_/aj ,loan ,repayment   
,plan1 with varying annual repayment    
amounts based on the discretionary      
income of the borrower1 in accordance   
with section #dic;,e4  2 and  7,b7 in   
paragraph 7#b7--  7i7 by striking may   

and inserting shall2 and  7ii7 by       
striking 7,a71 7,b71 or 7,c7 and        
inserting 7,f74  7#b7 ,effective date   
,the amendment made by paragraph        
7#a77;,b7 shall be effective beginning  
,july #a1 #bjac4  #f4 ,improving and    
expanding ,public ,service ,loan        
,forgiveness ,section #dee7m7 of the    
,higher ,education ,act of #aife 7#bj   
,u4,s4,c4 #ajhg;e7m77 is amended--  7#a7
 in paragraph 7#a71 by striking #abj and
 inserting #fj each place it appears2   
and  7#b7 in paragraph 7#c77;,b7--  7,a7
 in clause 7i71 by striking or after the
 semicolon2  7,b7 in clause 7ii71 by    
striking the period and inserting 2 or2 
and  7,c7 by adding at the end the      
following3  7iii7 a full-time job as a  
primary care physician in an area or    
population designated as a ,medically   
,underserved ,area or ,population by the
 ,health ,resource and ,services        
,administration4  4  #g4 ,refinancing   
private education loans for certain     
borrowers  7a7 ,consolidation for       

certain borrowers ,section #dee7;g7 of  
the ,higher ,education ,act of #aife    
7#bj ,u4,s4,c4 #ajhg;e7g77 is amended-- 
7#a7 by striking ,a borrower and        
inserting the following3  7#a7 ,in      
general ,a borrower  2  7#b7 by         
inserting 1 and any loan described in   
paragraph 7#b7 after ,july #a1 #bjaj2   
and  7#c7 by adding at the end the      
following new paragraph3  7#b7          
,consolidation of private education     
loans as a ,federal ,direct             
,consolidation ,loan for certain        
borrowers  7,a7 ,in general             
,notwithstanding any other provision of 
law1 a borrower who meets the           
eligibility criteria described in       
subparagraph 7,b7 shall be eligible to  
obtain a ,federal ,direct ,consolidation
 loan under this paragraph that--  7i7  
shall include an eligible private       
education loan2 and  7ii7 may include a 
loan described in section               
#dbh;,c7a77#d74  7,b7 ,eligible borrower
 ,a borrower of an eligible private     

education loan is eligible to obtain a  
,federal ,direct ,consolidation ,loan   
under this paragraph if the borrower--  
7i7 was eligible to borrow a loan under 
section #dbh;,h1 a ,federal ,direct     
,unsubsidized ,stafford ,loan1 a loan   
under section #dbh;,b1 or a ,federal    
,direct ,,plus loan for a period of     
enrollment at an institution of higher  
education1 or1 with respect to a        
borrower who was enrolled at an         
institution of higher education on less 
than a half-time basis1 would have been 
eligible to borrow such a loan for such 
period of enrollment if the borrower had
 been enrolled on at least a half-time  
basis2  7ii7 borrowed at least one      
eligible private education loan for a   
period of enrollment described in clause
 7i72 and  7iii7 has an average adjusted
 gross income 7based on the borrower's  
adjusted gross income from the #c most  
recent calendar years before application
 for consolidation under this section7  
that is equal to or less than the       

borrower's total education debt         
7determined by calculating the sum of   
the borrower's loans described in       
section #dbh;,c7a77#d7 and eligible     
private education loans7 at the time of 
such application4  7,c7 ,definition of  
eligible private education loan ,for    
purposes of this paragraph1 the term    
eligible private education loan means a 
private education loan 7as such term is 
defined in section #adj of the ,truth in
 ,lending ,act 7#ae ,u4,s4,c4 #afej77   
made on or before the date of enactment 
of the ,student ,loan ,fairness ,act1   
including the amount of outstanding     
principal1 accrued interest1 and related
 fees and costs 7as determined by the   
,secretary7 owed by a borrower on such a
 loan4  7,d7 ,purchase of loan ,for each
 eligible private education loan that a 
borrower is consolidating under this    
paragraph1 the ,secretary shall notify  
the holder that the ,secretary is       
purchasing the loan1 and the ,secretary 
shall then purchase such loan1 as       

described under section #adj;,a of the  
,truth in ,lending ,act4  7,e7 ,terms   
and rate of interest ,a ,federal ,direct
 ,consolidation ,loan made under this   
paragraph shall have the same terms and 
conditions as a ,federal ,direct        
,consolidation loan under paragraph     
7#a71 except that the applicable rate of
 interest for a ,federal ,direct        
,consolidation loan made under this     
paragraph shall not exceed #c4d percent4
  7,f7 ,notification of eligible        
borrowers ,the ,secretary shall take    
such steps as may be necessary to notify
 eligible borrowers of the availability 
of consolidation under this paragraph no
 later than #fj days after the date of  
enactment of the ,student ,loan         
,fairness ,act1 including notifying such
 borrowers of the deadline to apply for 
such a loan under subparagraph 7,g74    
7,g7 ,application deadline for loans    
under this paragraph ,a borrower may    
apply for loans under this paragraph    
during the #a-year period beginning on  

the date of enactment of the ,student   
,loan ,fairness ,act4 ,the ,secretary   
shall not make a ,federal ,direct       
,consolidation ,loan under this         
paragraph to any borrower who has not   
submitted an application for such a loan
 to the ,secretary before the end of    
such period4  7,h7 ,authorization and   
appropriation ,there are authorized to  
be appropriated1 and there are          
appropriated1 such sums as may be       
necessary to carry out this paragraph4  
4  7b7 ,sale of private education loans 
to the ,government ,chapter #b of the   
,truth in ,lending ,act 7#ae ,u4,s4,c4  
#afca et seq47 is amended--  7#a7 by    
redesignating section #adj;,a as section
 #adj;,b2  7#b7 by inserting after      
section #adj the following3  #adj;,a4   
,sale of private education loans to the 
,government  7a7 ,in general ,the       
,bureau shall issue regulations to      
require a private education lender to   
sell an eligible private education loan 
to the ,secretary of ,education1 upon   

request of the ,secretary1 for purposes 
of consolidating such loan1 as described
 under section #dee7;g77#b7 of the      
,higher ,education ,act of #aife4  7b7  
,determination of price ,the price paid 
for a private education loan under      
subsection 7a7 shall--  7#a7 include the
 amount of outstanding principal on the 
loan1 the amount of accrued interest on 
the loan1 and any fees or other costs   
owed by the consumer on the loan2 and   
7#b7 be adjusted to account for the time
 value of such amount4  7c7 ,definitions
 ,for purposes of this section3  7#a7   
,eligible private education loan ,the   
term eligible private education loan    
means a private education loan1 as      
defined under section #adj7;a71 made on 
or before the date of enactment of the  
,student ,loan ,fairness ,act4  7#b7    
,private education lender ,the term     
private education lender has the meaning
 given such term under section #adj7;a74
  2 and  7#c7 in the table of contents  
for such chapter--  7,a7 by             

redesignating the item relating to      
section #adj;,a as item #adj;,b2 and    
7,b7 by inserting after the item        
relating to section #adj the following3 
#adj;,a4 ,sale of private education     
loans to the ,government4  4  7c7       
,conforming amendment ,section          
#dbh;,c7a77#c77;,b77i77,v7 of the       
,higher ,education ,act of #aife 7#bj   
,u4,s4,c4 #ajgh-c7;a77#c77;,b77i77,v77  
is amended--  7#a7 by striking or at the
 end of item 7bb72  7#b7 by striking the
 period at the end of item 7cc7 and     
inserting 2 or2 and  7#c7 by adding at  
the end the following3  7dd7 for the    
purpose of consolidating an eligible    
private education loan under section    
#dee7;g77#b71 whether such loan is      
consolidated alone1 with other eligible 
private education loans1 or with loans  
described in paragraph 7#d74  4  #h4    
,interest-free deferment of unsubsidized
 loans during periods of unemployment   
7a7 ,,ffel ,unsubsidized loan deferment 
7#a7 ,section #dbh;,h7e77#b7 of the     

,higher ,education ,act of #aife 7#bj   
,u4,s4,c4 #ajgh-h7;e77#b77 is amended-- 
7,a7 in subparagraph 7,a71 by inserting 
,except as provided in subparagraph     
7,c71 before ,interest on2 and  7,b7 by 
adding at the end the following3  7,c7  
,interest on loans made under this      
section for which payments are deferred 
under clause 7ii7 of section            
#dbh7;b77#a77,m71 for a period of       
deferment granted to a borrower on or   
after the date of enactment of the      
,student ,loan ,fairness ,act1 shall    
accrue and be paid by the ,secretary    
during any period during which loans are
 so deferred1 not in excess of #c years4
  4  7#b7 ,conforming amendment ,section
 #dbh7;b77#a77,y77iii7 of the ,higher   
,education ,act of #aife 7#bj ,u4,s4,c4 
#ajgh7;b77#a77,y77iii77 is amended by   
inserting 7other than a deferment under 
clause 7ii7 of such subparagraph on or  
after the date of enactment of the      
,student ,loan ,fairness ,act7 after of 
this paragraph4  7b7 ,direct            

,unsubsidized loan deferment ,section   
#dee7;f77#a7 of the ,higher ,education  
,act of #aife 7#bj ,u4,s4,c4            
#ajhg;e7f77#a77 is amended--  7#a7 in   
subparagraph 7,a7--  7,a7 by striking or
 at the end of clause 7i72 and  7,b7 by 
adding at the end the following3  7iii7 
a ,federal ,direct ,unsubsidized        
,stafford ,loan1 with respect to a      
period of deferment described in        
subparagraph 7,b7 of paragraph 7#b7     
granted to a borrower on or after the   
date of enactment of the ,student ,loan 
,fairness ,act2 or  2 and  7#b7 in      
subparagraph 7,b71 by inserting not     
described in subparagraph 7,a77iii7     
after ,unsubsidized ,stafford ,loan4    
7c7 ,treatment of consolidation loans   
,section #dbh;,c7b77#d77;,c77ii7 of the 
,higher ,education ,act of #aife 7#bj   
,u4,s4,c4 #ajgh-c7;b77#d77;,c77ii77 is  
amended--  7#a7 by striking or at the   
end of subclause 7,,ii72  7#b7 by       
redesignating subclause 7,,iii7 as      
subclause 7,,iv72  7#c7 by inserting    

after subclause 7,,ii7 the following3   
7,,iii7 by the ,secretary1 in the case  
of a consolidation loan for which the   
application is received on or after the 
date of enactment of the ,student ,loan 
,fairness ,act1 except that the         
,secretary shall pay such interest only 
for a period not in excess of #c years  
for which the borrower would be eligible
 for a deferral under clause 7ii7 of    
section #dbh7;b77#a77,m72 or  2 and     
7#d7 in subclause 7,,iv7 7as so         
redesignated by this subsection71 by    
striking 7,i7 or 7,,ii7 and inserting   
7,i71 7,,ii71 or 7,,iii74  7d7          
,income-,based repayment ,section       
#dic;,c7b7 of the ,higher ,education    
,act of #aife 7#bj ,u4,s4,c4            
#ajihc7;b77--  7#a7 in paragraph 7#c7-- 
7,a7 in subparagraph 7,a71 by striking  
and after the semicolon2  7,b7 by       
redesignating subparagraph 7,b7 as      
subparagraph 7,c72  7,c7 by inserting   
after subparagraph 7,a7 the following3  
7,b7 shall1 on subsidized and           

unsubsidized loans1 be paid by the      
,secretary for a period of not more than
 #c years during which the borrower is  
eligible for a deferment due to         
unemployment described in section       
#dee7;f77#b77;,b7 7regardless of whether
 the student is in such a deferment71   
except that--  7i7 this subparagraph    
shall only apply to periods during which
 the borrower is eligible for such a    
deferment on or after the date of       
enactment of the ,student ,loan         
,fairness ,act2 and  7ii7 in the case of
 a subsidized loan1 such period shall   
not include any period described in     
subparagraph 7,a7 or any period during  
which the borrower is in deferment due  
to an economic hardship described in    
section #dce7o72 and  2 and  7,d7 in    
subparagraph 7,c7 7as so redesignated by
 paragraph 7#b77--  7i7 in clause 7i71  
by striking subparagraph 7,a7 and       
inserting subparagraphs 7,a7 and 7,b72  
and  7ii7 in clause 7ii71 by inserting 1
 subject to subparagraph 7,b71 after    

unsubsidized loan2 and  7,e7 by striking
 and at the end of paragraph 7#h72  7,f7
 by striking the period at the end of   
paragraph 7#i7 and inserting a          
semicolon2 and  7,g7 by adding at the   
end the following new paragraph3  7#aj7 
the amount of the principal and interest
 on a borrower's loans repaid or        
canceled under paragraph 7#g7 shall not 
be included in the gross income of the  
borrower for purposes of the ,internal  
,revenue ,code of #aihf4  4  #i4        
,excluding loans forgiven under certain 
repayment programs from gross income    
7a7 ,income-,contingent repayment       
,section #dee7;e77#b7 of the ,higher    
,education ,act of #aife 7#bj ,u4,s4,c4 
#ajhg;e7e77#b77 is amended--  7#a7 in   
the subsection heading1 by inserting and
 forgiveness after repayment2 and  7#b7 
by adding at the end the following3 ,the
 amount of the principal and interest on
 a borrower's loans forgiven pursuant to
 income contingent repayment shall not  
be included in the gross income of the  

borrower for purposes of the ,internal  
,revenue ,code of #aihf44  7b7 ,pay as  
you earn repayment ,the amount of the   
principal and interest on a borrower's  
loans forgiven pursuant to the          
income-contingent repayment plan 7based 
on the ,president's ,pay ,as ,you ,earn 
repayment initiative7 implemented in    
parts #fgd1 #fhb1 and #fhe of title #cd1
 ,code of ,federal ,regulations1 as     
amended by the final regulations        
published by the ,department of         
,education in the ,federal ,register on 
,november #a1 #bjab 7#gg ,fed4 ,reg4    
#ffjhh et seq471 shall not be included  
in the gross income of the borrower for 
purposes of the ,internal ,revenue ,code
 of #aihf4