Student loan fund to release guarantors from liability under new law

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The new law would allow the fund to help borrowers being sued during trials or after court rulings or when they are under lawful enforcement of court orders, Krisada added.

The fund would be empowered to restructure bad debts so that former students could return money borrowed from the fund, he said.

“For the past three years, the fund hasn’t sued more former students because we’d like to help borrowers in times of crisis,” Krisada said.

“We only sued in cases where the statute of limitations was about to expire. Either way, sued borrowers can try to reach a settlement with us.

Krisada urged borrowers to honor their debt repayment pledge to the fund so that it has money to provide loans to future university students.

After the new law is enacted, guarantors who have been sued by the fund can also negotiate with the fund to find better solutions, he added.

Currently, the Student Loan Fund has about 600,000 debtors and about 40% have become non-performing loans. Over the past three years, the fund has reduced the fine for late payment from 7.5% per year to 0.5% per year. Apart from reducing the fine, the fund also reduced fines for borrowers who returned to negotiate debt restructuring, Krisada added.

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