SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Preparing and Reinvesting in Early 
Education Act of 2012'' or ``PRE ED Act of 2012''.

SEC. 2. EXPANDING FFEL LOAN FORGIVENESS PROGRAM TO EARLY CHILDHOOD 
              EDUCATORS.

    Section 428J of the Higher Education Act of 1965 (20 U.S.C. 1078-
10) is amended--
            (1) in the section heading, by inserting ``early childhood 
        educators and elementary and secondary school'' before 
        ``teachers'';
            (2) by striking subsection (b) and inserting the following:
    ``(b) Program Authorized.--The Secretary shall carry out a program, 
through the holder of the loan, of assuming the obligation to repay a 
qualified loan amount for a loan made under section 428 or 428H, in 
accordance with subsection (c), for any borrower who--
            ``(1)(A) is a new borrower on or after October 1, 1998, and 
        has been employed as a full-time teacher for 5 consecutive 
        complete school years--
                    ``(i) in a school or location that qualifies under 
                section 465(a)(2)(A) for loan cancellation for Perkins 
                loan recipients who teach in such schools or locations; 
                and
                    ``(ii) if employed as an elementary school or 
                secondary school teacher, is highly qualified as 
                defined in section 9101 of the Elementary Secondary 
                Education Act of 1965, or meets the requirements of 
                subsection (g)(3); or
            ``(B)(i) has been employed as a full-time early childhood 
        educator at an early childhood program for 5 consecutive 
        complete school years or a comparable period, as determined by 
        the Secretary; and
            ``(ii) obtained an associate degree or baccalaureate degree 
        in early childhood education from an institution of higher 
        education prior to the beginning of the period described in 
        clause (i); and
            ``(2) is not in default on a loan for which the borrower 
        seeks forgiveness.'';
            (3) by striking paragraph (1) of subsection (c) and 
        inserting the following:
            ``(1) In general.--
                    ``(A) Aggregate amounts.--Of the loan obligation on 
                a loan made under section 428 or 428H that is 
                outstanding after the completion of the fifth complete 
                school year of teaching described in subsection (b)(1) 
                or comparable period (in accordance with subsection 
                (b)(1)(B)(i)), the Secretary shall repay not more 
                than--
                            ``(i) $5,000 in the aggregate for a 
                        borrower described in subsection (b)(1)(A), 
                        except as provided in paragraph (3); and
                            ``(ii) $25,000 in the aggregate for a 
                        borrower described in subsection (b)(1)(B).
                    ``(B) Interaction with direct loan program.--No 
                borrower may receive a reduction of loan obligations 
                under both this section and section 460.''; and
            (4) in subsection (g)--
                    (A) in paragraph (1)(A), by striking ``(b)(1)(A)'' 
                and inserting ``(b)(1)(A)(i)''; and
                    (B) in paragraph (3), by striking ``(b)(1)(B)'' and 
                inserting ``(b)(1)(A)(ii)''.

SEC. 3. EXPANDING FEDERAL DIRECT LOAN CANCELLATION PROGRAM TO EARLY 
              CHILDHOOD EDUCATORS.

    Section 460 of the Higher Education Act of 1965 (20 U.S.C. 1087j) 
is amended--
            (1) in the section heading, by inserting ``early childhood 
        educators and elementary and secondary school'' before 
        ``teachers'';
            (2) by striking subsection (b) and inserting the following:
    ``(b) Program Authorized.--The Secretary shall carry out a program 
of canceling the obligation to repay a qualified loan amount in 
accordance with subsection (c) for Federal Direct Stafford Loans and 
Federal Direct Unsubsidized Stafford Loans made under this part for any 
borrower who--
            ``(1)(A) is a new borrower on or after October 1, 1998 and 
        has been employed as a full-time teacher for 5 consecutive 
        complete school years--
                    ``(i) in a school or location that qualifies under 
                section 465(a)(2)(A) for loan cancellation for Perkins 
                loan recipients who teach in such schools or locations; 
                and
                    ``(ii) if employed as an elementary school or 
                secondary school teacher, is highly qualified as 
                defined in section 9101 of the Elementary Secondary 
                Education Act of 1965, or meets the requirements of 
                subsection (g)(3); or
            ``(B)(i) has been employed as a full-time early childhood 
        educator at an early childhood program for 5 consecutive 
        complete school years or a comparable period, as determined by 
        the Secretary; and
            ``(ii) obtained an associate degree or baccalaureate degree 
        in early childhood education from an institution of higher 
        education prior to the beginning of the period described in 
        clause (i); and
            ``(2) is not in default on a loan for which the borrower 
        seeks forgiveness.'';
            (3) by striking paragraph (1) of subsection (c) and 
        inserting the following:
            ``(1) In general.--
                    ``(A) Aggregate amounts.--Of the loan obligation on 
                a Federal Direct Stafford Loan or a Federal Direct 
                Unsubsidized Stafford Loan that is outstanding after 
                the completion of the fifth complete school year of 
                teaching described in subsection (b)(1) or comparable 
                period (in accordance with subsection (b)(1)(B)(i)), 
                the Secretary shall cancel not more than--
                            ``(i) $5,000 in the aggregate for a 
                        borrower described in subsection (b)(1)(A), 
                        except as provided in paragraph (3); and
                            ``(ii) $25,000 in the aggregate for a 
                        borrower described in subsection (b)(1)(B).
                    ``(B) Interaction with ffel program.--No borrower 
                may receive a reduction of loan obligations under both 
                this section and section 428J.''; and
            (4) in subsection (g)--
                    (A) in paragraph (1)(A), by striking ``(b)(1)(A)'' 
                and inserting ``(b)(1)(A)(i)''; and
                    (B) in paragraph (3), by striking ``(b)(1)(B)'' and 
                inserting ``(b)(1)(A)(ii)''.

SEC. 4. AMENDMENT TO LOAN FORGIVENESS FOR SERVICE IN AREAS OF NATIONAL 
              NEED PROGRAM.

    Section 428K(g)(3)(C) of the Higher Education Act of 1965 (20 
U.S.C. 1078-11(g)(3)(C)) is amended by inserting ``an associate degree 
in early childhood education or'' before ``a baccalaureate''.
Preparing and Reinvesting in Early Education Act of 2012 or PRE ED Act of 2012 - Amends the Higher Education Act of 1965 to include early childhood educators in the Federal Family Education Loan (FFEL) and Direct Loan (DL) forgiveness programs for teachers.

Makes early childhood educators eligible for FFEL or DL forgiveness if they are not in default on the loan being forgiven and have: (1) been employed as a full-time early childhood educator for five consecutive complete school years or a comparable period, as determined by the Secretary of Education; and (2) obtained an associate or baccalaureate degree in early childhood education prior to that period of service.

Caps at $25,000 the amount of an early childhood educator's FFEL or DL that may be forgiven.

Includes early childhood educators with associate degrees in early childhood development, early child education, or a related field in the program providing FFEL forgiveness for service in areas of national need. (Currently, early childhood educators are required to have completed a baccalaureate or advanced degree in such a field to qualify for participation in that program.)
A bill to amend the Higher Education Act of 1965 to provide for loan forgiveness for early childhood educators, and for other purposes.