Is the Navient lawsuit real?

The Navient student loan settlement is an agreement between Navient and attorneys general for 39 states and the District of Columbia to resolve lawsuits that accused Navient of: Giving high-interest loans to students who it knew likely could not repay the debt.

Settled: State lawsuits

Several states filed lawsuits against Navient over the years, citing unfair lending practices, deception and mismanagement of loan products.

In addition, Navient will pay $142.5 million to the attorneys general. A total of $95 million in restitution payments of about $260 each will be distributed to approximately 350,000 federal loan borrowers who were placed in certain types of long-term forbearances.

The settlement, announced Jan. 13, 2022, comes after five years of litigation with states. A similar lawsuit filed by the Consumer Financial Protection Bureau is ongoing. Navient was, at one time, the largest student loan servicer after Sallie Mae, its parent company, shifted its portfolio there in 2014.

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In January, Pennsylvania Attorney General Josh Shapiro announced that Navient agreed to cancel $1.7 billion in subprime private student debt owed by 66,000 student loan borrowers, primarily at for-profit schools such as ITT Technical Institute and the Art Institute.