20 USC 1073 – Effects of adequate non-Federal programs
(a) Federal insurance barred to lenders with access to State or private insurance
Except as provided in subsection (b), the Secretary shall not issue certificates of insurance under section 1079 of this title to lenders in a State if the Secretary determines that every eligible institution has reasonable access in that State to a State or private nonprofit student loan insurance program which is covered by an agreement under section 1078(b) of this title.
(b) Exceptions
Terms Used In 20 USC 1073
- borrower: as used in this part shall include a parent borrower under this section. See 20 USC 1078-2
- eligible institution: means an institution of higher education, as defined in section 1002 of this title, except that, for the purposes of sections 1077(a)(2)(C)(i) and 1078(b)(1)(M)(i) of this title, an eligible institution includes any institution that is within this definition without regard to whether such institution is participating in any program under this subchapter and includes any institution ineligible for participation in any program under this part pursuant to paragraph (2) of this subsection. See 20 USC 1085
- guaranty agency: means any State or nonprofit private institution or organization with which the Secretary has an agreement under section 1078(b) of this title. See 20 USC 1085
- State: means a State, the District of Columbia, the Commonwealth of Puerto Rico, or any other territory or possession of the United States. See 1 USC 7
The Secretary may issue certificates of insurance under section 1079 of this title to a lender in a State—
(1) for insurance of a loan made to a student borrower who does not, by reason of the borrower’s residence, have access to loan insurance under the loan insurance program of such State (or under any private nonprofit loan insurance program which has received an advance under section 1072 of this title for the benefit of students in such State);
(2) for insurance of all the loans made to student borrowers by a lender who satisfies the Secretary that, by reason of the residence of such borrowers, such lender will not have access to any single State or nonprofit private loan insurance program which will insure substantially all of the loans such lender intends to make to such student borrowers; or
(3) under such circumstances as may be approved by the guaranty agency in such State, for the insurance of a loan to a borrower for whom such lender previously was issued such a certificate if the loan covered by such certificate is not yet repaid.