Carson City, NV (AP) - Thousands of Nevadans will share in a big settlement 39 state attorneys general negotiated with a major student loan collecting company accused of abusive lending practices tied to more than $1 billion in loans, Nevada Attorney General Aaron Ford said Friday.
Navient agreed to cancel $1.7 billion in debt owed by more than 66,000 borrowers across the U.S. and pay more than $140 million in other penalties, under the deal first disclosed on Thursday.
Ford says 3,952 federal loan borrowers in Nevada will receive a total of $1.05 million in restitution and 592 Nevada borrowers will receive private loan debt cancellations totaling more than $17 million.
The deal resolves claims dating to 2009 when Navient began steering struggling student loan borrowers into costly terms instead of counseling them about more affordable income-driven repayment plans, Ford said.
“This settlement provides relief to thousands of Nevada students who were victims to Navient’s misrepresentations and predatory practices,” he said. He said it “also serves as a caution to other loan servicers that these practices will not be tolerated, and it is their responsibility to assist borrowers in an honest and professional manner.”