U.S. Senators Chris Van Hollen (D-Md.), Elizabeth Warren (D-Mass.), and Richard Blumenthal (D-Conn.) sent a letter to Secretary of Education Miguel Cardona urging him to provide additional relief for student loan borrowers affected by Navient's decades-long record of deceptive and abusive practices.
While the historic $1.85 billion multi-state settlement against Navient provides critical and long overdue relief for borrowers cheated by the company, many borrowers are still ineligible for student loan relief under the settlement terms, and others may not receive appropriate compensation for the harms they suffered under Navient. The senators called on the U.S. Department of Education (ED) to take additional action to redress all of Navient's victims, including by building a path toward loan forgiveness for the millions cheated by Navient through creating an income-driven repayment waiver similar to the one the department recently made available to correct the broken Public Service Loan Forgiveness program.
"Given that this settlement will not fully compensate or remedy the harms inflicted by Navient on student borrowers, and in light of ED's repeated failures to address Navient's predatory practices, ED has the responsibility to use its tools to make things right for Navient's victims, wrote the senators.
Last month, Navient and 39 bipartisan state attorney generals reached a historic $1.85 billion settlement that requires the company to cancel $1.7 billion in delinquent private student loan debts and pay $95 million in restitution.
Only about 350,000 borrowers are each eligible for a $260 restitution payment far from the thousands in additional debt that many borrowers incurred due to Navient's predatory practices.
Instead of guiding borrowers with appropriate services and protections, Navient engaged in predatory practices including deceptive servicing practices, steering borrowers into costly long-term forbearances, and making subprime loans to borrowers they knew would not be able to repay
The senators asked ED to answer how it plans to take action to provide relief to the millions of borrowers cheated by Navient for the full scope of the financial injury they experienced.
However, only about 66,000 of all student loan borrowers serviced by Navient would be eligible for loan forgiveness under the terms of the settlement, leaving millions of borrowers ineligible for any forgiveness
Senator Van Hollen is one of the nation's leading voices for student loan borrowers, holding companies accountable for predatory practices that harm and trap borrowers in years of debt and leading the call for affordable higher education.
- Senator Van Hollen, along with Senators Warren, Blumenthal, and Tina Smith (D-Minn.), sent letters to four federal loan servicers, requesting information on their plans to support borrowers when student loan payments resume.
- Senator Van Hollen, along with Senators Warren, Blumenthal, Smith, and Sherrod Brown (D-Ohio), sent a letter to Maximus, the company that is assuming Navient's federal student loans servicing contract, questioning its troubling history and seeking assurances that borrowers will receive appropriate services and protections during the transition.
- Senator Van Hollen, along with Senators Warren, Blumenthal, Smith, Brown, Cory A. Booker (D-N.J.), Bernard Sanders (I-Vt.), Tammy Baldwin (D-Wis.), and Edward J. Markey (D-Mass.), sent a letter to the Department of Education urging Education Secretary Miguel Cardona to use his authority to automatically remove all student loan borrowers in default.
- Senator Van Hollen, along with Senators Warren, Blumenthal, Brown, Smith, Markey, and Robert Menendez (D-N.J.) sent letters to the heads of Pennsylvania Higher Education Assistance Agency, Granite State, and Navient calling on them to correct past errors with borrowers' accounts and address growing concerns over their preparedness to transfer millions of borrowers to new servicers.