PUBLIC LAW 99-498—OCT. 17, 1986
100 STAT. 1411
State agencies which the Secretary determines to be reliable authority as to the quality of education or training afforded. "(d) EuGiBLE LENDER.—
"(1) IN GENERAL.—Except as provided in paragraphs (2). through (5), the term 'eligible lender' means— "(A) a National or State chartered bank, a mutual savings bank, a savings and loan association, a stock savings bank, a trust company, or a credit union which— "(i) is subject to examination and supervision by an agency of the United States or of the State in which its principal place of operation is established, and "(ii) does not have as its primary consumer credit function the making or holding of loans made to students under this part unless (I) it is a bank which is wholly owned by a State, (II) it is a single wholly owned subsidiary of a bank holding company which does not have as its primary consumer credit function the making or holding of loans made to students under this part, or (III) it is a trust company which makes student loans as a trustee pursuant to an express trust and which operated as a lender under this part prior to January 1, 1981; "(B) a pension fund as defined in the Employee Retirement Income Security Act; "(C) an insurance company which is subject to examination and supervision by an agency of the United States or a State; "(D) in any State, a single agency of the State or a single nonprofit private agency designated by the State; ~' ' "(E) an eligible institution which meets the requirements of paragraphs (2) through (5) of this subsection; "(F) for purposes only of purchasing and holding loans made by other lenders under this part, the Student Loan Marketing Association or an agency of any State functioning as a secondary market; '(G) for purposes of making loans under sections 428A(d), 428B(d), 428C, and 439(q), the Student Loan Marketing Association; "(H) for purposes of making loans under sections 428(h) and 4280"), a guaranty agency; and "(I) a Rural Rehabilitation Corporation, or its successor agency, which has received Federal funds under Public Law 499, Eighty-first Congress (64 Stat. 98 (1950)). "(2) ADDITIONAL REQUIREMENTS OF ELIGIBLE INSTITUTIONS.—To
be an eligible lender under this part, an eligible institution— "(A) shall employ at least one person whose full-time responsibilities are limited to the administration of programs of financial aid for students attending such institution; and "(B) shall not be a home study school. "(3) DISQUALIFICATION FOR HIGH DEFAULT RATES.—The term 'eligible lender' does not include any eligible institution in any fiscal year immediately after the fiscal year in which the Secretary determines, after notice and opportunity for a hearing, that for each of 2 consecutive years, 15 percent or more of the total amount of such loans as are described in section 428(a)(l) made by the institution with respect to students at that institu-
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