Private Student Loan Collection Reform Bill Signed in California

The bill’s approval was part of several higher education reform initiatives and will take effect July 1, 2022.

10/11/2021 9:00 AM

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Private Student Loan Collection Reform Bill Signed in California

Legislation placing new documentation requirements on private student loan lenders before initiating any collection activity is now final in California.

Gov. Gavin Newsom signed A.B. 424, the Private Student Loan Collection Reform Act, sponsored by State Assemblymember Mark Stone, D-Monterey Bay, last week. The governor also signed a package of bills to improve college affordability and increase access to higher education, according to a news release. Overall, California’s higher education legislation includes $47.1 billion in funding.

A.B. 424 places new documentation requirements on private student loan lenders before initiating any collection activity. It also requires student loan settlements by private student loan lenders and debt collectors to be done in open court.

The Private Student Loan Collections Reform Act will become operative July 1, 2022.

The bill summary states, “The act would prohibit a private education lender or a private education loan collector, as defined, from making any written statement to a debtor in an attempt to collect a private education loan unless the private education lender or private education loan collector possesses certain information regarding the loan and provides this information to the debtor, as specified. The act would require all settlement agreements between a private education lender or private education loan collector and a debtor to be documented in open court or otherwise reduced to writing, as specified. The act would also require a private education lender or private education loan collector that accepts a payment as payment in full or as a full and final compromise of a private education loan, within 30 calendar days, to provide specified information to the debtor regarding the loan.”

Gov. Newsom also recently signed legislation on consumer notification requirements for debt collectors and debt settlements, ACA International previously reported.

For more information on how the ACA licensing staff can assist with your licensing application completion needs, please contact us at licensing@acainternational.org or call (952) 926-6547.

To receive notifications about ACA content—including member alerts, upcoming events and new products—text ALERTS to 96997.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

Private Student Loan Collection Reform Bill Signed in California

Legislation placing new documentation requirements on private student loan lenders before initiating any collection activity is now final in California.

Gov. Gavin Newsom signed A.B. 424, the Private Student Loan Collection Reform Act, sponsored by State Assemblymember Mark Stone, D-Monterey Bay, last week. The governor also signed a package of bills to improve college affordability and increase access to higher education, according to a news release. Overall, California’s higher education legislation includes $47.1 billion in funding.

A.B. 424 places new documentation requirements on private student loan lenders before initiating any collection activity. It also requires student loan settlements by private student loan lenders and debt collectors to be done in open court.

The Private Student Loan Collections Reform Act will become operative July 1, 2022.

The bill summary states, “The act would prohibit a private education lender or a private education loan collector, as defined, from making any written statement to a debtor in an attempt to collect a private education loan unless the private education lender or private education loan collector possesses certain information regarding the loan and provides this information to the debtor, as specified. The act would require all settlement agreements between a private education lender or private education loan collector and a debtor to be documented in open court or otherwise reduced to writing, as specified. The act would also require a private education lender or private education loan collector that accepts a payment as payment in full or as a full and final compromise of a private education loan, within 30 calendar days, to provide specified information to the debtor regarding the loan.”

Gov. Newsom also recently signed legislation on consumer notification requirements for debt collectors and debt settlements, ACA International previously reported.

For more information on how the ACA licensing staff can assist with your licensing application completion needs, please contact us at licensing@acainternational.org or call (952) 926-6547.

To receive notifications about ACA content—including member alerts, upcoming events and new products—text ALERTS to 96997.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

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