(a) In General.—An individual who receives educational assistance under the scholarship program under this chapter shall repay to the Secretary an amount equal to the unearned portion of such assistance if the individual fails to satisfy the requirements of the agreement entered into under section 7504 of this title, except in circumstances authorized by the Secretary.
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Terms Used In 38 USC 7505
- Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
- Contract: A legal written agreement that becomes binding when signed.
- individual: shall include every infant member of the species homo sapiens who is born alive at any stage of development. See 1 USC 8
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
(b) Amount of Repayment.—The Secretary shall establish, by regulations, procedures for determining the amount of the repayment required under this section and the circumstances under which an exception to the required repayment may be granted.
(c) Waiver or Suspension of Compliance.—The Secretary shall prescribe regulations providing for the waiver or suspension of any obligation of an individual for service or payment under this chapter (or an agreement under this chapter) whenever—
(1) noncompliance by the individual is due to circumstances beyond the control of the individual; or
(2) the Secretary determines that the waiver or suspension of compliance is in the best interest of the United States.
(d) Obligation as Debt to United States.—An obligation to repay the Secretary under this section is, for all purposes, a debt owed the United States. A discharge in bankruptcy under title 11 does not discharge a person from such debt if the discharge order is entered less than five years after the date of the termination of the agreement or contract on which the debt is based.
