(5 ILCS 385/0.01) (from Ch. 127, par. 3550) Sec. 0.01. Short title. This Act may be cited as the Educational Loan Default Act. (Source: P.A. 86-1324.)

(5 ILCS 385/1) (from Ch. 127, par. 3551) Sec. 1. Definitions. As used in this Act, unless the context otherwise requires: (a) "Educational loan" means any loan guaranteed by the State Scholarship Commission under the Higher Education Student Assistance Law, any education loan made by an institution of higher education from the proceeds of a loan to the institution by the Illinois Independent Higher Education Loan Authority under the Illinois Independent Higher Education Loan Authority Act, or any other loan from public funds made for the purpose of financing an individual's attendance at an institution of higher education. (b) "State agency" means any officer, board, commission or agency created by the Constitution, whether in the executive, legislative or judicial branch, but other than the circuit court; any officer, department, board, commission, agency, institution, authority, university, body politic or corporate of the State; any administrative unit or corporate outgrowth of the State government which is created by or pursuant to statute, other than units of local government and their officers, school districts and boards of election commissioners; or any administrative unit or corporate outgrowth of the above or as may be created by executive order of the Governor. (Source: P.A. 85-827.)

(5 ILCS 385/2) (from Ch. 127, par. 3552) Sec. 2. (a) Any employee of a State agency who is in default on the repayment of any educational loan for a period of 6 months or more and in an amount of $600 or more shall, as a condition of employment, make a satisfactory loan repayment arrangement with the maker or guarantor of the loan. (b) As of the effective date of this Act, any employment application forms used by any State agency shall include a statement to be signed by the applicant concerning whether the applicant is in default as provided in this Section. (c) Any employee who is in default on an educational loan shall make a satisfactory loan repayment arrangement with the maker or guarantor of the loan prior to the completion of the sixth month of employment or within 6 months from the effective date of this Act, whichever is later. The State agency shall confirm the establishment of a satisfactory repayment arrangement by obtaining a written certification from the maker or guarantor of the loan. The State agency shall inform the employee of the opportunity to establish a repayment plan through payroll deductions in accordance with the State Salary and Annuity Withholding Act. (d) Should an employee fail to establish a satisfactory repayment arrangement prior to the completion of the sixth month of employment, the State agency shall terminate the individual's employment. (e) The maker or guarantor of the loan shall determine what constitutes a satisfactory repayment arrangement; however, no maker or guarantor shall require an employee to pay more than 20% of his or her gross monthly income unless federal law requires a larger payment on the educational loan. (Source: P.A. 85-827.)

(5 ILCS 385/3) (from Ch. 127, par. 3553) Sec. 3. No State agency shall contract with an individual for goods or services if that individual is in default, as defined in Section 2 of this Act, on an educational loan. Any contract used by any State agency shall include a statement certifying that the individual is not in default on an educational loan as provided in this Section. (Source: P.A. 85-827.)