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CaliforniaAB 6812025-2026 Regular SessionHouseWALLET

California DREAM Loan Program: limits.

Sponsored By: Sade Elhawary (Democratic)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 1 costs, 2 mixed.

Loan forgiveness for DREAM borrowers

Schools must offer loan forgiveness options with standards like the Federal Perkins Loan Program. They were required to have these in place by January 1, 2024. If you meet those rules, some or all of your loan can be forgiven.

Tighter borrowing limits for DREAM students

Undergraduates can borrow up to $4,000 per academic year. Graduate students can borrow up to $20,500 per academic year. Lifetime caps are $20,000 as an undergraduate, $118,500 as a graduate, and $138,500 total. You also cannot borrow more than your school’s calculated financial need. Schools apply these caps when they approve your loan.

New DREAM repayment and interest rules

Standard repayment is 10 years, with payments starting after a six-month grace period. The DREAM loan interest rate matches the current federal undergraduate Direct Loan rate. Interest does not accrue while you are enrolled at least half-time or during the six-month grace period. Schools must let you pick an income-based repayment plan under federal Direct Loan standards. Schools use federal standards to decide deferment, discharge, and forbearance. Schools issue DREAM loans using a single promissory note approved by the State Treasurer.

Emergency relief for DREAM borrowers

During a presidentially declared national emergency, schools apply federal Direct Loan relief to DREAM loans. If the Governor or your school grants state emergency forbearance, it applies to DREAM loans. If you live or work in a natural disaster area, you get 90 days of administrative relief once the school is told by you, a family member, or another reliable source.

Schools prioritize instructional program loans

Schools decide how to split DREAM funds between instructional programs and graduate programs. They must give priority to instructional program loans. When money is tight, this can mean fewer loans for some graduate students.

Sponsors & Cosponsors

Sponsor

  • Sade Elhawary

    Democratic • House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 126 • No: 28

Senate vote • 9/4/2025

Item 220 — Senate SFLOOR

Yes: 30 • No: 9

legislature vote • 8/29/2025

Vote in CS61

Yes: 5 • No: 2

legislature vote • 6/23/2025

Vote in CS61

Yes: 7 • No: 0

legislature vote • 6/11/2025

Vote in CS44

Yes: 5 • No: 1

House vote • 5/5/2025

Item 86 — Assembly AFLOOR

Yes: 61 • No: 10

legislature vote • 4/9/2025

Vote in CX25

Yes: 10 • No: 4

legislature vote • 3/18/2025

Vote in CX09

Yes: 8 • No: 2

Actions Timeline

  1. Chaptered by Secretary of State - Chapter 702, Statutes of 2025.

    10/13/2025Senate

  2. Approved by the Governor.

    10/13/2025legislature

  3. Enrolled and presented to the Governor at 4 p.m.

    9/11/2025legislature

  4. In Assembly. Ordered to Engrossing and Enrolling.

    9/4/2025House

  5. Read third time. Passed. Ordered to the Assembly. (Ayes 30. Noes 9. Page 2516.).

    9/4/2025Senate

  6. Read second time. Ordered to third reading.

    8/29/2025Senate

  7. From committee: Do pass. (Ayes 5. Noes 2.) (August 29).

    8/29/2025Senate

  8. In committee: Referred to suspense file.

    6/23/2025Senate

  9. From committee: Do pass and re-refer to Com. on APPR. (Ayes 5. Noes 1.) (June 11). Re-referred to Com. on APPR.

    6/11/2025Senate

  10. Referred to Com. on ED.

    5/14/2025Senate

  11. In Senate. Read first time. To Com. on RLS. for assignment.

    5/6/2025Senate

  12. Read third time. Passed. Ordered to the Senate. (Ayes 61. Noes 10. Page 1419.)

    5/5/2025House

  13. Read second time. Ordered to third reading.

    4/10/2025House

  14. From committee: Do pass. (Ayes 10. Noes 4.) (April 9).

    4/9/2025House

  15. From committee: Do pass and re-refer to Com. on APPR. (Ayes 8. Noes 2.) (March 18). Re-referred to Com. on APPR.

    3/19/2025House

  16. Referred to Com. on HIGHER ED.

    3/3/2025House

  17. From printer. May be heard in committee March 17.

    2/15/2025House

  18. Read first time. To print.

    2/14/2025House

Bill Text

  • Chaptered

    10/13/2025

    HTML

  • Enrolled

    9/8/2025

    HTML

  • Introduced

    2/14/2025

    HTML

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