Posted on Jun 12, 2019

On June 7, 2019 Texas Governor Abbott signed SB 37which bans Texas agencies from denying, suspending, or revoking a borrower’s occupational license simply because they had defaulted on their student loans. “It protects your right to earn a living,” he said. The bill is effective immediately.

According to an investigation by the Texas Tribune, in 2017 alone, the state’s default suspension laws threatened the licenses of more than 4,200 professionals, including cosmetologists, dentists, and pharmacists. In the last few years, 530 nurses and almost 250 teachers couldn’t renew their licenses because of their student loan debt.

Since lenders and loan guarantors can already garnish wages, seize tax refunds, and use other methods to collect from borrowers in default, threatening to suspend occupational licenses was determined to be unnecessary and self-defeating, as the defaulted borrowers would not have the income to repay the loans if their occupational licenses were suspended.

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J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization