Texas House Bill HB3198

Texas 2013 - 83rd Regular

Caption

Relating to suits for default on a student loan administered by the Texas Higher Education Coordinating Board.

Impact

The implications of HB 3198 are significant as it centralizes the handling of student loan defaults to the attorney general's office, setting a clear pathway for the initiation of legal suits against borrowers. This could lead to an increase in the enforcement of loan repayments and ultimately may influence borrower behavior, encouraging timely repayments to avoid legal consequences. However, the emphasis on legal action could also raise concerns about the burden on individuals in default and the potential for increased financial strain during litigation.

Summary

House Bill 3198 focuses on governing the legal actions that may arise due to defaults on student loans administered by the Texas Higher Education Coordinating Board. Specifically, the bill amends Section 52.39 of the Education Code, streamlining the procedures regarding when and how the attorney general can initiate suits against individuals who have defaulted on their student loans. The bill stipulates that if an individual has failed to make six monthly payments, the full amount of the remaining principal and interest will become due on the entire loan, prompting the attorney general to report this and potentially file a lawsuit.

Contention

Points of contention surrounding HB 3198 could stem from its impact on borrowers who may already be struggling financially. Critics may argue that the bill could lead to excessive legal actions against individuals who find themselves in default without providing adequate support or alternatives. Furthermore, while the bill is designed to streamline processes, there may be concerns about whether it truly addresses the underlying issue of student loan debt and its management, including a discussion on the adequacy of support mechanisms for borrowers in distress.