Nessel announces additional information on Navient student loan settlement
1,576 Michigan borrowers will receive over $38.6 million in debt relief.
LANSING, Mich. (WILX) - Student borrowers in Michigan who amassed debt through loan servicer Navient are now eligible for relief as a result of a $1.85 billion nationwide settlement to resolve allegations of widespread unfair and deceptive student loan servicing practices and abuses in originating predatory student loans.
Attorney General Dana Nessel is one of 39 attorneys general to take part in the settlement, which was announced last week.
“The predatory practices used by Navient exploited students who wanted nothing more than an education,” Nessel said. “The company placed borrowers in risky subprime loans, causing them to incur debts they could never repay. This settlement reflects accountability for affected borrowers across the country.”
As a result of the settlement, 1,576 Michigan borrowers will receive over $38.6 million in debt relief. Those borrowers receiving the private loan debt cancellation will be contacted by Navient by July 2022, along with receiving refunds of any payments they made on the cancelled private loans after June 30, 2021.
Any federal loan borrowers who qualify for relief under the settlement do not need to take any action other than updating or creating their studentaid.gov account to ensure that the U.S. Department of Education has their up-to-date address.
For more information, visit www.NavientAGSettlement.com.
- Student loan borrowers left wondering whether forgiveness is still possible
- Michigan college graduates react to student loan pause until May
More on the settlement
The settlement includes conduct reforms that require Navient to clarify the benefits of income-driven repayment plans and offer to estimate income-driven payment amounts before putting borrowers into optional forbearances. Additionally, Navient will be required to train specialists who will advise distressed borrowers regarding alternative repayment options and counsel public service workers on Public Service Loan Forgiveness (PSLF) and related programs. The conduct reforms enacted by the settlement include bans on compensating customer service agents in a manner that incentivizes them to minimize their time spent counseling borrowers.
Copyright 2022 WILX. All rights reserved.
Subscribe to our News 10 newsletter and receive the latest local news and weather straight to your email every morning.