In a recent court filing, Navient argued that it has no obligation to "act in the interest of the consumer," denying any responsibility to provide accurate information or reliable customer service for students trying to repay college loans.
The student loan servicer is the largest such company in America. One out of every four borrowers in the country has their student loan repayments handled by Navient on behalf of the Department of Education. Yet it faces a lawsuit brought in January 2017 by the U.S. Consumer Financial Protection Bureau and the attorney general of Illinois and Washington for improper lending practices.
Among other things, the CFPB charges that Navient:
- Steers struggling borrowers into paying more than they are required to
- Does not correctly apply borrower payments to their accounts
- Concealed information about re-enrollment for income-driven payment plans
The Bureau estimates that Navient has overcharged as much as $4 billion in interest on student loans.The Department of Education should not tolerate this kind of exploitation from one of its contractors.
Tell Secretary of Education Betsy DeVos to stop exploiting borrowers and drop Navient as a student loan servicer.
This is not the first time Navient has been charged with cheating borrowers. In 2015 an investigation by the Justice Department revealed that the company had been charging service members excess interest rates since 2005, despite clear government guidelines making members of the armed forces eligible for subsidized loans. Navient was forced to pay $60 million in compensation to 78,000 service members.
Nearly 6 million borrowers depend on Navient to handle their student loan payments to the Department of Education - and the Department refers questions about repayment or restructuring to the servicer. Yet Navient is arguing that its only obligation is to collect money for the Department, not to provide information or customer service to the student borrowers.
"If that's all they're doing," says David Bergeron, a former section head at the Department of Education, "the Treasury Department and the Internal Revenue Service would do it better. What this means for the Education Department is that it needs to fire Navient."
Stop the exploitation. Tell Education Secretary Betsy DeVos to fire Navient now.