Legal Action Facts

Who We Are

Navient by the numbers:

  • More than 400,000 borrowers serviced by Navient pay off their student loans every year.
  • Navient borrowers are 26% less likely to default.
  • More than half of Navient-serviced ED loans are enrolled in Income-Driven Repayment.



Federal student loan servicers such as Navient do not set loan terms like interest rates, loan limits, and repayment programs—these are established by the federal government. Servicers begin working with student borrowers after many important decisions about how much to borrow or where to attend college are already made.




Beginning in January 2017, the Consumer Financial Protection Bureau (CFPB) and six state attorneys general filed lawsuits against Navient asserting a variety of allegations. 

The primary allegation is that Navient harmed student loan borrowers by engaging in a policy and practice of “steering” borrowers away from income-driven repayment plans and towards forbearance.  This allegation and other allegations raised are false and demonstrably so.  The lawsuits remain pending and Navient intends to vigorously defend itself.  No court has found that Navient harmed consumers as alleged.

In one case (Washington) with regard to a single claim, a court concluded that Navient and certain predecessor companies should have provided more information to consumers about one of the requirements to obtain cosigner release, a benefit offered in connection with certain private student loans dating back more than a decade.  While Navient disagrees with the court’s conclusion and believes that the disclosures regarding cosigner release were clear and compliant with state and federal law, no evidence has been proffered showing that these disclosures harmed any consumers, and Navient will continue to fight the claim.  The court also rejected the attorney general’s attempt to hold Navient liable regarding a claim about communications to borrowers, finding that the attempt was premature based on disputed facts.



On May 19, 2020, Navient filed a Motion for Summary Judgment in the CFPB lawsuit, seeking to dismiss the case in its entirety.

Here are the facts:

  1. Navient is a national leader in enrolling eligible borrowers into income-driven repayment (IDR) plans, and more than half of the Department of Education loans we service are enrolled in IDR programs—more than any comparable servicer. Furthermore, servicers are paid up to 60% less so there is no economic interest to place a borrower in forbearance over an IDR plan.
    • The CFPB’s assertion that Navient steered borrowers away from IDR plans and toward forbearance is plainly false. Indeed, after nearly seven years of investigations and false claims, the CFPB has not been able to identify even one borrower who was “steered” away from an income-driven repayment plan into forbearance, and that is because we do not do this.
    • For the vast majority of loans, interest accrues regardless of whether the borrower was in an IDR or other repayment plan or in forbearance. Navient forbearance usage is in line with or lower than other major servicers.
  2. Navient has provided clear and easily understood notices to borrowers about IDR plans and their renewals.
    • The CFPB could not provide any evidence to support its assertion that Navient’s practice of notifying borrowers about IDR renewal was unfair and deceptive, or caused any borrowers to miss their renewal deadline.
  3. Navient accurately processes tens of millions of borrower payments every year.
    • The CFPB has failed to provide evidence that Navient mishandles borrower payments. Navient has a strong track record of ensuring that borrower payments are applied and allocated correctly.

Student loan servicers succeed when borrowers succeed.

Navient will continue to vigorously defend itself against these baseless claims with the facts and our strong performance and support of our customers’ success.

Fact sheet on Legal Actions:

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Navient Correspondence With Sen. Elizabeth Warren

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In 1965, President Lyndon Johnson signed the Higher Education Act into law. Since then, it has helped millions of Americans earn college degrees. Too many Americans, however, have had to borrow too much to do so, and outstanding student loan debt is now about $1.7 trillion. To address the issue, some states are adding state-specific regulations to federal student loans. While well-intended, this is misguided: such regulation would not only allocate scarce resources on the wrong solution, it would create more challenges for borrowers.  

Supporting preemption does not mean states must stay on the sidelines. They can promote college readiness, support efforts that improve college completion, make financial literacy a key component in the educational process, require colleges to provide transparent data on debt and costs, and establish state student-loan ombudsperson offices. Further, if borrowers believe they are victims of fraud, misrepresentation, or some other consumer protection harm that does not conflict with federal law, they may file suit in state court or turn to their state attorney general for recourse.

Servicers, states, and the U.S. Department of Education must work together to develop a strong, central set of federal regulations that work for borrowers.

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