Navient, the largest of student loan providers, has recently settled a lawsuit. Part of this lawsuit settlement provides $26.3 million dollars of student loan forgiveness for Indiana residents. In addition, a $4.3 million fund will allow restitution payments to a much larger group of Indiana student loan borrowers.
Navient has made no admissions of wrongdoing. The company claims that they were properly following all established lending and collection laws. However, a settlement was negotiated to avoid litigation. The legal and political environment has become increasingly hostile to student loan providers. Navient desired to avoid direct confrontation and agreed to a record-making $1.85 billion settlement with 39 U.S. states.
One of Navient’s local offices is located in Indiana northeast of Indianapolis off of I-69. Navient has offices in 4 states. Especially within these states, Navient provides employment collectively for thousands of people. Indiana’s attorney general was mindful that too burdensome of a judgment in the matter could cause disruption of employment in the Indiana local offices.
However, the lawsuit claims that Navient has abused its power and size to perpetuate unfair and deceptive practices with student loan lending. For some time, student loan providers have been accused of predatory lending. Navient (along with various educational institutions in the past) have been accused of originating predatory student loans. This, among some other accusations, is the essence of the current state lawsuits.
Essentially, loans are given to students very quickly and freely in exchange for low-grade, overpriced educational services. In addition, Navient has been suspected of specifically targeting demographic groups that are unlikely to finish their education or put the educational program to good use. The waves of accusations started with many now defunct and closed colleges and universities. Now the blame for this and many other deceptive practices are being directed directly towards the student loan providers.
A one-time restitution payment will be offered to a large group of Indiana citizens with Navient student loan history. These people will be contacted by Navient. Forgiveness, however, will only be offered to a limited group of people who qualify.
For forgiveness, you must meet a specific set of criteria. First, such people must have had their student loans disbursed between 2002 to 2014. Second, you must have attended a specific group of for-profit educational providers, such as ITT Tech, some art schools, and others on this list. Lastly, the student loans must be delinquent and fall within certain collection and credit report guidelines.