Student Loan Empowerment Project
The Student Loan Empowerment (SLE) Project provides $7.25 million in targeted grants that connect student loan borrowers to a network of community-based organizations and legal aid groups that provide free education, case management, and assistance with student loan issues.
The SLE Project was authorized via Governor Gavin Newsom’s 2022-2023 budget, which provided $10 million in one-time funding from the General Fund for Student Loan Borrower Assistance (SB 154). In addition to the $7.25 million grant program, the budget also included $2.75 million for a statewide marketing and communication campaign focused on student loan borrower education and outreach to further the state’s commitment to providing Californians who hold student loans with vital information about their rights and options.
The Student Loan Landscape in California
In California, there are nearly four million borrowers who owe $156 billion in federal and private student loans. These borrowers are faced with navigating a complex and confusing repayment system and a student loan market plagued with predatory practices. Additionally, borrowers with private loans do not have repayment protections under federal law to help them manage their loans. Poor servicing practices can add to the overall cost of loans and cause borrowers to slide into default.
Research shows that the student loan debt burden falls disproportionately on women, low-income, first-generation, and Black borrowers. In California, the default rate, or the rate of borrowers who are currently at least 90 days delinquent, is 11 percent. Defaulting on student loans can have severe consequences, including wage, tax, or social security garnishment, notification to credit bureaus and possible legal action. Defaulted borrowers tend to have a lower student loan balance with a median loan balance of $15,307 and are higher among those who attended private-for-profit colleges, those who don’t complete a degree or certificate, and Black and Latinx borrowers. The ripple effects of student debt are substantial, and student loan debt negatively impacts a borrower’s financial future, including their ability to buy a home, choose a career, and save for retirement according to the Annual Report of the Student Loan Ombudsman 2024.
With continued changes at the federal level, borrowers are faced with many uncertainties and challenges.
The Student Loan Empowerment Network
In 2024, the Student Loan Empowerment Project awarded 15 grants to nonprofit organizations to establish the Student Loan Empowerment Network. Since June 2024, the Network has provided free financial education, counseling, and legal assistance to help Californians navigate their student loans for a two-year period.
Student Loan Empowerment Project Grantees
| Grantee | Two-Year Grant Amount |
|---|---|
| Stream 1 Grants – Network Coordination, Training and Quality Assurance | |
| BALANCE | $1,499,052 |
| National Consumer Law Center | $327,285 |
| S1 Total | $1,826,337 |
| Stream 2 Grants – Direct Support for Borrowers | |
| BALANCE | $500,000 |
| Bay Area Legal Aid | $500,000 |
| East Bay Community Law Center | $280,448 |
| Housing and Economic Rights Advocates | $453,663 |
| International Rescue Committee, Inc. in Sacramento | $353,552 |
| Koreatown Youth and Community Center Inc | $448,000 |
| Legal Aid Foundation of Los Angeles | $370,000 |
| Legal Aid Society of San Bernardino | $380,000 |
| Legal Aid Society of San Diego | $400,000 |
| Lutheran Social Services of Southern California | $478,000 |
| MyPath | $510,000 |
| Public Counsel | $400,000 |
| The Cambodian Family | $350,000 |
| S2 Total | $5,423,663 |
| Total Grants Awarded | $7,250,000 |
At the end of 2024, the SLE Network showed promising results. In its first six months of services, the Network provided individualized assistance to more than 1000 Californian borrowers with issues such as managing repayment, and applying for Income Driven Payment plans, Public Service Loan Forgiveness, and Total and Permanent Disability Discharge. Additional program results will be available in mid-2026.
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Get 1:1 help
The Student Loan Empowerment Network
This DFPI-powered network of 14 nonprofit organizations provides free and individualized education, case management, and assistance with student loan issues for Californians.
Need One-on-One help with your student loan payment options? Check out the Student Loan Empowerment Network to find a student loan counselor in your area.
Resources and Announcements
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- DFPI Launches Network to Help Californians Navigate Their Student Loans https://dfpi.ca.gov/press_release/dfpi-launches-network-to-help-californians-navigate-their-student-loans/
- Visit our Student Loan & Borrower Resources for information and resources related to student loans, and learn about the California Student Loan Borrower Bill of Rights.