student loan rates set by repayment odds

The text as introduced · 463 words

89R2052 KJE-D

By: Guillen
H.B. No. 319

A BILL TO BE ENTITLED

AN ACT

relating to the interest rate for student loans issued by the Texas

Higher Education Coordinating Board.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 52.321, Education Code, is amended to

read as follows:

Sec. 52.321. STANDARDS CONCERNING ABILITY TO REPAY CERTAIN

LOANS. In establishing requirements to be met by applicants for

student loans authorized by the board under this chapter, the board

may not establish standards relating to demonstration of ability to

repay a federally insured student loan that are stricter for a

certain class of applicants than for other applicants, except :

(1) in cases where the applicant attends a school with

a loan default rate of 15 percent or more ; or

(2) as provided by Section 52.36 .

SECTION 2. Section 52.36, Education Code, is amended to

read as follows:

Sec. 52.36. LOAN INTEREST AND FEES. (a) The board shall

[ from time to time ] fix the interest to be charged for a [ any ]

student loan at a rate that ensures that the average interest rate

fixed for student loans under this chapter is sufficient to pay the

interest on outstanding bonds, any expenses incident to their

issuance, sale, and retirement, and all or a portion of the board's

expenses related to the operation of the student loan program.

(b) In fixing the interest rate for a student loan, the

board shall ensure that the rate corresponds to the risk that the

applicant will timely repay the loan, determined according to the

following factors and using the most recent data available:

(1) whether the applicant's proposed degree or

certificate program leads to a high-demand occupation in the region

of the participating higher educational institution at which the

applicant is enrolled;

(2) the projected salary or wages for the occupation

identified under Subdivision (1); and

(3) the percentage of the participating higher

educational institution's students in the applicant's proposed

degree or certificate program who obtain employment in that field

after graduation.

(c) Interest shall be postponed by the board as long as a

student is enrolled at a participating institution and may be

postponed at the board's discretion as long as a student is enrolled

at any other higher educational institution, provided that the

total interest paid is to be equal to that fixed at the time the note

evidencing the loan is executed.

(d) [ (b) ] The board may charge and collect loan origination

fees from borrowers for use in offsetting in whole or in part the

operating expenses for the loans.

SECTION 3. This Act applies beginning with student loans

issued for the 2026 spring semester.

SECTION 4. This Act takes effect September 1, 2025.