Bradley attorney Julie Carter was quoted in the PennRecord on lawsuits filed against Navient, the largest student loan provider in the U.S., by the CFPB and the attorneys general of the states of Washington and Illinois.
“These lawsuits are focused on Navient’s student loan servicing practices,” said Carter. “The CFPB and the states of Illinois and Washington have alleged various causes of action related to application of payments, communications related to income-driven repayment plans, handling of co-signer releases and credit reporting for certain borrowers.”
The lawsuit may prove to be a turning point for student loan providers that are being placed under scrutiny by the CFPB since the Great Recession.
“Regardless of the outcome of the lawsuit itself, student loan servicers can expect more defined standards for the practices at issue in the lawsuits,” said Carter. “The causes of action in the lawsuits are based in part on practices the standards for which have not been clearly set through either rulemaking or through other administrative actions. Navient has stated that it welcomes reasonable, clear standards for student loan servicers to follow. It remains to be seen to what extent the lawsuit will directly result in more clearly established guidelines, but some clarification of what the CFPB may expect of servicers should result from either rulemaking or from the lawsuit itself.”
The complete article, “Student loan provider Navient intends to defend against suits brought by US, Illinois, Washington,” first appeared in the PennRecord on March 1, 2017.