HARTFORD, Conn. (WTIC Radio) - Thousands of Connecticut residents will be seeing student loan relief following a $1.85 billion multi-state settlement with major student loan servicer Navient, State Attorney General William Tong announced Thursday.
Following an investigation that began in 2013, Tong explained that Navient was found to be allegedly conducting deceptive practices.
According to Tong, Navient allegedly deceived borrowers that were struggling to pay back loans into long-term forbearance programs while steering them away from other less costly repayment plans, among other bad practices.
"It's wrong to deceive people when we're making such an important, vital and, frankly, not optional decision to get a degree or an advanced degree," Tong said.
"It's not something people really have a choice on. You want to pursue a particular field of study and then get a job, you have to get a degree. Unfortunately, people are getting taken advantage of," he said.
In Connecticut, $19 million will be distributed across a little under 1,400 borrowers for private loan debt relief, $1.3 million in restitution will be split among about 5,000 borrowers, and another $140,000 in restitution will go toward the state's general fund, Tong explained.
Under the agreement, Navient will also be leaving the sector of the student loan business that is guaranteed by the federal government.
This massive settlement will hopefully set a new standard, Tong said, for the student loan servicing industry in a way that benefits borrowers.
Connecticut borrowers don't have to take any action, Tong said, but they can visit NavientAGSettlement.com for more information.
Related
