[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: 34CFR682.400]



[Page 688-689]

 

                           TITLE 34--EDUCATION

 

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

 

PART 682_FEDERAL FAMILY EDUCATION LOAN (FFEL) PROGRAM--Table of Contents

 

 Subpart D_Administration of the Federal Family Education Loan Programs 

                          by a Guaranty Agency

 

Sec. 682.400  Agreements between a guaranty agency and the Secretary.





    (a) The Secretary enters into agreements with a guaranty agency 

whose loan guarantee program meets the requirements of this subpart. The 

agreements enable the guaranty agency to participate in the FFEL 

programs and to receive the various payments and benefits related to 

that participation.

    (b) There are four agreements:



[[Page 689]]



    (1) Basic program agreement. In order to participate in the FFEL 

programs, a guaranty agency must have a basic program agreement. Under 

this agreement--

    (i) Borrowers whose Stafford and Consolidation loans that 

consolidate only subsidized Stafford loans are guaranteed by the agency 

may qualify for interest benefits that are paid to the lender on the 

borrower's behalf; and

    (ii) Lenders under the guaranty agency program may receive special 

allowance payments from the Secretary and have death, disability, 

bankruptcy, closed school and false certification discharge claims paid 

by the Secretary through the guaranty agency.

    (2) Federal advances for claim payments agreement. A guaranty agency 

must have an agreement for Federal advances for claim payments to 

receive and use Federal advances to pay default claims.

    (3) Reinsurance agreement. A guaranty agency must have a reinsurance 

agreement to receive reimbursement from the Secretary for its losses on 

default claims.

    (4) Loan Rehabilitation Agreement. A guaranty agency must have an 

agreement for rehabilitating a loan for which the Secretary has made a 

reinsurance payment under section 428(c)(1) of the Act.

    (c) The Secretary's execution of an agreement does not indicate 

acceptance of any current or past standards or procedures used by the 

agency.

    (d) All of the agreements are subject to subsequent changes in the 

Act, in other applicable Federal statutes, and in regulations that apply 

to the FFEL programs.



(Authority: 20 U.S.C. 1072, 1078-1, 1078-2, 1078-3, 1082, 1087, 1087-1)



[57 FR 60323, Dec. 18, 1992, as amended at 59 FR 33353, June 28, 1994; 

64 FR 18978, Apr. 16, 1999; 64 FR 58627, Oct. 29, 1999]