The Largest Student Loan Company, Navient is facing a Lawsuit

Article written by Eat Pray Budget

I loathe my student loan debt, but then again, no one likes their student loan debt! Some news broke earlier this year that added a bit more understanding to the heartache I’ve experienced with my student loan provider. A major student loan company, Navient, is being sued by the Consumer Financial Protection Bureau. I am particularly interested in this (OK part of me is excited to see them get theirs!) because Navient happens to be the only company I owe any debt to. Navient is formerly Sallie Mae and is the student loan servicer for the Department of Education. So we actually owe the Department of Education, but Navient is the manager of those loans.

To say I wasn’t surprised by this news is an understatement. I have had countless issues with Navient. I mean, my hair is a bit grayer, well it would be if it weren’t for my epic hair dresser, due to Navient. They frequently add fuel to my fire to pay them off quickly with how difficult they are to work with. I cannot wait to kick Navient to the curb and no longer owe them a cent! Apparently, I am not the only one who has had issues, and it’s interesting to see a federal agency step up on the issues.

The Consumer Financial Protection Bureau (CFPB) is in place to protect the financial rights of the consumer. Now, I’m not a big fan of the CFPB because they tend to stick their nose into business that isn’t theirs. But that’s another blog post on a completely different blog. Regardless, the CFPB is a resource for consumers. They hear consumer complaints and investigate them for legitimacy. It seems the complaints were frequent and valid in nature resulting in the CFPB taking action.

According to an article on the CFPB website, the CFPB claims Navient has deceptive practices, created difficulties in repayment options, processed payments incorrectly and did nothing when consumers complained. I know from past employment experience, that if any of these are true, Navient is in big trouble. Due to the CFPB, business cannot handle consumer money improperly. They can’t even look at it the wrong way. If they do, they’re in for a rude awaking and maybe, Navient is!

Mr. Biker and I have been paying off debt using the debt snowball method. The debt snowball method has you pay the smallest balance first, and then when that’s paid you roll money into the next smallest debt. This creates a snowball of money to throw at the remaining debt. My Navient loan’s are the largest debts we have so they came last on the payoff schedule. I was shocked and extremely frustrated when I learned I couldn’t pay toward principal only on these debts. Not only that, I couldn’t even pick a loan to pay extra toward. I simply have to make my unscheduled extra payment and Navient pays the interest balance first and then splits the payments between my two loans.

When I called Navient about this… I sat on hold for 30 minutes only to get stuck in a phone tree. Grrr! I emailed them about this and was told, payments are applied to fee first and then to principal. They also said borrowers can specify which loan to pay on however, that option isn’t available to me because my loans are grouped. What?! They’re two different loans. Stop making it so difficult, Navient! Long story short, I got irritated and said fine, we’re going to pay this debt off within the year anyway. This just gives us more of a reason to stay intense about paying off debt!

Now here’s the deal folks, I am ridiculously grateful for my degrees. They have afforded me opportunities that I wouldn’t have had otherwise. In hindsight, I probably wouldn’t have gone into debt for those degrees. I would have applied for a lot more scholarships, would have started working and saving at a much younger age and would have cash flowed it. Coulda, woulda, shoulda. That said, do I dispute I owe the debt. Absolutely not! Not even a bit. Do I want the government to forgive those loans, it’d be nice from a personal perspective but on a larger scale, NO! That’s a terrible idea! What I do want is the opportunity to tell my money where to go on my extra payments. To specify which debt to pay and to pay principal only on those extra payments.

Navient also messed with our United States Disabled Veterans. This part irritates me more than my personal issues with Navient. We all know that student loan payments show up on our credit reports just like any other debt. Veterans whose disability is due to their service in the military have the right to request student loan forgiveness. This is part of the Total and Permanent Disability program, and I agree with it wholeheartedly! Navient failed to correctly report to the credit agencies the relief of these student loans which in turn caused harm to the Veterans credit reports. Are you kidding me?! You had one job, Navient!!!

Needless to say, I am interested to see how this pans out. The CFPB seeks to obtain significant relief for folks this has impacted. Realistically this will take years, but hopefully this is a step in the right direction in keeping these loan servicing companies honest. Yes, we owe the money and should pay it in full but the company we’re working with doesn’t have the right to deceive, take advantage or negligently harm those they’re working with.

The borrower is slave to the lender (Proverbs 22:7 (NIV). If you’re in student loan debt, RUN!!!! RUN FOR YOUR LIFE!!! If you are a consumer having issues with a student loan company check out the CFPB’s website to file a complaint – http://www.consumerfinance.gov/complaint/#student-loan.

I’m sure there will be more to come on this topic but until next time, spend safe!

CFPB Sues Nation’s Largest Student Loan Company Navient for Failing Borrowers at Every Stage of Repayment http://www.consumerfinance.gov/about-us/newsroom/cfpb-sues-nations-largest-student-loan-company-navient-failing-borrowers-every-stage-repayment/ January 18, 2017

Note: I am not a personal finance professional. All my advice is strictly opinion. I am not responsible for your success or failure. If you need professional financial help, please seek advice from a trained professional.

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Photo by DonkeyHotey

Comment & let us know if you’ve had a great or horrible experience with Navient!!!

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2 Comments

  1. June 27, 2017 / 9:50 PM

    This is a great picture! I love the part when she says she loves her degree and the opportunities it has afforded, but that Navient! Grrrr! I can RELATE!! I’m tired! I feel a slave to the lender big time. But GOD! 😊

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