§ 692. Education loans; special requirements. In any year in which\nfixed rate education loans are to be acquired using the proceeds of\nbonds issued by the state of New York mortgage agency or other public\nbenefit corporation authorized to issue bonds for the purposes of this\nprogram, preference shall be given to education loans made to eligible\nborrowers for the benefit of students who demonstrate financial need\nbased on such student's family gross income, pursuant to rules and\nregulations promulgated by the corporation after consultation with the\nstate of New York mortgage agency or other public benefit corporation\nauthorized to issue bonds for the purposes of this program. 1. Terms and\nconditions. (a) eligible borrowers shall apply for education loans under\nthis program on forms prescribed by the corporation;\n (b) except as may be provided by regulation, a student for whom an\neducation loan is made shall be required to first apply for and exhaust:\n(i) their maximum eligibility of loans under the Federal Family\nEducation Loan Program (FFELP) and the Federal Direct Student Loan\nProgram (FDSLP), excluding PLUS loans; (ii) any other federal student\naid, other than HEAL loans and other aid permitted by the corporation to\nbe excluded; (iii) any state student aid; and (iv) any other student aid\nas prescribed by the corporation before being eligible for any education\nloan under this program;\n (c) borrowers shall successfully complete a financial literacy course\nas prescribed by the corporation;\n (d) student borrowers must apply for education loans under this\nprogram with an eligible co-signer;\n (e) a borrower, or co-signer, who is in default on an education loan\nmade under this program, the Federal Family Education Loan Program, the\nWilliams D. Ford Program, or has failed to comply with the terms and\nconditions of any award under this article and has failed to\nsatisfactorily cure such default or non-compliance as prescribed by\napplicable law or regulation shall be ineligible to receive a loan under\nthis program, and shall further be ineligible for any other state\nstudent aid while in default on an education loan made under this\nprogram; and\n (f) participating eligible colleges, lending institutions, and other\nparticipants in this program shall be required to enter into a\nparticipation agreement with the corporation and comply with all\nreporting and processing requirements and procedures as established by\nthe corporation. These participation agreements shall contain such other\nspecific terms and conditions of the program as shall be determined by\nthe corporation.\n 2. Citizenship. A borrower must be (a) a citizen of the United States,\nor\n (b) a noncitizen lawfully admitted for permanent residence in the\nUnited States, or\n (c) an individual of a class of refugees paroled by the attorney\ngeneral of the United States under his or her parole authority\npertaining to the admission of noncitizens to the United States.\n 3. Loan limits. Education loans made under this program shall have\nannual and cumulative loan limits as approved from time to time by the\ncorporation, subject to the approval of the state of New York mortgage\nagency, or other public benefit corporation authorized to issue bonds\nunder the public authorities law for purposes of this program, with\nrespect to loans that are expected to be financed by such entity.\n 4. Interest rates. The interest rate of loans made under this program\nshall be established in a manner that shall be approved at least\nannually by the corporation, subject to the approval of the state of New\nYork mortgage agency, or other subject to public benefit corporation\nauthorized to issue bonds under the public authorities law for purposes\nof this program, with respect to loans that are expected to be financed\nby such entity.\n 5. Default fee. A percentage of the education loan shall be paid as a\ndefault fee, by or on behalf of the borrower or
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