Student Debt AB 376 passed in the Assembly on 8/30/2020 establishes the Student Borrower Bill of Rights, ensuring that individuals with student loan debt are given reliable information, quality customer service, and meaningful access to repayment and forgiveness programs. This groundbreaking legislation will make California the first in the nation to offer student loan borrowers the same comprehensive protections that consumers with mortgages and credit cards take for granted. After a student loan is taken out, loan servicing companies are the ones that communicate with borrowers about payments, account information, refinancing options, and other issues surrounding their loans. Despite a mountain of evidence that demonstrates rampant predatory actors, it is very clear that the federal government has deliberately stepped back from its duties to protect student borrowers and, in order to protect its consumers California must take action. With 3,780,000 student loan borrowers across California owing $134.3 billion, it is imperative that California take a strong stance to protect borrowers against bad actors. AB 376 will ensure that California borrowers are protected and can take action if servicers violate these basic protections.
Where to go next: ADD AN AMENDMENT. Opposition raised several concerns with the bill. Many opponents disliked the consumer enforcement mechanism and want it removed from the bill or at least changed to mirror existing class action requirements under California law. Opponents believe that certain provisions of the bill are preempted under the National Bank Act or Higher Education Act. I will work with the BILL author to improve the BILL.