One of the nation’s largest student loan companies has officially settled a yearslong battle following allegations of student loan misconduct.
“It was a hard-fought battle to really make sure that this wasn’t just about a fine, but that this would actually end Navient’s years of abuses,” said CFPB Director Rohit Chopra.
Per a court filing, the CFPB identified student borrowers who received information about income-based plans via phone calls and emails. However, the bureau reports that many were deemed ineligible or chose forbearance because they could not afford their payments.
“This agreement puts these decade-old issues behind us,” said Navient spokesperson Paul Hartwick. “While we do not agree with the CFPB’s allegations, this resolution … is an important positive milestone in our transformation of the company.”
According to the settlement, Navient will never return to federal student loan servicing and has agreed never to “purchase debt originated through the defunct Federal Family Education Loan program.”
Moreover, the student loan company must prove that borrowers are made aware of their right to enroll in affordable repayment plans should there be instances of them still servicing student loans from the previous bank-based federal program.
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Source: Black Enterprise
