Section 5. The purpose of the Authority shall be to assist borrowers and institutions for higher education in the financing and refinancing of the costs of education and to provide students and parents with convenient and effective savings programs, and for these purposes the Authority is authorized and empowered:

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(a) to adopt by-laws for the regulation of its affairs and the conduct of its business;

(b) to adopt an official seal and alter the same at pleasure;

(c) to maintain an office at such place or places in the commonwealth as it may designate;

(d) to sue and be sued in its own name, plead and be impleaded;

(e) to determine criteria and guidelines encompassing the type of and qualifications for education loan financing programs. The criteria and guidelines established by the Authority for its education loan financing programs shall include such eligibility standards for borrowers as the Authority shall determine are necessary or desirable in order to effectuate the purposes of the chapter, including the following:—(i) each student shall have a certificate of admission or enrollment at a participating institution for higher education, (ii) each student or his or her parents shall satisfy such financial qualifications as the Authority shall establish to effectuate the purposes of the chapter, and (iii) each student and his parents shall submit such information as may be required by the Authority to his or her institution of higher education;

(f) to establish specific criteria governing the eligibility of institutions for higher education to participate in its programs, and for the making of Authority loans and education loans, provisions for default, the establishment of default reserve funds, the purchase of default insurance, the provision by such institutions of prudent debt service reserves, and the furnishing by participating institutions for higher education and others of such additional guarantees of the education loans, Authority loans or the bonds as the Authority shall determine, all of such criteria to be established to assure the marketability of the bonds and the adequacy of the security for the bonds. The criteria governing the eligibility of institutions for higher learning shall include limitations upon the principal amounts and the terms of education loans, criteria regarding the qualifications and characteristics of borrowers and procedures for allocating authority loans among institutions of higher education eligible for its program in order to effectuate the purposes of the chapter;

(f1/2) to develop and administer one or more savings programs and to enter into tuition agreements on behalf of itself, the commonwealth, students, parents or any other private parties, all in cooperation with such other public and private parties and in accordance with such criteria or guidelines as the Authority shall deem appropriate to effectuate the purposes of this chapter. To the extent practicable, such savings program or programs shall provide students or parents an opportunity to participate conveniently and shall enable them to set aside relatively small amounts of money at a time and shall incorporate or be available in conjunction with, directly or indirectly, tuition agreements from as many institutions of higher education as feasible. To the extent practicable, and subject to the approval of the state treasurer, at least one such savings program shall include a college opportunity program, as described in section five A. In connection with any savings program or tuition agreement the Authority may accept and hold funds of students, parents, institutions of higher education or others, establish special accounts for such purposes and invest such funds in such manner as is authorized for Authority funds under section eighteen.

(g) to establish rules and regulations with respect to Authority loans, educational loans, savings programs and tuition agreements.

(h) to receive and accept from any source loans, contributions or grants for or in aid of an Authority education loan financing program or savings program or any portion thereof and, when desirable, to use such funds, property or labor only for the purposes for which it was loaned, contributed or granted;

(i) to contract with guarantors, financial institutions or other qualified loan origination and servicing organizations, which shall assist in prequalifying borrowers for education loans and which shall service and administer each education loan. The Authority may require that each borrower be charged a fee to defray the costs of origination, servicing and administration of education loans. The amount and method of collection of such fee shall be determined by the Authority. Participating institutions for higher education may perform these acts if authorized by the Authority;

(j) to contract with a guarantor to provide security for the payment of education loans through the issuance of default insurance or letters of credit or other credit arrangements or to provide a guarantee of payment covering all or a portion of each education loan made by or on behalf of the Authority or by or on behalf of an institution for higher education from the proceeds of an Authority loan.

(k) to employ attorneys, accountants, consultants, financial experts, loan processors, banks, managers, and such other employees and agents as may be necessary in its judgment, and to fix their compensation;

(l) to make direct education loans or to purchase education loans from or to make Authority loans to participating institutions for higher education or financial institutions and require that the proceeds of such Authority loans be used for making education loans, funding reserves, providing for capitalized interest and paying other costs and fees involved in making education loan or issuing bonds.

(l1/2) to sell education loans or Authority loans to such buyers on such terms and in such amounts as the Authority may determine.

(m) to charge and equitably apportion among participating institutions for higher education its administrative costs and expenses incurred in the exercise of the powers and duties granted by this chapter;

(n) to borrow working capital funds and other funds as may be necessary for start-up and continuing operations, as long as such funds are borrowed in the name of the Authority only. Such borrowings shall be limited obligations of the character described in section twelve and shall be payable solely from revenues of the Authority or the proceeds of bonds pledged for that purpose;

(o) notwithstanding any other provisions in this chapter, to commingle and pledge as security for one or more series or issues of bonds, only with the consent of all of the institutions of higher education which are participating in such series or issues, (a) the education loan series portfolios and some or all future education loan series portfolios of such institutions of higher education; and (b) the loan funding deposits of such institutions. Bonds may be issued in series under one or more resolutions or trust agreements in the discretion of the Authority.

(p) to examine records and financial reports of participating institutions for higher education, and to examine records and financial reports of any person, organization or institution retained under clauses (i), (j) or (k) of this section;

(q) to do all things necessary or convenient to carry out the purposes of this chapter.

In carrying out the purposes of this chapter, the Authority may issue bonds the proceeds of which are loaned to two or more participating institutions for higher education or for any combination of participating institutions for higher education and, thereupon all other provisions of this chapter shall apply to and for the benefit of the Authority and the participants in such joint project or projects. Any such joint participation requires the express approval of all participants.

The Authority shall require that Authority loans be used solely for the purpose of education loans and in an amount not to exceed the total cost of attendance, as defined by the Authority, less other forms of student assistance. The Authority shall require that institutions for higher education shall insist that each borrower under an education loan shall use the proceeds solely for educational purposes and purposes reasonably related thereto and that each such borrower shall so certify.

Whenever refunding bonds are issued to refund bonds the proceeds of which were used to make Authority loans, the Authority may reduce or increase the amount it is owed by the institution for higher education which had received Authority loans from the proceeds of the refunded bonds. Such institutions of higher education may reduce or increase the amount of interest being paid on education loans which the institution has made pursuant to the Authority loans from the proceeds of the refunded bonds.