FOR IMMEDIATE RELEASE:
June 20th, 2018
CONTACT: Natalia Abrams
Statement: California Lawmakers Must Oppose Amendments to Bill that Would Weaken Student Loan Consumer Protections
Student Debt Crisis strongly opposes the amendment to California Assembly Bill 38 that weakens oversight of student loan guaranty agencies; the companies tasked with contacting borrowers who fall behind on their student loans. This change arbitrarily excludes guaranty agencies from regulations that protect borrowers from loan servicer abuses.
“Borrowers in California deserve robust consumer protections whether they are working with a big student loan servicer, like Navient, or a lesser-known guaranty agency. In fact, the most vulnerable and at-risk student loan borrowers are in contact with guaranty agencies. That is why stronger oversight is necessary, not less.”
– Natalia Abrams, Executive Director Student Debt Crisis
Up to 300,000 student loan borrowers in California could be contacted by a guarantee agency. These borrowers owe over $20 billion in student loans. This massive scale demands extraordinary accountability. A strong regulatory framework is necessary to ensure borrower’s interests are always placed first.
A Washington, D.C. lobbying group has been working to shield student loan companies from proper scrutiny. This same lobbying group supported Betsy DeVos’ efforts to try and stop states from regulating bad actors in the student loan industry. Student Debt Crisis vehemently opposed that policy change as well.
Some lawmakers in California are about to cave to industry pressure at the worst possible time for borrowers. The state’s student loan debt total continues to climb past record highs and borrowers need vocal champions in the state legislature. We strongly encourage state legislators to OPPOSE the amendment to AB-38.
Student Debt Crisis is a nationwide advocacy group with over 1,000,000 supporters calling for fair student loan and higher education policies.