The Perkins regulations concerning Peace Corps deferments have been amended. The changes are effective July 1, 2000, although, some of the changes may be implemented on or after October 25, 1999. The full text of the changes are available in the Federal Register (Volume 64, Number 205). Briefly, Peace Corps volunteers who are ineligible for deferment or cancellation of their federal student loans based solely on Peace Corps service to automatically qualify for economic hardship deferments while they are serving in the Peace Corps. Below is the summary of changes.

SUMMARY: The Secretary amends the Federal Perkins Loan and Federal Family Education Loan (FFEL) program regulations by adding criteria that allow Peace Corps volunteers who are ineligible for deferment or cancellation of their federal student loans based solely on Peace Corps service to automatically qualify for economic hardship deferments while they are serving in the Peace Corps. This change also applies to the William D. Ford Federal Direct Loan (Direct Loan) Program in accordance with Sec. 685.204(b)(3) of the Direct Loan Program regulations, which references the standards set forth in Sec. 682.210(s) of the FFEL Program regulations in establishing a Direct Loan borrower's eligibility for an economic hardship deferment.
      The Secretary also amends the Federal Perkins Loan Program regulations to eliminate the provision that requires a borrower to submit a request for a loan deferment, including a deferment in anticipation of cancellation, in writing.

DATES: Effective Date: These regulations are effective July 1, 2000.
      Implementation Date: The Secretary has determined, in accordance with section 482(c)(2)(A) of the Higher Education Act of 1965, that institutions that participate in the Federal Perkins Loan Program and lenders and guaranty agencies that participate in the FFEL Programs may, at their discretion, choose to implement the provisions of Secs. 674.34, 674.38, and 682.210 as amended by these final regulations, on or after October 25, 1999. For further information see ``Implementation Date of These Regulations'' under the SUPPLEMENTARY INFORMATION section of this preamble.

SUPPLEMENTARY INFORMATION: On September 17, 1998, the Secretary published a notice of proposed rulemaking (NPRM) for the Federal Perkins Loan Program and FFEL Program regulations in the Federal Register (63 FR 49798).
      The NPRM included a discussion of the issues surrounding the proposed changes that are not repeated here. The following changes were proposed:
      Amending Secs. 674.34(e)(2) and 682.210(s)(6)(ii) to add criteria that allow borrowers to qualify automatically for economic hardship deferments while they are serving in the Peace Corps.
      Amending Secs. 674.38(d) and 682.210(s)(6) to allow borrowers to receive economic hardship deferments for longer than a one-year period for each request while serving as Peace Corps volunteers.
      Amending Sec. 674.38(a) to eliminate the requirement that a borrower must submit a deferment or postponement request in writing.

Implementation Date of These Regulations

      Section 482(c) of the Higher Education Act of 1965, as amended (20 U.S.C. 1089(c)) requires that regulations affecting programs under title IV of the Act be published in final form by November 1 prior to the start of the award year in which they apply. However, that section also permits the Secretary to designate any regulation as one that an entity subject to the regulation may choose to implement earlier. If the Secretary designates a regulation for early implementation, he may specify when and under what conditions the entity may implement it. Under this authority, the Secretary has designated the following regulations for early implementation:
      Sections 674.34, 674.38 and 682.210--In Dear Colleague letter GEN- 98-16, the Secretary provided interim procedures to be used by FFEL loan holders and post-secondary institutions in granting economic hardship deferments to Peace Corps volunteers until final regulations were published. Institutions that participate in the Federal Perkins Loans Program and guaranty agencies and lenders that participate in the FFEL program may, now at their discretion, choose to implement the provisions of Secs. 674.34, and 682.210 upon October 25, 1999. Institutions that participate in the Federal Perkins Loan Program may implement the provisions of Sec. 674.38 that eliminate the written request for a deferment in the Perkins Loan Program upon October 25, 1999.
      These final regulations contain changes from the NPRM that are explained in the Analysis of Comments and Changes that follows.