Friday, August 25, 2017

What The Navient Lawsuit Means For Your Student Loans

















On Wednesday, the Consumer Financial Protection Bureau (CFPB) filed a lawsuit against Navient, the largest student loan servicer in the country.

If you have a student loan, there is a good chance that it may be serviced by Navient. Navient, which spun off from Sallie Mae, has more than 12 million customers and services more than $300 billion of government and private student loans.

Here is what you need to know and the action that you can take:
Navient Lawsuit: What Are The Allegations?

In its lawsuit and press release, the CFPB alleges that, among other allegations, Navient "systematically and illegally [failed] borrowers at every stage of repayment," including:


*created obstacles to repayment by providing bad information;

*processed payments incorrectly;

*failed to act when borrowers complained;

*illegally cheated many struggling borrowers out of their rights to lower payments, which caused them to overpay for their student loans;

*deceived private student loan borrowers about requirements to release their co-signer from the loan;

*and harmed the credit of disabled borrowers, including severely injured veterans



The CFPB also alleges that Navient improperly directed borrowers into forbearance when these borrowers otherwise might have qualified for income-driven repayment plans, and did not adequately keep borrowers in income-driven plans informed of deadlines to maintain their eligibility under such plans.

"For years, Navient failed consumers who counted on the company to help give them a fair chance to pay back their student loans," said CFPB Director Richard Cordray in a statement. "At every stage of repayment, Navient chose to shortcut and deceive consumers to save on operating costs. Too many borrowers paid more for their loans because Navient illegally cheated them and today's action seeks to hold them accountable."

In a statement, Navient denied all allegations and said the lawsuit was politically motivated.


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