SECTION 200.5. Establishment of a Loan Loss Reserve Account

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(a) After entering an Agreement with the Office, a PFI making Qualified Loans shall establish a Loan Loss Reserve Account to receive the premium payments described in §200.9 of this chapter (relating to Contributions to Loan Loss Reserve) from the Borrower and the PFI, and the Office's matching contribution as described in §200.11 of this chapter (relating to State Contributions to Loan Loss Reserve Accounts).
(b) The Loan Loss Reserve Account shall be:
(1) used by the PFI only to cover Losses arising from a charge off of an Enrolled Loan or as provided by the Agreement or this subchapter; and
(2) established in a money market fund in a Financial Institution specified by the Office; the interest rate for the money market fund must be a competitive rate.

Source Note: The provisions of this §200.5 adopted to be effective June 25, 2023, 48 TexReg 3217

                    
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