If enacted, this legislation would effectively remove the financial burden of repaying student loans from parents if their child becomes disabled. The impact of this change would potentially be profound, allowing affected families to avoid crippling debt and seek additional support for necessary care and rehabilitation without the added stress of repayments on educational loans.
Summary
House Bill 8407, also known as 'Domenic and Ed's Law', aims to provide significant financial relief to parents who have taken out loans for their children's education in the event that the student becomes permanently disabled. The bill seeks to amend Section 437(d) of the Higher Education Act of 1965, allowing for the discharge of parent borrower liability when a student cannot engage in any substantial gainful activity due to a medically determinable physical or mental impairment lasting at least 60 months.
Contention
Potential points of contention surrounding HB8407 may arise regarding its fiscal implications for federal loan programs, as the discharge of loans could increase costs to taxpayers. Advocates for the bill might argue for the necessity of providing such protections to help families in difficult circumstances, while opponents could raise concerns about the impact on the education loan system and the potential for moral hazard.