---
kind: "section"
citation: "7 C.F.R. § 765.102"
title: "7"
number: "765.102"
heading: "Borrower non-compliance with graduation requirements."
url: "https://uscodex.org/cfr/7/765.102"
---

# §765.102. Borrower non-compliance with graduation requirements.

- (a) Borrower failure to fulfill all graduation requirements, including failure to submit information as specified in [§ 765.101(c)](/cfr/7/765.101.md?p=c) of this chapter, within the time-period specified by the Agency constitutes default on the loan. Except as provided in [paragraph (b)](#b) of this section, the Agency will accelerate the borrower's loan without offering servicing options provided in [7 CFR part 766](/cfr/7/part766.md) if any outstanding direct loan was closed prior to September 25, 2024.
- (b) If all outstanding direct loans were closed after September 25, 2024, or when the borrower makes a written request in response to the Agency's notification of intent to accelerate within provided timeframes, the Agency will convert the debt to a non-program loan under the following conditions:
  - (1) It is in the interest of the Agency;
  - (2) The debt will be subject to the interest rate for non-program loans in effect at the time of default;
  - (3) The debt will be serviced as a non-program loan; and
  - (4) The term of the non-program loan will be:
    - (i) For FOs, the Agency will schedule repayment in equal installments over the lesser of the remaining number of years on the loan, the useful life of security, or 25 years.
    - (ii) For OLs, the Agency will schedule repayment in equal installments over the lesser of the remaining number of years on the loan, the useful life of security or 5 years.

## Notes

### Amendments

[89 FR 65042, Aug. 8, 2024]

### Authority

Authority: 5 U.S.C. 301 and 7 U.S.C. 1989.

### Source

Source: 72 FR 63309, Nov. 8, 2007, unless otherwise noted.

### Amendments

[89 FR 65042, Aug. 8, 2024]