Texas Senate Bill SB1380

Texas 2017 - 85th Regular

Caption

Relating to alternative education loans and to the use of higher education private activity bonds by qualified alternative education loan lenders.

Impact

The implications of SB1380 extend to both educational financing and the broader economic landscape. The bill allows for increased flexibility in funding options available to students, potentially improving access to education for those who might not qualify for traditional loans. This could promote a more inclusive educational environment, particularly benefiting non-traditional students and those attending accredited institutions within Texas. Additionally, the use of private activity bonds presents opportunities for lower interest rates, making education financing more manageable for many.</p>

Summary

SB1380 is a legislative measure aimed at enhancing the framework for alternative education loans and the utilization of private activity bonds for higher education. The bill modifies several sections within the Education Code and the Government Code to broaden the scope of how alternative education loans are conceptualized and managed. It delineates the roles and capabilities of qualified alternative education loan lenders, specifically emphasizing the ability of nonprofit corporations to engage in the making, purchasing, or refinancing of loans for students and former students. By expanding the definition of alternative education loans, the bill enables a wider range of financial products that can support students' educational pursuits.

Contention

Notably, the bill may face scrutiny regarding its impact on existing student loan frameworks and potential risks associated with alternative lending. Critics might raise concerns about the adequacy of consumer protections for students borrowing through alternative loans compared to federal student loan options. Furthermore, the engagement of nonprofit organizations as lenders could lead to debates on accountability and the ethical implications of alternative financing methods. Stakeholders will need to consider how these changes interact with the current landscape of higher education financing and consumer rights.