Navient's Long-Awaited Reparations Begin

CFPB Starts Sending Payments to Borrowers

The Consumer Financial Protection Bureau (CFPB) has begun distributing payments to borrowers affected by Navient's misleading practices. This follows a $120 million settlement reached in 2024, with $100 million allocated directly to borrowers.

Misleading Practices and Delays

The CFPB accused Navient, a major student loan servicer, of pushing borrowers into costly repayment plans instead of more affordable options. The payments come over a year after the Trump administration delayed the CFPB's enforcement, raising concerns that borrowers might never receive compensation.

Advocates Criticize the Delay

Mike Pierce, head of the advocacy group Protect Borrowers, criticized the delay, stating it gave the industry a free pass while borrowers faced defaults and financial hardship.

Navient Denies Wrongdoing

Despite the CFPB's claims, Navient maintains they did nothing wrong. However, the CFPB insists that Navient's actions led to higher interest payments for millions of borrowers.

Payments Begin, but Questions Remain

The CFPB confirmed that a third-party company started issuing payments on February 13. However, the delay has left many questioning the effectiveness of consumer protection efforts.

The Need for Better Oversight

The case highlights the urgent need for better oversight in the student loan industry and faster action to protect borrowers.