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Ohio State urges students to seek help outside the university in Navient suit

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Navient is the largest student-loan provider in the U.S. Credit: Olivia Balcerzak | Lantern Reporter

On Jan. 18, the Consumer Financial Protection Bureau filed a suit against Navient, the largest student loan distributer nationwide, misleading customers “at every stage of repayment.” While this lawsuit affects Ohio State students using the company to pay for school, the university does not have a uniform loan distributor and might be limited in its ability to help students, said spokesman Ben Johnson.

The CFPB released a statement outlining the offenses with which Navient, formerly a part of Sallie Mae, allegedly committed. Among these are failure to respond to complaints, incorrectly processing payments, creating obstacles for repayment and cheating customers out of money by deceiving them about rights to lower payments and requirements for co-signer release. Additionally, Navient is being accused of damaging the credit of the disabled, including veterans.

“For years, Navient failed consumers who counted on the company to help give them a fair chance to pay back their student loans,” Richard Cordray, director of the CFPB and former professor at the Moritz College of Law, said in the statement. “At every stage of repayment, Navient chose to shortcut and deceive consumers to save on operating costs.”

OSU spokesman Ben Johnson said that OSU Financial Services will continue to monitor the suit. For these kinds of cases that broadly affect OSU, this means communicating with close partners and elected officials in Washington, D.C., as well as other universities.   

Since Navient is a third-party provider, Johnson said there is little OSU can do regarding assisting students.

The Ohio State University, as with all other colleges and universities, does not select the servicer assigned to a federal student loan,” Johnson said in a statement.

The statement described the role of the U.S. Department of Education, which determines the provider students use once they apply for loans.

“The U.S. Department of Education contracts with private companies to help service the portfolio of federal student loans that current and former students have borrowed,” Johnson said. “Navient is one of these loan-servicing companies.”

Students whose loans are contracted through Navient are encouraged, Johnson said, to contact the Federal Student Aid Ombudsman Group of the U.S. Department of Education regarding any disputes that need settled confidentially.

Additionally, students might file an informal dispute resolution to the office of Attorney General Mike DeWine to have a specialist reach out to Navient and resolve issues. In the days following the Navient lawsuit, public information officer Kate Hanson said that the Ohio attorney general’s Office has only received 2 complaints.

While attorneys general from both Illinois and the state of Washington filed against Navient on the same day as the CFPB, Hanson said there are no known public enforcement actions made by DeWine against Navient.

Patricia Christel, vice president of Navient’s corporate communications, said in an email that Navient will deny allegations made by the CFPB.

We will defend ourselves vigorously against these unsubstantiated claims, but our core goal remains the same: to help our customers achieve financial success,” Christel said. “Navient is a leader in helping customers who need a lower payment on their federal student loans enroll in a plan that bases the monthly payment on their incomes.”

The CFPB set an ultimatum for Navient to settle by Inauguration Day, which Navient rejected. As of now, no new information has been released.

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