How the Navient Lawsuit Will Affect Your Student Loans
It seems the government has begun to understand the mess it’s gotten itself into with student loans. Recently, we have seen Government intervention with programs aimed at those who went to for-profit colleges including Devry, Corinthian Colleges, and ITT Technical Institute.
This has brought a lot attention to the for-profit-school industry and the mass amount of student loans their attendees walk away with. Which is why there are new government programs available to assist these borrowers with their student loans.
However, what we haven’t seen until now is the Government cracking down on actual student loan lenders such as Navient. Many were shocked to hear about the recent lawsuit against Navient brought on by the Consumer Financial Protection Bureau (CFBP).
The CFBP alleges that Navient “systematically and illegally (failed) borrowers at every stage of repayment.” This includes, lost paperwork, misapplied payments, surprise late fees, processing delays and overall confusion.
It was also mentioned that Navient created obstacles to repayment by providing bad information, failing to act when borrowers complained and deceiving private student loan borrowers about requirements to release their co-signer from the loan.
If found true, restitution will surely be given to the borrowers who suffered from Navient’s actions.
So, Will Navient Student Loans Be Forgiven?
If restitution is to be paid, it’s unclear whether it will be paid in the form of reimbursements or loan forgiveness; either way, hundreds of thousands and possibly millions, of borrowers could be off the hook for their remaining loan balances.
While no one has the answer at this point, it seems that things are heading in the right direction and could mean very good things for a lot of people.
Will This Cover Federal And Private Loans?
The loan forgiveness programs currently in place do not include private student loans which puts these borrowers in a very difficult position. However, the great news is that private student loans are covered in this new lawsuit.
Navient is the largest student loan lender in the United States and there is no doubt that millions could be affected by this, until then here is what we suggest doing:
What Should You Do If You Have Loans With Navient?
1. Have Everything In Writing
Have ever contacted your student loan lender in the past only to find out later that your request had not been processed? Well, if you’re a customer of Navient’s we are sure you are no stranger to this scenario. While hopping on a call with your lender can often be easier, it isn’t always the best idea; especially now.
Going forward it is very important that you communicate with your lender, whether it’s Navient or another company, in writing. It’s ok to call your lender but we recommend that you email them as well to discuss any changes or actions that need to be taken for your account.
This includes formal requests, payment instructions and any other materials that relate to your student loans. Keeping a paper trail gives the borrower that necessary added protection.
2. Get Yourself on Automatic Payments
Getting your loans on automatic payment is extremely important as it ensures that your payments get to the lender and that there is an electronic copy of the transaction. If anything were to be done in error it is very easy to get it resolved if both parties can see the transaction electronically. While, the older borrowers tend to prefer sending checks to automatically paying, this does place them at a higher risk for lost payments and then for late charges to be added. Additionally, in many cases, you may be eligible for a 0.25% interest rate deduction when you enroll in automatic payments.
3. Don’t Forget About Your Credit Score
f you have outstanding student loans it’s crucial you keep a close eye on your credit score as that is directly tied to your student loan payments. Since student loan lenders are not always the most truthful, you need to ensure that your student loan payments are recorded accurately to the credit bureaus. To error on the side of caution, it is safe to assume that mistakes will be made meaning the sooner you know, the better.
4. Know Your Student Loan Options
Now more than ever, it is extremely important that you understand the programs available and the options you have with student loan repayment. If you are one of the millions who went to a for-profit college and believe you were mislead by your school, you may qualify to get your loans completely erased. Contact us today and one of our many student loan specialists can assist you in finding the best option for you 800.940.8911.