CFPB Sues Largest U.S. Student Loan Company

Navient is being sued for “failing borrowers at every stage of repayment.”

The Consumer Financial Protection Bureau is suing Navient, formerly part of Sallie Mae, for “systematically and illegally failing borrowers at every stage of repayment.” This was one of the last announcements by the CFPB before Donald Trump became president on January 20.

The CFPB hopes to recover millions of dollars for borrowers who were cheated by Navient.

According to the CFPB: “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.”

Read more from the CFPB Press Release:

The Bureau seeks to recover significant relief for the borrowers harmed by these illegal servicing failures.

“For years, Navient failed consumers who counted on the company to help give them a fair chance to pay back their student loans. At every stage of repayment, Navient chose to shortcut and deceive consumers to save on operating costs,” said CFPB Director Richard Cordray. “Too many borrowers paid more for their loans because Navient illegally cheated them and today’s action seeks to hold them accountable.”

Formerly part of Sallie Mae, Inc., Navient is the largest student loan servicer in the United States. It services the loans of more than 12 million borrowers, including more than 6 million accounts under its contract with the U.S. Department of Education. Altogether, it services more than $300 billion in federal and private student loans.