The lawsuit just filed against the country’s largest student loan servicer, Navient, could provide some much needed relief to borrowers.
The government claims Navient misled, even cheated students who were trying to pay back loans.
“It’s crazy because I’m trying to pay,” said Julie Alicea, who works in Tampa at a job unrelated to her degree from Kaplan University.
Despite her attempts to pay back the loan, she said Navient is not helping.
She wants to get on on of the popular income-based repayment plans, but instead the company keeps steering her towards a costly forbearance and won’t send the paperwork she needs to apply.
“I’m still waiting. Since early summer of last year,” she said.
Alicia is far from alone.
In fact, there are so many borrowers around the country with similar experiences that the Consumer Financial Protection Bureau just filed a suit against Navient, alleging shady practices.
“When I look and see a client coming from Navient, frankly I cringe,” said Christie Arkovich, a student loan attorney in Tampa.
Arkovich sees the frustrations first hand almost daily.
She said clients repeatedly get mixed messages and can never get the information they need on the income based programs.
“They’re pushing forbearance. And forbearance sounds great because it’s zero payment — everybody loves that — but the problem with forbearance is it just keeps adding to the balance,” she said.
And while it adds to your balance, it’s adding to Naveint’s pockets.
For its part, the company vehemently disputes the lawsuit, calling it “unfounded” and “politically motivated.”
But experts suggest anyone with a Navient loan should pay close attention to where this goes.
“Finally something’s going to get done, something’s going to happen,” Alicea said. “I’m really hopeful.
It could lead to refunds for borrowers or even partial loan forgiveness.