[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: 34CFR674.60]



[Page 606-607]

 

                           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. 674.60  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 607]]



    (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]