[Code of Federal Regulations]
[Title 42, Volume 1]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR57.308]

[Page 276-277]
 
                         TITLE 42--PUBLIC HEALTH
 
    CHAPTER I--PUBLIC HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN 
                                SERVICES
 
PART 57--GRANTS FOR CONSTRUCTION OF TEACHING FACILITIES, EDUCATIONAL IMPROVEMENTS, SCHOLARSHIPS AND STUDENT LOANS--Table of Contents
 
                    Subpart D--Nursing Student Loans
 
Sec. 57.308  Nursing student loan promissory note.

    (a) Promissory note form. Each nursing student loan must be 
evidenced by a properly executed promissory note in a form approved by 
the Secretary. The school must safeguard the promissory note against 
fire, theft, and tampering.
    (1) Each promissory note must state that the loan will bear interest 
on the unpaid balance computed only for periods during which repayment 
of the loan is required, at the rate of 5 percent per year.
    (2) Each promissory note must contain an acceleration clause 
provided by the Secretary, which will permit the acceleration of 
delinquent loans at the school's option.
    (3) A copy of each executed note must be supplied by the school to 
the student borrower.
    (b) Security. A school must require security or endorsement if the 
borrower is a minor and if, under the applicable State law, the note 
signed by him or

[[Page 277]]

her would not create a binding obligation. The school may not require 
security or endorsement in any other circumstances.

(Approved by the Office of Management and Budget under control number 
0915-0047)

[50 FR 34434, Aug. 23, 1985, as amended at 56 FR 13771, Apr. 4, 1991; 57 
FR 45735, Oct. 5, 1992]