Know Your Rights / Consumer Protection

California Student Borrower Bill of Rights

Known as the “Student Borrower Bill of Rights,” Assembly Bill 376 expands the rights of borrowers in several ways. Student loan servicers must now provide clear and accurate information, minimize fees, keep records, and not engage in deceptive or abusive practices.

In 2019, California introduced the Student Borrower Bill of Rights backed by a coalition of 70 civil rights, higher education, and consumer advocacy organizations. Signed into law by Governor Gavin Newsom in 2020, the Student Borrower Bill of Rights expanded protections for Californians with Student loans in the military, public service workers, older borrowers, and borrowers with disabilities.

This law now requires servicers to work in the best interest of borrowers, prohibiting servicers from giving student loan borrowers inaccurate information or taking advantage of misunderstandings.

Your rights as a Californian with federal and private student loans:

• Loan servicers must provide borrowers with accurate information about loan terms, repayment options, and benefits.
• Loan servicers must process and post loan payments in a timely manner.
• Loan servicers must allocate any overpayments in a manner that is in the best financial interest of a student loan borrower.
• Loan servicers must minimize late fees – to not exceed 6% of any past due amount.
• Loan servicers must process paperwork in a timely manner.
• Loan servicers must respond to a borrower’s Qualified Written Request (QWR) within 30 business days.
• If a student loan is transferred, the original loan servicer must notify the borrower of these changes at least 15 days before a payment is due.
• Special protections are established for military borrowers, borrowers working in public service, older borrowers, and borrowers with disabilities.
• If a loan servicer does not follow the terms above, a borrower can take legal action against them. This is called a “Private Right of Action.”

These one-page fliers summarize the rights that apply to all Californians with federal and/or private student loans mandated by Assembly Bill 376.

English Version |  Spanish Version

Student Loan Ombudsperson

The Student Loan Ombudsperson works with other divisions within the DFPI to evaluate the challenges facing Californians with Student Loans. The Ombudsperson also monitors the development of federal and state laws, rules, regulations, and policies relating to student loan borrowers in our state and partners with other agencies to reach student borrowers. Celina Damian filled the Student Loan Ombudsperson position in 2020 as a requirement of the California Student Borrower Bill of Rights.

To get answers to specialized questions or request additional help with your student loans, contact Celina Damian directly at Celina.Damian@dfpi.ca.gov.

Report

Annual Report of the Student Loan Ombudsman for 2022 (PDF)

File a Complaint

You can always reach out to us if you have issues with a student loan lender or service provider. The DFPI evaluates and reviews complaints and takes appropriate action when finding violations of the laws and regulations we administer.

The DFPI encourages consumers to submit complaints if they believe a DFPI licensee or registrant has violated state law or acted improperly, or they believe a company or person is conducting unlicensed or unregistered activity that falls within the DFPI’s jurisdiction.

To file a complaint, visit the DFPI’s File a Complaint Webpage or contact us at Ask.DFPI@dfpi.ca.gov or toll-free (866) 275-2677.