LAS VEGAS (KTNV) — $1.7 billion in student loans will either be canceled, paid back to students, or relieved from Navient accounts, and Nevada borrowers will receive over $18 million in relief.
Attorney General Aaron Ford announced a settlement with the student loan servicer on Friday.
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Ford says the settlement resolves claims from 2009 onward that Navient steered struggling student loan borrowers into costly long-term forbearances instead of counseling them about the benefits of more affordable income-driven repayment plans, despite representing that it would help borrowers find the best repayment options for them.
As part of the settlement, Nevada will receive a total of $1,053,752 in restitution payments for 3,952 federal loan borrowers. Additionally, 592 Nevada borrowers will receive a total of $17,140,858 in private loan debt cancellation
“This settlement provides relief to thousands of Nevada students who were victims to Navient’s misrepresentations and predatory practices,” said Ford in a press release.
“This settlement also serves as a caution to other loan servicers that these practices will not be tolerated, and it is their responsibility to assist borrowers in an honest and professional manner.”
Borrowers receiving private loan debt cancellation will receive a notice from Navient, along with refunds of any payments made on the canceled private loans after June 30, 2021.
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Federal loan borrowers who are eligible for a restitution payment of approximately $260 will receive a postcard in the mail from the settlement administrator later this spring.
Federal loan borrowers who qualify for relief under this settlement do not need to take any action except update or create their studentaid.gov account to ensure U.S. Department of Education has their current address.
For more information, visit NavientAGSettlement.com.