[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: 34CFR674.60]

[Page 620-621]
 
                           TITLE 34--EDUCATION
 
                         DEPARTMENT OF EDUCATION
 
PART 674--FEDERAL PERKINS LOAN PROGRAM--Table of Contents
 
                      Subpart D--Loan Cancellation
 
Sec. 674.60  Cancellation for volunteer service--Perkins loans, NDSLs and 
Defense loans.

    (a)(1) An institution must cancel up to 70 percent of the 
outstanding balance on a Perkins loan, and 70 percent of the outstanding 
balance of an NDSL made on or after October 7, 1998, for service as a 
volunteer under The Peace Corps Act or The Domestic Volunteer Service 
Act of 1973 (ACTION programs).
    (2) An institution must cancel up to 70 percent of the outstanding 
balance on an NDSL or Defense loan for service as a volunteer under The 
Peace Corps Act or The Domestic Volunteer Service Act of 1973 (ACTION 
programs) performed on or after October 7, 1998, if the cancellation 
benefits provided under this section are not included in the terms of 
the borrower's promissory note.
    (b) Cancellation rates are--
    (1) Fifteen percent of the original principal loan amount plus the 
interest on the unpaid balance accruing during the year of qualifying 
service, for each of the first and second twelve-month periods of 
service;

[[Page 621]]

    (2) Twenty percent of the original principal loan amount plus the 
interest on the unpaid balance accruing during the year of qualifying 
service, for each of the third and fourth twelve-month periods of 
service.

(Authority: 20 U.S.C. 1087ee)

[52 FR 45758, Dec. 1, 1987, as amended at 57 FR 32347, July 21, 1992. 
Redesignated at 59 FR 61413, Nov. 30, 1994, as amended at 64 FR 58314, 
Oct. 28, 1999]