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If a Texas veteran has defaulted on an education loan through a loan program in another state, would he/she be eligible for an exemption?
A default on a non-federal education loan authorized by the legislature of another state and administered by that state is not a basis for denying the Hazlewood Act benefit. A veteran who has defaulted on any federal education loan is disqualified from receiving Hazlewood Act benefits. A portion of the law indicates that defaulted loans made or guaranteed by the State of Texas also disqualify a veteran from Hazlewood Act benefits. This portion of the law relates to defaults on education loans authorized by the Texas Legislature and administered by the State of Texas. Currently, the state loans to which this provision applies are: Hinson-Hazlewood Stafford Loans, Hinson-Hazlewood Health Education Loans (HELP), Hinson-Hazlewood College Access Loans (CAL), uninsured Texas Opportunity Plan Loans (TOP) and the Texas B-On-Time Student Loan administered by the Texas Higher Education Coordinating Board.
Will individuals in default on a federal or state student loan be eligible to use the Hazlewood Act benefits for non-credit courses?
If a veteran has a default, which would exclude him/her from Hazlewood Act benefits, that exclusion would apply no matter what types of classes are taken.
If a veteran receives Hazlewood Act benefits and it is later discovered that he/she defaulted on an applicable federal or state loan, does he/she have to reimburse the school for the classes taken with the exemption?
If the veteran signs a statement that he/she is not in default of any federal education loan or any education loan made or guaranteed by the State of Texas and is later found to be in default, the school can require repayment of tuition and appropriate fees.
If a student is in default on a PLUS loan, can he or she receive Hazlewood Act benefits?
PLUS loans are taken out by the parents of students. If the parents default on their child’s PLUS loan, the child is not in default. This default status does NOT have an impact on the student’s eligibility for Hazlewood Act benefits.
