,i #aafth ,,congress #ast ,session ,h4 ,r4 #cghf ,,in ,,the ,,house ,,of ,,representatives ,july #af1 #bjai,mr4 ,perry introduced the following bill2 which was referred to the ,committee on ,education and ,labor ,a ,,bill ,to amend the ,higher ,education ,act of #aife to direct the ,secretary of ,education to carry out a program under which an institution of higher education may elect to cosign ,federal student loans made to students attending the institution1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,student ,loan ,reform ,act4 #b4 ,institutional cosigner program ,part ,d of title ,,iv of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajhg;a et seq47 is amended by inserting after section #ded the following3 #ded;,a4 ,institutional cosigner program 7a7 ,program required ,beginning on ,july #a1 #bjbj1 the ,secretary shall carry out a program under which an institution of higher education may elect to cosign all eligible direct loans made to students enrolled at the institution for an academic year4 7b7 ,agreement with ,secretary ,to be eligible to participate in the program under this section for an academic year1 an institution of higher education shall enter into an agreement with the ,secretary under which the institution agrees to the following3 7#a7 ,the institution will cosign all new eligible direct loans made to students enrolled at the institution for such academic year4 7#b7 ,with respect to each such loan1 the institution will abide by the terms and conditions of cosigner liability described in subsection 7d74 7c7 ,master promissory note ,as part of the program under this section1 the ,secretary shall-- 7#a7 revise the master promissory note applicable to each eligible direct loan to include-- 7,a7 the terms and conditions of cosigner and borrower liability described in subsection 7d72 7,b7 the interest rate for the loan1 as determined under subsection 7e72 and 7,c7 a field in which an authorized representative of an institution participating in the program may cosign the note on behalf of the institution2 and 7#b7 ensure that each institution participating in the program signs the note applicable to each new eligible direct loan made to a student at the institution for the academic year concerned4 7d7 ,cosigner and borrower liability 7#a7 ,in general ,notwithstanding any other provision of law1 an institution of higher education that is a cosigner of an eligible direct loan of a borrower shall assume the obligation to repay1 in accordance with paragraph 7#b71 the outstanding balance of principal and interest due on the loan if-- 7,a7 the borrower defaulted on the loan2 7,b7 a period of #ij days has elapsed since the date on which the loan entered default2 and 7,c7 the loan has not been rehabilitated4 7#b7 ,amount and schedule of repayment ,an institution that is obligated to repay an eligible direct loan under paragraph 7#a7 shall make payments on the loan pursuant to a standard repayment plan under section #dee7;d77#a77;,a7 with a repayment period of #aj years4 7#c7 ,termination of obligation ,the obligation of an institution to repay an eligible direct loan under paragraph 7#a7 shall terminate on the earlier of-- 7,a7 the date on which the loan is rehabilitated2 or 7,b7 the date on which the total outstanding balance of principal and interest due on the loan has been repaid4 7#d7 ,effect on default status of borrower ,a borrower who has defaulted on an eligible direct loan on which an institution is making payments under paragraph 7#a7 shall be considered in default on such loan for purposes of adverse credit reporting and delinquent debt collection procedures under ,federal law4 7#e7 ,recovery from borrower ,any amounts recovered from the borrower of an eligible direct loan during a period in which an institution is making payments on the loan under paragraph 7#a7 shall be subtracted from the total outstanding balance of principal and interest due on the loan4 7#f7 ,rule of construction ,nothing in this subsection shall be construed to limit the remedies available under this part against the borrower of an eligible ,federal student loan4 7e7 ,reduced interest rate ,notwithstanding any other provision of law1 the interest rate applicable to an eligible direct loan cosigned by an institution participating in the program under this section shall be a rate determined by the ,secretary that is-- 7#a7 lower than the standard rate applicable to the loan under section #dee7;b72 and 7#b7 reduced below such standard rate by a percentage that is proportionate to the reduced risk posed by the loan1 as determined by the ,secretary4 7f7 ,list of participating institutions ,on an annual basis1 the ,secretary shall publish1 on a publicly accessible website of the ,department of ,education1 a list that identifies each institution participating in the program under this section for an academic year4 7g7 ,eligible direct loan defined ,in this section1 the term eligible direct loan means a loan made under this part on or after ,july #a1 #bjbj4 4 #c4 ,modification of cohort default rate threshold 7a7 ,in general ,section #dce7;a7 of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajhe7;a77 is amended-- 7#a7 in paragraph 7#b7-- 7,a7 by striking subparagraphs 7,b7 and 7,c7 and inserting the following3 7,b7 ,for purposes of determinations under subparagraph 7,a71 the threshold percentage is-- 7i7 #dj percent1 in the case of an institution that is participating in the institutional cosigner program under section #ded;,a in the year in which the cohort default rate is determined2 or 7ii7 #cj percent1 in the case of an institution that is not participating in such program in the year in which the cohort default rate is determined4 2 and 7,b7 by redesignating subparagraph 7,d7 as subparagraph 7,c72 7#b7 in paragraph 7#c71 by striking paragraph 7#b77;,b77iv7 and inserting paragraph 7#b77;,b72 and 7#c7 in paragraph 7#g71 by striking paragraph 7#b77;,b77iv7 each place it appears and inserting paragraph 7#b77;,b74 7b7 ,effective date ,the amendments made by subsection 7a7 shall take effect on ,july #a1 #bjbj4