[Code of Federal Regulations]
[Title 34, Volume 3]
[Revised as of July 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 34CFR674.37]

[Page 599]
 
                           TITLE 34--EDUCATION
 
                         DEPARTMENT OF EDUCATION
 
PART 674--FEDERAL PERKINS LOAN PROGRAM--Table of Contents
 
                        Subpart B--Terms of Loans
 
Sec. 674.37  Deferment of repayment--NDSLs made before October 1, 1980 
and Defense loans.

    (a) A borrower may defer repayment--
    (1) On an NDSL made before October 1, 1980 during the periods 
described in paragraphs (b) through (e) of this section; and
    (2) On a Defense loan, during the periods described in paragraphs 
(b) through (f) of this section.
    (b)(1) A borrower need not repay principal, and interest does not 
accrue, during a period after the commencement or resumption of the 
repayment period on a loan, when the borrower is at least a half-time 
regular student at--
    (i) An institution of higher education; or
    (ii) A comparable institution outside the U.S. approved by the 
Secretary for this purpose.
    (2) The institution of higher education does not need to be 
participating in the Perkins Loan program for the borrower to qualify 
for a deferment.
    (3) If a borrower is attending as at least a half-time regular 
student for a full academic year and intends to enroll as at least half-
time regular student in the next academic year, the borrower is entitled 
to deferment for 12 months.
    (4) If an institution no longer qualifies as an institution of 
higher education, the borrower's deferment ends on the date the 
institution ceases to qualify.
    (c) A borrower need not repay principal, and interest does not 
accrue for a period of up to 3 years during which time the borrower is--
    (1) A member of the U.S. Army, Navy, Air Force, Marines or Coast 
Guard (see Sec. 674.59);
    (2) A Peace Corps volunteer (see Sec. 674.60); or
    (3) A volunteer under the Domestic Volunteer Service Act of 1973 
(ACTION programs) (see Sec. 674.60).
    (d) The institution shall exclude the deferment periods described in 
paragraphs (b), (c), and (e) of this section when determining the 10-
year repayment period.
    (e) An institution may permit the borrower to defer payments of 
principal and interest, but interest shall continue to accrue, if the 
institution determines this is necessary to avoid hardship to the 
borrower (see Sec. 674.33(c)).
    (f) The institution may permit the borrower to defer payment of 
principal and interest, but interest shall continue to accrue, on a 
Defense loan for a total of 3 years after the commencement or resumption 
of the repayment period on a loan, during which he or she is attending 
an institution of higher education as a less-than-half-time regular 
student.

(Approved by the Office of Management and Budget under control number 
1845-0019)

(Authority: 20 U.S.C. 425, 1087dd)

[52 FR 45754, Dec. 1, 1987, as amended at 57 FR 32345, July 21, 1992; 59 
FR 1652, Jan. 12, 1994. Redesignated at 59 FR 61410, Nov. 30, 1994, as 
amended at 62 FR 50848, Sept. 26, 1997; 64 FR 58315, Oct. 28, 1999]