A $1.85-billion settlement will relieve over 6,000 Oregonians of their student debt – ending a long legal fight between student loan servicer Navient and 39 states.
Navient has long been under fire for deceptive business practices, resulting in financial harm to approximately 66,000 borrowers across the 39 states, which include California and Washington.
“For over a decade, Navient promised student loan borrowers it would help them find the best repayment options. Instead, they steered struggling borrowers into more costly payment plans,” said Oregon Attorney General Ellen Rosenblum, who announced the settlement on Thursday. “I sincerely hope this will help many of them move on with their lives.”
The settlement may come as life-changing to those who have been overwhelmed by their debt – in Oregon, about 5,500 federal loan borrowers will be receiving over $1.4 million in restitution, and another 800 will be receiving over $22 million in private loan debt cancellation from Navient.
As part of the settlement, Navient is also required to update its borrowers on the new changes to the U.S. Department of Education’s Public Loan Forgiveness program. This program works to make loans more easily forgiven for borrowers who have made payments for 10 years and have worked in public service.
Those who qualify for debt cancellation and restitution will be sent a notice from Navient, and don’t have to take any additional steps to receive the money they are owed. However, Rosenblum added that borrowers should check studentaid.gov to make sure their information is up to date with federal officials.
“We will never break the cycle of student debt if we don’t hold student loan servicers accountable,” said Rosenblum.
By Momoko Baker
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