The undersigned sixteen organizations, representing California borrowers, educators, and consumer advocates, submit this comment in response to the California Department of Financial Protection & Innovation’s (“DFPI” or “Department”) notice of proposed rulemaking to adopt new regulations and amend current regulations implementing the Student Loan Servicing Act (SLSA), Fin. Code, § 28100, et seq., and to provide additional detail and clarity to the Student Loans: Borrower Rights law (SLBR), Civ. Code, § 1788.100 et seq.1
We applaud DFPI’s proposal, which will provide much-needed clarity about the scope of the SLSA’s and SLBR’s applicability and consumer protections. Specifically, the DFPI’s proposed rule clarifies licensees’ obligation to comply with the SLBR and that servicers of income share agreements, installment contracts, and other types of private education loans must obtain a student loan servicing license from the DFPI. This will benefit student borrowers, schools, and honest lenders and servicers, to whom this proposal gives clear expectations about regulatory requirements and consumer protections for student loan servicing in California.
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