Sallie Mae lied to us

Thousands of student loan borrowers are about to see their debt forgiven. Navient is one of the largest servicers of student loans in the nation and has recently settled in court having to cancel 1.7 billion in debt forgiving roughly 66,000 borrowers nationwide. This is a huge settlement and much-needed relief for those affected by Navient’s predatory lending practices.  

Although Navient did not admit fault in the lawsuit stating that they did not act illegally.  They are choosing to resolve claims they felt were unfounded citing that those claims would incur additional expense, time, and distraction from the overall goals of the company. It’s worth noting that those who are being relieved of their debt don’t have to do anything and a notice will be sent to individuals that qualify.  

Despite Navient’s claims I have a suspicion that the leaders of this company saw what’s coming down the pipeline. They’ve chosen the wiser path of getting ahead of this issue and settling before further damage is done to their business or reputation. The rapacious lending practices are in full view when we consider that Navient was borrowing money at a rate of 16% when the average loan rate rarely goes above 6%.  

Furthermore, they leveraged their private loan relationships to get on preferred lender lists at universities and colleges. They did this with full knowledge that these loans would default due to rising costs. As a student myself I feel particularly appalled when I hear news like this since we likely know someone who’s been an unwitting victim of a lending scheme. It goes without saying that if we choose to borrow money, we should only take what we need. Considering how rare it is to see accountability like this we should also do a thorough look at the company servicing the loan.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.