Navient paying $1.85B over claims of predatory student loan practices

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Navient, one of the nation’s largest student loan services, reached a $1.85 billion settlement with a coalition of 39 state attorneys general to resolve allegations of predatory student loan servicing practices.

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Running the news: “Today’s settlement corrects Navient’s past behavior, provides much-needed relief to Pennsylvania borrowers, and puts in place safeguards to ensure that this company never falls victim to student loan borrowers again,” Attorney of Pennsylvania General Josh Shapiro said in a statement,

  • The deal, announced Thursday, requires Navient to cancel $1.7 billion in private student loan debt for about 66,000 borrowers and pay $95 million in restitution.
  • The Attorney General’s Coalition claimed that since 2009, Navient “drives struggling student loan borrowers into costly long-term forbearances, rather than counseling them about the benefits of more affordable income-driven repayment plans,” according to a statement. Is.”
  • The Coalition also alleged that Navient introduced private loans to for-profit schools, often with low graduation rates, “though it knew that a very high percentage of such borrowers would be unable to repay the loan.”

Second aspect: Navient said Statement That it denies “violating any law, including consumer-protection laws, or that harms the borrower.”

  • “The company’s decision to resolve these cases, which were based on unfounded claims, allows us to avoid additional burden, expense, time and distraction in court,” said Mark Helen, Navient’s chief legal officer.
  • “Naviant is relentlessly focused on helping student loan borrowers understand and choose the right payment options to meet their needs.”

go in: Navient will no longer service federal student loans


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