[26 Pa.B. 3321]
[Continued from previous Web Page] § 121.32. Approved institutions in Higher Education Grant Program.
(a) To be eligible for a State higher education grant, an applicant shall enroll in a program approved under § 121.33 (relating to approved program of study in Higher Education Grant Program) and shall attend an institution of higher education approved by the Agency for enrollment of grant recipients under the State Higher Education Grant Program.
(b) To be approved, an institution shall be other than a school of theology or a theological seminary as determined by the Agency, shall be located in the United States, the Canal Zone, Puerto Rico, the Virgin Islands, American Samoa or Guam and shall comply with the following:
(1) If the institution is a college or university located within this Commonwealth, the institution shall be approved by the Department of Education and shall be accredited or a recognized candidate for accreditation with an accrediting body recognized by the Commission on Recognition of Postsecondary Accreditation; if the college or university is located outside this Commonwealth, the institution shall be degree-granting, shall be operated not-for-profit and shall be fully accredited by the regional institutional accrediting body recognized by the Commission on Recognition of Postsecondary Accreditation responsible for accreditation in the state where the college or university is conducting its educational program.
(2) If the institution is a hospital school of nursing located within this Commonwealth, the institution shall be initially, provisionally or fully approved by the State Board of Nursing and shall be accredited by the National League for Nursing; if located outside this Commonwealth, the institution shall be accredited by the National League for Nursing.
(3) If the institution is a trade, technical or business school located within this Commonwealth, the institution shall be approved by the Department of Education or shall currently be, and shall have been throughout the preceding 24 months, licensed by the State Board of Private Licensed Schools and shall be accredited by an accrediting body recognized by the Commission on Recognition of Postsecondary Accreditation, except that this requirement for licensure and accreditation may be waived by the President and Chief Executive Officer for branch campuses of an institution that has been operating satisfactorily in this Commonwealth for 2 years or more; if the institution is located outside this Commonwealth, it shall be degree-granting, shall be operated not-for-profit and shall be fully accredited by the regional institutional accrediting body recognized by the Commission on Recognition of Postsecondary Accreditation responsible for accreditation in the state where the institution is conducting its educational program.
(4) The institution shall have executed an Assurance of Compliance with section 602 of the Civil Rights Act of 1964 (42 U.S.C.A. § 2000d-1 (1974)) and filed it with the United States Secretary of Education.
(5) The institution shall have executed and filed with the Agency an agreement on a form provided by the Agency to report or advise the Agency if the institution has knowledge of the name and address of Commonwealth resident students who are recipients of Agency-administered aid who have been convicted in a court of record of a criminal offense which under the laws of the United States or of the Commonwealth would constitute a felony committed after October 29, 1969. Institutional knowledge shall be facts contained in the academic, disciplinary or financial student records of the institution and facts known to the dean of students, director of financial aid and president of the institution or persons occupying these positions by whatever titles designated by the institution.
(6) When a change in ownership of an approved institution occurs, the new owner shall notify the Agency in writing of the change in ownership within 30 days of the effective date of the change. The new owner shall execute and file with the Agency an agreement on a form provided by the Agency to assume responsibility for repayment of State grant funds to the Agency or payment of State grant funds to eligible students, as designated by the Agency, made necessary by the failure of the previous owner to follow Agency procedures and requirements. An institution that fails to execute this agreement will be required to wait 24 months before being considered for approval in the State Grant Program.
(7) The institution shall comply with other administrative requirements the Agency may legally promulgate, as shall be set forth in the State Grant Certification Procedures and the State Grant Program Policy Manual which will be made available to institutions on an annual basis.
(c) Approved institutions for an academic year shall be those on record as of the preceding August 1 for the ensuing academic year.
(d) Approval of an institution after August 1 will become effective the following August 1 with two exceptions:
(1) To be effective for the ensuing summer term, approval shall be obtained prior to May 1.
(2) In light of the particular circumstances related to the institution's approval and the funding and application processing conditions of the Agency, the President and Chief Executive Officer may make the approval effective on a date prior to August 1.
(e) The President and Chief Executive Officer may suspend the processing of aid request forms of State grant applicants or cease further disbursement of State grant funds to an approved institution, or both, when, in the judgment of the President and Chief Executive Officer, the institution's compliance with the conditions required for approval or the institution's continued eligibility or operation is in question and the action is deemed necessary to protect the interests of the student aid applicants, the Commonwealth or the Agency. This subsection may also be invoked upon a change in ownership, administration or directorship of the institution.
(f) An institution's approved status may be terminated by the President and Chief Executive Officer when any of the conditions required for approval cease to be met.
(g) In suspending or withdrawing the approval of an institution, the President and Chief Executive Officer may authorize continuation of eligibility determination and grant disbursement for State grant renewal applicants.
§ 121.34. Institutional appeals and hearings (for other than the Federal Family Education Loan Programs).
(a) If the President and Chief Executive Officer suspends the processing of student aid request forms for students at an approved institution or ceases disbursement of funds to an approved institution, the institution will be notified in writing of the action and the grounds therefor and will be afforded an opportunity to contend to the Agency that the processing of aid request forms or disbursement of funds should be resumed and to submit relevant data in support of this contention.
(b) If the President and Chief Executive Officer of the Agency determines that an institution is not an eligible institution within the meaning of this chapter for a program administered by the Agency, the institution will be notified in writing of the determination, the grounds therefor and its right to appeal from the decision.
(c) An institution which is aggrieved by the determination of the President and Chief Executive Officer that it is not an eligible institution may file an appeal of that determination to the Board. This subsection supersedes 1 Pa. Code § 35.20 (relating to appeals from actions of the staff).
(d) An appeal shall be filed on or before the 15th day after the date on which notification of the determination by which the institution was aggrieved was mailed to it at its post office address registered with the Agency.
(e) The appeal may be heard by the Board or, at its direction, by a hearing examiner appointed by the Chairperson of the Board or, in the event of the unavailability of the Chairperson, by the Vice Chairperson of the Board, from a list maintained by the President and Chief Executive Officer. The hearing examiner or the Board will schedule the appeal for hearing within 30 days from the date on which the appeal is filed and will give the institution at least 7 days' notice of the hearing. The notice will specify the date, hour and place of hearing.
(f) Hearings will be held at the offices of the Agency in Harrisburg, Pennsylvania. During the hearing, the institution will be given the opportunity to submit relevant evidence in support of its contentions. The institution shall also have the right to present oral and written argument and to cross-examine witnesses which are offered by the Agency. This subsection supplements 1 Pa. Code § 35.126 (relating to presentation by the parties).
(g) The hearing examiner or the Board will prepare or cause the preparation of a verbatim transcript of the hearing. When the appeal is heard by a hearing examiner, findings of fact and conclusions of law shall also be prepared, and the transcript, findings and conclusions shall be forwarded directly to the Board for review and a final decision by the Board. This subsection supplements 1 Pa. Code § 35.131 (relating to recording of proceedings) and supersedes 1 Pa. Code § 35.202 (relating to proceedings in which proposed reports are prepared).
(h) The Board will make an order or determination as shall appear just and proper from all the evidence submitted. Notice of the decision of the Board will be mailed promptly to the institution at the post office address which is registered with the Agency.
(i) The decision of the Board will become final 10 days after the date thereof. Within 30 days after the decision of the Board becomes final, the institution may file an appeal therefrom with Commonwealth Court.
§ 121.35. Payment of interest on Federal Stafford Loans and Federal PLUS Loans.
(a) The Agency will require an educational institution to repay to the appropriate lending institution the interest that has accrued on Federal Stafford Loan or Federal PLUS Loan funds under the following circumstances:
(1) A borrower receives loan assistance for which he is not eligible because of the educational institution's negligent or willful false certification of a student's loan eligibility.
(2) If the educational institution violates State or Federal regulations in its release of Federal Stafford Loan or Federal PLUS Loan funds to a borrower.
(3) If the educational institution is required to make a loan refund as specified in Federal regulations and does not make the refund within the time frame specified in the regulations.
(b) The interest amount that the Agency will require to be repaid under the circumstances described in subsection (a) will be based on the maximum interest rate allowed under Federal law governing the particular loan and will be calculated over the following time periods:
(1) For the condition described in subsection (a)(1), from the date of disbursement of the loan funds until the date the ineligible principal portion is repaid.
(2) For the condition described in subsection (a)(2), from the date of release of the loan funds until the date the principal portion of the loan funds in question is repaid.
(3) For the condition described in subsection (a)(3), from the latest date, as specified in Federal regulations, that a refund should have been made until the date the refund actually is made.
(c) Educational institutions required to pay interest will receive written notice as to the reason the interest is owed and the amount to be remitted to the Agency. The educational institution will have a maximum of 60 days from the date of the written notice to respond to the Agency.
(d) Failure of the educational institution to respond to the notice specified in subsection (c) or to repay the particular interest amount requested will lead the Agency to refer the case to the United States Secretary of Education for further enforcement action.
Subchapter B. HIGHER EDUCATION GRANT PROGRAM § 121.44. Required family financial data.
(a) General. The applicant, the applicant's parents and stepparents, and the applicant's spouse shall submit financial data that the Agency requests and, further, shall be required to authorize the Director of the State Personal Income Tax Bureau and the District Director of theInternal Revenue Service to release to the Agency, upon request of the Agency, a copy or extract of the State or Federal Income Tax Return filed by the applicant, the applicant's parents and stepparents, and the applicant's spouse for the tax years the Agency designates. The Agency may in addition require the applicant, the applicant's parents and stepparents, and the applicant's spouse to submit a copy of the tax returns directly to the Agency.
(b) Exceptions. The Agency may determine the eligibility of the applicant without regard to the parents' financial data, waiving its submission, in the following cases:
(1) If the applicant is a veteran as defined in § 121.1 (relating to definitions).
(2) If the applicant is at least 24 years of age by January 1 prior to the academic year for which application is made.
(3) If the applicant is an orphan or ward of the court.
(4) If the applicant is married or separated.
(5) If the applicant has legal dependents other than a spouse.
(6) If the applicant is in compliance with other criteria established by the Agency for the processing of applicants without regard to parental financial data.
(7) Other exceptions may be granted by the Administrative Review Committee or the Committee on Appeals in turn on an individual case basis.
(c) Severe casualty losses. If, as a result of fire, storm or other casualty, the family of a higher education grant applicant has suffered severe losses not fully covered by insurance, the post-loss value of assets normally taxed in the eligibility determination may be used in processing the application in order to reflect the family's reduced ability to finance educational costs. If the family's loss is covered by insurance (whether fully or partially), the Agency, in processing the application, may elect to use either the preloss value of the assets or the insurance benefits received because of the loss. If the loss is not fully covered by insurance, the Agency may also elect to subtract from family income the amount of the casualty losses not covered by insurance, to waive the normal application filing deadline and to afford other special treatment of the application that may be merited.
§ 121.49. Duration of State higher education grants.
(a) State higher education grants are awarded for undergraduate school study and student eligibility shall terminate with the receipt of the baccalaureate degree or 4 undergraduate academic year State higher education grants, whichever occurs first, except as provided in subsections (b)--(d).
(b) In the case of students enrolled in Agency-approved bona fide 5-year programs of study in approved institutions, student eligibility shall terminate with the receipt of the baccalaureate degree or 5 academic year State higher education grants, whichever occurs first.
(c) In the case of students enrolled in Agency-approved 5-year work study programs in approved institutions, student eligibility shall terminate with the receipt of the baccalaureate degree or 5 academic year State higher education grants, whichever occurs first. However, the total higher education grant funds awarded during 5 years will not exceed the amount to which the student would have been entitled as determined by the Agency had his educational program been completed in a period of 4 years.
(d) State higher education grant eligibility for undergraduate students enrolled in other than baccalaureate degree programs shall terminate with the receipt of 4 academic year State higher education grants or with the end of the normal course of study, whichever occurs first.
§ 121.50. Disbursement of State higher education grants.
(a) Payments on behalf of students of their State higher education grants to institutions on a semester or trimester calendar shall be made twice during the academic year in an amount equal to 1/2 of the annual grant. Similar payments to institutions on a quarter calendar shall be made three times during the academic year in an amount equal to 1/3 of the annual grant. Grants shall be sent to the appropriate institution to the credit of the account of the recipient for payment of tuition, room, board, books or institutional fees. Payments may be made to the recipients when the Agency deems the action necessary to protect the interests of the students, the Commonwealth or the Agency.
(b) Students who accelerate their academic progress by reason of attendance in a year-round program of study shall be eligible to receive additional payments of their State higher education grant but in no event may the payments result in violation of § 121.49 (relating to duration of State higher education grants).
§ 121.55. Recipients on probation.
A recipient placed on academic or disciplinary probation shall remain eligible for a higher education grant if the institution of higher learning permits him to continue his studies on at least a half-time basis.
Subchapter C. FEDERAL STAFFORD LOAN PROGRAMS § 121.61. Submission and processing of applications.
(a) Applicant. A student desiring to secure a Federal Stafford Loan shall obtain from a participating lender, a participating school or Agency a loan application packet containing the application/promissory note form for the Federal Stafford Loan Program. The information provided on the form will be used to determine the eligibility of the applicant to receive a Federal Stafford Loan. The applicant shall complete the loan application, which includes the affidavit in which the applicant agrees to use the loan proceeds solely for educational expenses. The applicant shall also read, sign and date the promissory note that is part of the loan application form. After completing the loan application, including the promissory note, the applicant shall retain a copy of the form and forward the remaining copies of these forms as referenced on the form.
(b) Educational institution. The institution shall certify the loan application according to instructions provided by the Agency.
(c) Processing by the Agency. The Agency will check the application/promissory note form for completeness. If not complete, the Agency will obtain from the applicant the missing data items.
(d) Completion of processing. Upon receipt of missing information, the Agency will complete the processing of the loan application and determine the amount of loan assistance the applicant is entitled to obtain. The Agency will then inform the lender of the amount of the guaranty by sending the lender a Loan Guaranty Notice and Disclosure Statement.
(e) Action by lender. The lender shall provide the applicant with a copy of the Loan Guaranty Notice and Disclosure Statement and disburse the funds by means of a check or electronic funds transfer. If the lender does not wish to make the loan, the lender shall mark denied on the Loan Guaranty Notice and Disclosure Statement or report the denial by the computer terminal. An adverse action notice shall be provided to the borrower by the lender if loan assistance is denied.
§ 121.65. Federal Stafford Loan guaranty limits.
The Agency will guarantee loans to the maximum amounts specified in the following table:
Subsidized/ Additional Unsubsidized Eligibility Unsubsidized Loan for Independent Students* Annual Loan Limits: 1st Year Undergraduate: $2,625 $4,000 Full academic year $1,750 $2,500 2/3 academic year $ 875 $1,500 1/3 academic year 2nd Year Undergraduate: Full academic year $3,500 $4,000 2/3 academic year Prorated** $2,500 1/3 academic year Prorated** $1,500 3rd Year, 4th Year or 5th Year Undergraduate: Full academic year $5,500 $5,000 Less than full academic year Prorated** Prorated** Graduate/Professional Student $8,500 $10,000 Aggregate Limits: Undergraduate $46,000 Graduate/Professional $138,500 (includes borrowings at the undergraduate level) * Or dependent students whose parents cannot borrow a Federal PLUS loan. The amount an independent student or eligible dependent student can borrow under the unsubsidized Federal Stafford Loan Program during an academic year is: (a) the amount indicated in the first column minus the subsidized loan amount for which the student is eligible, plus (b) the amount indicated in the second column.
**Straight proration applies if the final portion of the program of study is less than a full academic year. The prorated loan amount must bear the same ratio to the full-academic year loan amount as the remainder of the program bears to 1 academic year.
§ 121.66. (Reserved).
§ 121.69. Cancelled debt.
The indebtedness of a borrower who dies, who becomes totally and permanently disabled, whose loans are discharged in bankruptcy, who is enrolled at an institution that closes or who has his eligibility to borrow falsely certified by the institution, shall be cancelled upon the acceptance of proper documentation by the lender or holder of the loan.
§ 121.70. Default.
Except as otherwise provided in § 121.67 (relating to repayment), a note shall be declared in default at the following times:
(1) One hundred eight days, or as otherwise established by the Agency to comply with Federal statutes or regulations, after the date on which a monthly payment was scheduled to be made by a student borrower under a repayment schedule, if the borrower fails to make the monthly payment within 180 days of its due date, or as otherwise established by the Agency to comply with Federal statutes or regulations.
(2) Two hundred forty days, or as otherwise established by the Agency to comply with Federal statutes or regulations, after the date on which a quarterly payment of nonsubsidized interest was scheduled to be made by a student borrower under a quarterly interest repayment schedule, if the borrower fails to make the quarterly payment within 240 days of its due date, or as otherwise established by the Agency to comply with Federal statutes or regulations.
§ 121.72. Loan residency.
(a) A student applicant shall be a resident of this Commonwealth at the time the student applies for a Federal Stafford Loan or to renew a loan guaranty. Establishment of residency may be based upon any one of the following:
(1) A student applicant who is under 18 years of age at the time the student applies for a Federal Stafford Loan or to renew a loan guaranty shall have a supporting parent or guardian who has been a bona fide domiciliary of this Commonwealth for at least 30 days immediately preceding the date of receipt by the Agency of the loan guaranty application or renewal application.
(2) A student applicant who is 18 years of age or older at the time the student applies for a Federal Stafford Loan or to renew the guaranty shall have been a bona fide domiciliary of this Commonwealth for at least 30 days immediately preceding the date of receipt by the Agency of the loan guaranty application or renewal application.
(3) A student applicant who is accepted for enrollment in or is attending an approved institution of higher education located in this Commonwealth is considered a bona fide domiciliary of this Commonwealth except in cases where the student is enrolled in a correspondence (home study) course, in which case the student shall be a bona fide domiciliary of this Commonwealth as described in paragraphs (1) and (2).
(b) For purposes of determining domicile, a guardian shall be one of the following:
(1) A person appointed by a court.
(2) A person other than a parent with whom the applicant has lived and in whose continuous direct care and control the applicant has been for at least 2 years.
(c) Military status of persons and their dependents who reside in the civilian community rather than on a military installation will not alone be grounds for determining an applicant ineligible.
(d) Persons and their dependents who leave this Commonwealth on military or foreign assignments, such as missionaries, United States military service personnel and representatives of domestic companies or government agencies, shall be presumed to maintain their domicile in this Commonwealth for purposes of satisfying the loan guaranty residence requirement.
(e) In the case of a student attending an institution of higher education in another state who is under 18 years of age whose parents or guardians move from this Commonwealth after the agency has issued a loan guaranty, the eligibility of the applicant continues to the end of the applicant's program of study.
(f) A student who transfers to an approved institution of higher education located outside of this Commonwealth after having received guaranteed student loan assistance while attending a Commonwealth institution of higher education is eligible to have the loan guaranty renewed.
(g) A student applicant filing a loan guaranty renewal application who has outstanding loans with the Agency and whose domicile has changed from this Commonwealth due to the relocation of the applicant or supporting parents or guardian shall continue to be eligible for guaranteed student loan assistance until the end of the applicant's program of study.
(h) The Agency will make the final decision in all matters pertaining to residency or domicile, or both.
Subchapter G. INSTITUTIONAL ASSISTANCE GRANTS PROGRAM § 121.121. Application of existing agency regulations.
The Agency higher education grant regulations contained in Subchapters A, B and F (relating to general provisions; Higher Education Grant Program; and POW/MIA's Education Program) apply to the determination of eligible recipients for the accounting of funds to be disbursed to each eligible institution of higher learning in the Institutional Assistance Grants Program, except those regulations which are inconsistent with this subchapter.
§ 121.123. Determination of institutional assistance grants.
(a) Institutional assistance grants, established by dividing the total funds available for institutional grants in this program by the number of Pennsylvania State grant recipients certified to the Agency by the participating institutions, will be paid to an eligible institution in either a lump sum or in installments at the discretion of the Agency. The institutional assistance grants shall be in a number equal to the number of full-time students receiving assistance from the Pennsylvania Higher Education Grant Program or the POW/MIA's Education Program certified as enrolled during the academic year except those intra-year transfer students from any other eligible institution. The following are examples:
(1) If a student enrolls in eligible institution A, the institution shall receive an institutional assistance grant by reason of the enrollment if, as of the date of the Eligibility Certification Listing, the student either had been enrolled at least half time for at least one complete semester, trimester or quarter of the academic year or is enrolled at least half time for the current semester, trimester or quarter.
(2) If a student enrolls in eligible institution B during the academic year as a transfer student from an institution other than an eligible institution, institution B shall receive an institutional assistance grant by reason of the enrollment if, as of the date of the Eligibility Certification Listing, the student had been enrolled at least half time for at least one complete semester, trimester or quarter of the academic year or is enrolled at least half time for the current semester, trimester or quarter.
(3) If a student enrolls in eligible institution B during the academic year as a transfer student from eligible institution A, institution B will not receive an institutional assistance grant during the academic year if by reason of the student's enrollment an institutional assistance grant has been paid or will be paid to eligible institution A by reason of the student's previous enrollment in institution A during the same academic year.
(b) For purposes of this section, an Eligibility Certification Listing is defined as a listing created by the Agency for the institution to use in certifying the enrollment of students for the purpose of determining the institution's enrollment to institutional assistance grants.
§ 121.124. Participation agreement.
(a) Each participating institution shall execute through its authorized representative an Agreement with the Agency which shall contain the following:
(1) Assurance that auditable records are maintained.
(2) Assurance against discrimination of any Commonwealth resident applicant for admission because the applicant does not apply or qualify for assistance under the Pennsylvania Higher Education Grant Program or the POW/MIA's Education Program.
(3) Assurance that institutional assistance grant moneys will only be used for, or in connection with, expenses incurred for educational costs other than expenses for sectarian and denominational instruction, the construction or maintenance of sectarian and denominational facilities, or for any other sectarian and denominational purpose or activity.
(b) To be entitled to share in the distribution of the Institutional Assistance Grants Program funds of a particular fiscal year, an institution shall have submitted a properly signed participation agreement to the Agency by August 1 of that same fiscal year. The President and Chief Executive Officer may extend this deadline if an extension would not cause undue interference with the operation of the Institutional Assistance Grants Program, though an institution may not share in the Institutional Assistance Grants Program funds of a particular fiscal year if that institution has not submitted a properly signed participation agreement to the Agency by the time of the first disbursement of the Institutional Assistance Grants Program funds of that particular fiscal year.
Subchapter H. FEDERAL PLUS PROGRAM § 121.131. Submission and processing of applications.
(a) Applicant. A parent of a dependent student desiring to secure a guaranty of a Federal PLUS Loan shall obtain from a participating lender, a participating school or Agency a loan application packet containing the application/promissory note form for the Federal PLUS Loan. The information provided on the form will be used to determine the eligibility of the applicant to receive a PHEAA Federal PLUS Loan. The student for whom the loan funds shall be used to meet educational expenses shall complete the information requested on the student's portion of the Federal PLUS Loan application, including the affidavit in which the student authorizes the school and the lender named on the Federal PLUS Loan application form to release information contained in the student's file that is relevant to the eligibility of the student for the Federal PLUS Loan Program. The applicant shall complete the appropriate section of the application, including the affidavit in which the applicant agrees to use the loan proceeds solely for the educational expenses of the student named in the application. The applicant shall also read, sign and date the promissory note included on the loan application form. After completing the appropriate section of the Federal PLUS Loan application form, the applicant shall retain one copy of the form and forward the remaining copies of the application/promissory note form as referenced on the form.
(b) Educational institution. The institution shall certify the Federal PLUS Loan application according to the instructions provided by the Agency.
(c) Processing by the Agency. The Agency will check the application/promissory note form for completeness. If not complete, the Agency will obtain from the applicant the missing data items.
(d) Completion of processing. Upon receipt of missing information, the Agency will complete the processing of the loan application and determine the amount of loan assistance the borrower is entitled to obtain. The Agency will inform the lender of the amount of the guaranty by sending the lender the appropriate Loan Guaranty Notice and Disclosure Statement.
(e) Action by lender. The lender shall provide the applicant with a copy of the Loan Guaranty Notice and Disclosure Statement and disburse the funds by means of a check or electronic funds transfer. If the lender does not wish to make the loan, the lender shall mark ''Denied'' on the Loan Guaranty Notice and Disclosure Statement or report the denial of the loan by the computer terminal. An adverse action notice shall be provided to the borrower by the lender if loan assistance is denied.
§ 121.135. Federal Plus Loan guaranty limits.
The Agency will guarantee a Federal PLUS Loan for the difference between cost minus other financial assistance.
§ 121.136. (Reserved).
§ 121.137. Repayment.
(a) A Federal PLUS Loan is due for repayment within 60 days of the date of the final disbursement of the loan.
(b) A borrower shall repay in substantially equal monthly installment payments at least $600 per year, including principal and interest. If the total of the insured loans would not be repaid in less time with minimum payments of $600 per year, the repayment schedule shall provide for repayment in not less than 5 years, nor more than 10 years. The lender and the borrower may agree to monthly payments of less than $50 over not more than a 10-year repayment schedule.
(c) Upon proper notice to the lender, repayment of principal may be deferred in accordance with, and during periods specified in, the Higher Education Act of 1965 (Pub. L. No. 89-329, 79 Stat. 1219) and Federal regulations based on this act. The borrower is responsible for the interest that accrues during any period principal repayment is deferred.
§ 121.139. Cancelled debt.
The obligation to repay the indebtedness of a Federal PLUS Loan borrower who dies, who becomes totally and permanently disabled, whose loans are discharged in bankruptcy or who has his eligibility to borrow falsely certified by the school, shall be cancelled upon the acceptance of proper documentation by the lender or holder of the loan. The obligation to repay the indebtedness of a Federal PLUS Loan borrower shall be cancelled upon the acceptance of proper documentation by the lender or holder of the loan of the death of the student on whose behalf the parent borrowed the Federal PLUS Loan or closure of the school at which the student on whose behalf the parent borrowed the Federal PLUS loan is enrolled.
§ 121.140. Default.
Except as otherwise provided in § 121.137 (relating to repayment), a note shall be declared in default at the following times:
(1) One hundred eighty days after the date on which a monthly payment was scheduled to be made by the borrower under a repayment schedule, if the borrower fails to make the monthly payment within 180 days after its due date.
(2) Two hundred forty days after the date on which a quarterly payment of interest was scheduled to be made by the borrower under a quarterly interest payment schedule, if the borrower fails to make the quarterly payment within 240 days after its due date.
§ 121.141. Loan residency.
(a) A parent applicant shall, at the time the parent applies for a Federal PLUS Loan or to renew a Federal PLUS Loan guaranty, be a resident of this Commonwealth. The parent applicant, to be considered a resident of this Commonwealth, shall be the parent of a student who is accepted for enrollment in or is attending an approved institution of higher education located in this Commonwealth. In the case of the parent of a student who is enrolled in or attending a non-Pennsylvania school or participating in a correspondence (home study) course through a Pennsylvania institution, the parent applicant shall be a bona fide domiciliary of this Commonwealth for at least 30 days immediately preceding the date of receipt by the Agency of the Federal PLUS Loan application to obtain a loan for such a student.
(b) For purposes of determining domicile, a guardian is:
(1) A person appointed by a court.
(2) A person other than a parent with whom the applicant has lived and in whose continuous direct care and control the applicant has been for at least 2 years.
(c) Military status of persons and their dependents who reside in the civilian community rather than on a military installation may not alone be grounds for determining an applicant ineligible.
(d) Persons and their dependents who leave this Commonwealth on military or foreign assignments, such as missionaries, United States military service personnel and representatives of domestic companies or government agencies, shall be presumed to maintain their domicile in this Commonwealth for the purposes of satisfying the Federal PLUS Loan guaranty residency requirement.
(e) In the case of a parent borrower who moves from this Commonwealth after the Agency has issued a loan guaranty for the academic year for a student attending an institution of higher education in another state, the loan guaranty eligibility of the applicant shall continue to the end of the student's program of study.
(f) If a student transfers to an approved institution located outside of this Commonwealth after the borrower for the student has received loan assistance while the student was attending a Commonwealth institution of higher education, the borrower for the student is eligible to have the loan assistance renewed.
(g) The Agency will make the final decision in all matters pertaining to residency or domicile, or both.
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