[Code of Federal Regulations]

[Title 34, Volume 3]

[Revised as of July 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 34CFR674.56]



[Page 604-605]

 

                           TITLE 34--EDUCATION

 

 CHAPTER VI--OFFICE OF POSTSECONDARY EDUCATION, DEPARTMENT OF EDUCATION

 

PART 674_FEDERAL PERKINS LOAN PROGRAM--Table of Contents

 

                       Subpart D_Loan Cancellation

 

Sec. 674.56  Employment cancellation--Federal Perkins, NDSL and Defense 

loans.



    (a) Cancellation for full-time employment as a nurse or medical 

technician. (1) An institution must cancel up to 100 percent of the 

outstanding balance on a borrower's Federal Perkins or NDSL made on or 

after July 23, 1992, for full-time employment as a nurse or medical 

technician providing health care services.

    (2) An institution must cancel up to 100 percent of the outstanding 

balance on a Federal Perkins, NDSL or Defense loan made prior to July 

23, 1992, for full-time service as a nurse or medical technician 

performed on or after October 7, 1998, if the cancellation benefits 

provided under this section are not included in the borrower's 

promissory note.

    (b) Cancellation for full-time employment in a public or private 

nonprofit child or family service agency. (1) An institution must cancel 

up to 100 percent of the outstanding balance on a borrower's Federal 

Perkins or NDSL made on or after July 23, 1992, for service as a full-

time employee in a public or private nonprofit child or family service 

agency who is providing, or supervising the provision of, services to 

high-risk children who are from low-income communities and the families 

of these children.

    (2) An institution must cancel up to 100 percent of the outstanding 

loan balance on a Federal Perkins, NDSL or Defense loan made prior to 

July 23, 1992, for employment in a child or family service agency 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.

    (c) Cancellation for service as a qualified professional provider of 

early intervention services. (1) An institution must cancel up to 100 

percent of the outstanding balance on a borrower's Federal Perkins or 

NDSL made on or after July 23, 1992, for the borrower's service as a 

full-time qualified professional provider of early intervention services 

in a public or other nonprofit program under public supervision by the 

lead agency as authorized in section 676(b)(9) of the Individual with 

Disabilities Act.

    (2) An institution must cancel up to 100 percent of the outstanding 

loan balance on a Federal Perkins, NDSL or Defense loan made prior to 

July 23, 1992 for early intervention service performed on or after 

October 7, 1998, if



[[Page 605]]



the cancellation benefits provided under this section are not included 

in the terms of the borrower's promissory note.

    (d) Cancellation rates. (1) To qualify for cancellation under 

paragraphs (a), (b), and (c) of this section, a borrower must work full-

time for 12 consecutive months.

    (2) Cancellation rates are--

    (i) 15 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 years of full-time employment;

    (ii) 20 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 years of full-time employment; 

and

    (iii) 30 percent of the original principal loan amount plus the 

interest on the unpaid balance accruing during the year of qualifying 

service, for the fifth year of full-time employment.



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



[59 FR 61414, Nov. 30, 1994, as amended at 64 FR 58314, Oct. 28, 1999]