CANCELLED! $1.7 Billion in Student Loan Debt Cancelled in Settlement with Navient
In a settlement announced today, student loan servicer Navient has agreed to cancel $1.7 billion in student loan debt owed by 66,000 borrowers, NPR reports.
“Navient repeatedly and deliberately put profits ahead of its borrowers,” said Pennsylvania State Attorney General Josh Shapiro, a leading voice behind the legal fight.
Advocates for student loan borrowers were quick to applaud the decision.
The Student Borrower Protection Center said of the agreement:
“At long last, the student loan borrowers who had been forced to shoulder the burden of dangerous and predatory private student loans made by Sallie Mae and owned by Navient will finally be debt free. Today’s action is a clear victory for many of the millions of borrowers whose pain Navient and Sallie Mae shamelessly turned into profit. Navient cheated borrowers at every stage of repayment, taking advantage of low-income borrowers, disabled veterans, seniors, and more, all in service to its bottom line. Today, these 39 states won a hard-fought battle to remedy this long history of abuse.
Borrowers may not be able to enjoy Navient CEO Jack Remondi’s $8 million salary, his three homes, or his use of the company’s private jet. But they can rest a little bit easier knowing that a measure of justice has been served.”
The National Consumer Law Center (NCLC) and Center for Responsible Lending issued a statement applauding the agreement and calling for further action from the U.S. Department of Education:
“Navient’s history of steering borrowers into high-cost, long-term forbearances instead of placing them in affordable income-driven repayment (IDR) plans harmed millions of borrowers nationwide — many of whom were borrowers of color and low-income students.
“This settlement requires Navient to change its practices going forward, but what it doesn’t do is credit borrowers with the years toward student loan cancellation through IDR that they missed out on as a result of poor loan servicing.
“The Department of Education can and should do exactly that for all borrowers: give them back the time they should have earned toward IDR cancellation and restore the promise of IDR.”