Government & State Sues Sallie Mae For Cheating Borrowers

CNNMoney reports that Navient, part of Sallie Mae, will be hit with a lawsuit from the federal government. It has been reported that they’ve been cheating borrowers on repayment rights. Illinois Attorneys General filed suit against both Navient and Sallie Mae.

Navient handles 12 million accounts and is currently the biggest student loan company. CFPB allegations is that they made borrowers pay more than they had to and “reported borrowers had defaulted on their loans, damaging their credit score”. They also made It hard for students to enroll in an income-drive repayment plan where the monthly payments can be lowered based off their pay.

Navient released a statement:

“the timing of this lawsuit — midnight action filed on the eve of a new administration — reflects their political motivations.”

In regards to Sallie Mae, Illinois Attorney General Lisa Madigan said she received thousands of complaints about their debt, “Sallie Mae put student borrowers into “expensive subprime loans that it knew were going to fail”.

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