[Code of Federal Regulations]

[Title 42, Volume 1]

[Revised as of October 1, 2005]

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

[CITE: 42CFR60.61]



[Page 347-349]

 

                         TITLE 42--PUBLIC HEALTH

 

    CHAPTER I--PUBLIC HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN 

                                SERVICES

 

PART 60_HEALTH EDUCATION ASSISTANCE LOAN PROGRAM--Table of Contents

 

                          Subpart E_The School

 

Sec. 60.61  Responsibilities of a HEAL school.



    (a) A HEAL school is required to carry out the following activities 

for each HEAL applicant or borrower:

    (1) Conduct and document an entrance interview with each student 

(individually or in groups) no later than prior to the loan recipient's 

first HEAL disbursement in each academic year that the loan recipient 

obtains a HEAL loan. The school must inform the loan recipient during 

the entrance interview of his or her rights and responsibilities under a 

HEAL loan, including the consequences for noncompliance with those 

responsibilities, and must gather personal information which would 

assist in locating the loan recipient should he or she depart from the 

school without receiving an exit interview. A school may meet this 

requirement through correspondence where the



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school determines that a face-to-face meeting is impracticable.

    (2) Conduct and document an exit interview with each HEAL loan 

recipient (individually or in groups) within the final academic term of 

the loan recipient's enrollment prior to his or her anticipated 

graduation date or other departure date from the school. The school must 

inform the loan recipient in the exit interview of his or her rights and 

responsibilities under each HEAL loan, including the consequences for 

noncompliance with those responsibilities. The school must also collect 

personal information from the loan recipient which would assist the 

school or the lender or holder in skiptracing activities and to direct 

the loan recipient to contact the lender or holder concerning specific 

repayment terms and options. A copy of the documentation of the exit 

interview, including the personal information collected for skiptracing 

activities, and any other information required by the Secretary 

regarding the exit interview must be sent to the lender or holder of 

each HEAL loan within 30 days of the exit interview. If the loan 

recipient departs from the school prior to the anticipated date or does 

not receive an exit interview, the exit interview information must be 

mailed to the loan recipient by the school within 30 days of the 

school's knowledge of the departure or the anticipated departure date, 

whichever is earlier. The school must request that the loan recipient 

forward any required information (e.g., skiptracing information, request 

for deferment, etc.) to the lender or holder. The school must notify the 

lender or holder of the loan recipient's departure at the same time it 

mails the exit interview material to the loan recipient.

    (3) Verify the accuracy and completeness of information provided by 

each student on the HEAL loan application, particularly in regard to the 

HEAL eligibility requirements, by comparing the information with 

previous loan applications or other records or information provided by 

the student to the school. Notify the potential lender of any 

discrepancies which were not resolved between the school and the 

student.

    (4) Develop and implement procedures relating to check receipt and 

release which keep these functions separate from the application 

preparation and approval process and assure that the amount of the HEAL 

loan check(s) does(do) not exceed the approved total amount of the loan 

and the statutory maximums. Checks must not be cashed without the 

borrower's personal endorsement. Documentation of these procedures and 

their usage shall be maintained by the school.

    (5) Maintain accurate and complete records on each HEAL borrower and 

related school activities required by the HEAL program. All HEAL records 

shall be properly safeguarded and protected from environmental threats 

and unauthorized intrusion for use and theft.

    (6) Maintain documentation of the criteria used to develop the 

school's standard student budgets in the school's general records, 

readily available for audit purposes, and maintain in each HEAL 

borrower's record a copy of the standard budget which was actually used 

in the determination of the maximum loan amount approvable for the 

student, as described in Sec. 60.51.

    (7) Notify the lender or its assignee of any changes in the 

student's name, address, status, or other information pertinent to the 

HEAL loan not more than 30 days after receiving information indicating 

such a change.

    (b) Any school which has information which indicates potential or 

actual commission of fraud or other offenses against the United States 

involving these loan funds must promptly provide this information to the 

appropriate Regional Office of Inspector General for Investigations.

    (c) The school will be considered responsible and the Secretary may 

seek reimbursement from any school for the amount of a loan in default 

on which the Secretary has paid an insurance claim, if the Secretary 

finds that the school did not comply with the applicable HEAL statute 

and regulations, or its written agreement with the Secretary. The 

Secretary may excuse certain defects if the school satisfies the 

Secretary that the defect did not contribute to the default or prejudice 

the Secretary's attempt to collect the loan from the borrower.



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    (d) A school is authorized to withhold services from a HEAL borrower 

who is in default on a HEAL loan received while enrolled in that school, 

except in instances where the borrower has filed for bankruptcy. Such 

services may include, but are not limited to academic transcripts and 

alumni services. Defaulted HEAL borrowers who have filed for bankruptcy 

shall provide court documentation that verifies the filing for 

bankruptcy upon the request of the school. Schools will also supply this 

information to the Secretary upon request. All academic and financial 

aid transcripts that are released on a defaulted HEAL borrower must 

indicate on the transcript that the borrower is in default on a HEAL 

loan. It is the responsibility of the borrower to provide the school 

with documentation from the lender, holder, or Department when a default 

has been satisfactorily resolved, in order to obtain access to services 

that are being withheld, or to have the reference to default removed 

from the academic and financial aid transcripts.



(Approved by the Office of Management and Budget under control number 

0915-0108)



[52 FR 752, Jan. 8, 1987, as amended at 57 FR 28799, June 29, 1992; 58 

FR 67350, Dec. 21, 1993]



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