164A.240 "Eligible borrower" defined -- Additional student loans permitted -- Administrative regulations -- Bonds to finance loans -- Maximum annual loan amount. - Kentucky Statutes

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164A.240 "Eligible borrower" defined -- Additional student loans permitted -- Administrative regulations -- Bonds to finance loans -- Maximum annual loan
amount. (1) (a) As used in this section, the term "eligible borrower" means a student, a former student, or the parent of a dependent student or former student, who
demonstrates an intention and capacity to repay an educational loan and meets
the loan criteria established by the promulgation of administrative regulations
by the corporation. (b) Notwithstanding KRS 164A.020, with respect to any educational loan made or financed under this section, and any bonds or notes of the corporation to
finance educational loans under this section, as used in KRS 164A.010 to
164A.240, the term:
1. "Eligible institution" shall be deemed to include any educational
institution approved by the corporation; 2. "Eligible lender" shall be deemed to include any financial institution
approved by the corporation; and 3. "Insured student loan" or "student loan" shall be deemed to include any
educational loan. (2) (a) In addition to the authority granted by KRS 164A.010 to 164A.240, the corporation is authorized to:
1. Establish, finance, and operate educational loan programs deemed
necessary by the Kentucky Higher Education Assistance Authority to
make or cause to be made educational loans to meet the financial needs
of eligible borrowers; and 2. Exercise any of its powers with respect to educational loans pursuant to
KRS 164A.010 to KRS 164A.240. (b) The corporation may, in connection with the program, enter into agreements with loan servicing organizations, guarantors, insurers, financial institutions,
eligible lenders, and eligible institutions. The educational loan programs may
provide for either the making of educational loans to eligible institutions and
the relending to eligible borrowers or the making and purchasing of
educational loans by the corporation. (3) The corporation may promulgate administrative regulations to implement the provisions of KRS 164A.010 to 164A.240. (4) The corporation may finance the educational loan programs through the issuance of its bonds or notes subject to the provisions set forth in KRS 164A.010 to 164A.240,
except that KRS 164A.080(3) shall not apply to any loans and KRS 164A.160 shall
not apply to any bonds or notes issued to fund loans authorized in this section. The
proceeds of the bonds or notes used for the educational loan programs may be
commingled with the proceeds of bonds or notes financing insured student loans as
defined by KRS 164A.020. The bonds or notes issued under the provisions of this
subsection shall be special and limited obligations, payable solely and only from the receipts pledged and shall not constitute an indebtedness or liability of the
Commonwealth or a pledge of the faith and credit of the Commonwealth. (5) The corporation may establish reserve funds or replacement funds in connection with the issuance of bonds and notes for educational loan purposes as determined to
be necessary by the board to enable the corporation to accomplish its proper public
purposes. (6) (a) The maximum annual loan amount shall not exceed: 1. The costs incurred by the eligible borrower related to attendance less
other financial aid, as certified by the eligible institution; 2. The repayment amount of loans to fund the borrower's cost; or 3. A lesser amount established by the board. (b) The loan proceeds shall be used by the eligible borrower solely for these purposes. (7) The corporation may issue taxable bonds or notes for the financing of any program authorized by this chapter. (8) The Kentucky Higher Education Assistance Authority shall provide the services as the corporation may require to efficiently carry out the purposes of this section. (9) A person under the age of eighteen (18) years shall be deemed to have full capacity to act and shall have all rights, powers, privileges, and obligations of a person of
full age for the purpose of applying for, receiving, and repaying educational loans
authorized pursuant to this section. Notwithstanding any other statute to the
contrary, a repayment obligation imposed by this section shall not be voidable by
reason of the age of the recipient at the time of receiving the educational loan. (10) The corporation shall establish the interest rates and other terms and conditions for educational loans in a manner that it determines is financially sound. No provision
of any other law of the Commonwealth of Kentucky that limits the rate or amount
of interest payable on a loan shall apply to an educational loan authorized by this
section. (11) A loan made pursuant to this section shall be governed by Kentucky law.
(12) KRS 164.772, KRS 164.774, and KRS 131.565 are applicable to loans made pursuant to this section. Effective: June 24, 2003
History: Amended 2003 Ky. Acts ch. 8, sec. 1, effective June 24, 2003; and ch. 115, sec. 5, effective June 24, 2003. -- Repealed, reenacted, and amended as KRS 164A.240, 1988 Ky. Acts ch. 35, sec. 1, effective July 15, 1988. -- Created 1982 Ky.
Acts ch. 403, sec. 8, effective July 15, 1982. Formerly codified as KRS 164.755
Legislative Research Commission Note (6/24/2003). This section was amended by 2003 Ky. Acts chs. 8 and 115, which do not appear to be in conflict and have been
codified together.