To amend the Higher Education Act of 1965 to achieve savings in the operation of the student loan programs under part B of title IV of that Act, and for other purposes.

Amends the Higher Education Act of 1965 to revise or add to the guaranteed student loan program (also known as the Stafford Loan or the Federal Family Education Loan Program) with respect to: (1) in-school and grace period interest rate limits; (2) loan transfer fees; (3) decrease of guaranty agency reinsurance percentage; (4) required risk sharing by the Student Loan Marketing Association; (5) shares of post-default collections; (6) decrease of administrative cost allowances; (7) reinsurance fees; (8) parent loan (PLUS) amount limits and multiple disbursement requirements; (8) reduction and limitation of consolidation loan interest rates; (9) limitation of interest subsidy during deferment; (10) insurance fees from lenders; (11) longer periods for default determinations; (12) special allowances on tax exempt funds and purchase premiums; (13) origination fees from lenders; (14) the lender-of-last-resort requirement; (15) Student Loan Marketing Association alternative status study; and (16) repayment options (including income sensitive) availability and information.