Skip to main content
U.S.

Navient banned from student loans, ordered to pay $120 million in settlement

Share

This report was created with support from enhanced software.


In a settlement, Navient is permanently banned from servicing federal student loans and must pay $120 million in penalties and borrower relief. The Consumer Financial Protection Bureau (CFPB) accused Navient of steering struggling borrowers into costly forbearance options instead of income-driven repayment plans, mishandling payment processing, and harming the credit of disabled borrowers.

Media Landscape

See who else is reporting on this story and which side of the political spectrum they lean. To read other sources, click on the plus signs below. Learn more about this data
Left 43% Center 48% Right 10%
Bias Distribution Powered by Ground News

Navient allegedly enrolled 1.5 million borrowers in multiple consecutive forbearances, resulting in $4 billion in additional interest charges.

QR code for SAN app download

Download the SAN app today to stay up-to-date with Unbiased. Straight Facts™.

Point phone camera here

In a statement, Navient says it does not agree with the CFPB’s allegations. However, the company states, “This agreement puts these decade-old issues behind us.”

Under the settlement, Navient is banned from serving federal student loans. Navient will also pay a $20 million penalty and provide $100 million in relief to affected borrowers.

The CFPB said it will mail checks to eligible borrowers, and affected consumers will not need to do anything to obtain redress.

Tags: , , , , , ,

Lauren Taylor

IN A SETTLEMENT — NAVIENT IS PERMANENTLY BANNED FROM SERVICING FEDERAL STUDENT LOANS AND MUST PAY $120 MILLION IN PENALTIES AND BORROWER RELIEF.

 

THE CONSUMER FINANCIAL PROTECTION BUREAU ACCUSED NAVIENT OF STEERING STRUGGLING BORROWERS INTO COSTLY FORBEARANCE OPTIONS INSTEAD OF INCOME-DRIVEN REPAYMENT PLANS, MISHANDLING PAYMENT PROCESSING AND HARMING THE CREDIT OF DISABLED BORROWERS.

 

NAVIENT ALLEGEDLY ENROLLED 1.5 MILLION BORROWERS IN MULTIPLE CONSECUTIVE FORBEARANCES, RESULTING IN $4 BILLION DOLLARS IN ADDITIONAL INTEREST CHARGES.

 

IN A STATEMENT, NAVIENT SAYS IT DOES NOT AGREE WITH THE C-F-P-B’S ALLEGATIONS, HOWEVER, THE COMPANY STATES “THIS AGREEMENT PUTS THESE DECADE-OLD ISSUES BEHIND US.”

 

UNDER THE SETTLEMENT, NAVIENT IS BANNED FROM SERVING FEDERAL STUDENT LOANS.

 

NAVIENT WILL PAY A $20 MILLION PENALTY AND PROVIDE $100 MILLION IN RELIEF TO AFFECTED BORROWERS.

 

THE C-F-P-B SAYS IT WILL MAIL CHECKS TO ELIGIBLE BORROWERS AND AFFECTED CONSUMERS WILL NOT NEED TO DO ANYTHING TO OBTAIN REDRESS.

 

FOR SAN, I’M LT.