“The Consumer Financial Protection Bureau is suing the nation’s largest student loan company, Navient, for failing borrowers at every stage of repayment. Navient, formerly part of Sallie Mae, per the CFPB, illegally cheated borrowers out of repayment rights through shortcuts and deception”
If you’ve ever had to repay a student loan, you know it seems impossible to pay off. Well, the major federal financial agency looking out for consumers says it was intentional, and the nation’s biggest student loan processing service, Navient/ Pioneer Credit Recovery broke the Law.
This action comes as the Bureau takes steps to ensure that all student loan borrowers have access to adequate student loan servicing. In 2015, the Bureau released a report outlining widespread servicing failures reported by both federal and private student loan borrowers and also published a framework for student loan servicing reforms. As part of this work, the Bureau has continually raised concerns around illegal student loan servicing practices. The Bureau has called for market-wide reforms and prioritized taking action against companies that engage in illegal servicing practices.
Student loans make up the nation’s second largest consumer debt market. Today there are more than 44 million federal and private student loan borrowers and collectively these consumers owe roughly $1.4 trillion.
In a study last year, the CFPB found that more than 8 million borrowers are in default on more than $130 billion in student loans, a problem that may be driven by breakdowns in student loan servicing. Students and their families can find help on how to tackle their student debt on the CFPB’s website. Student loan borrowers experiencing problems related to repaying student loans or debt collection can also submit a complaint to the CFPB.
