- Navient, one of the largest student loan servicers, will cancel $1.7 billion in private student loans after a deal it reached with 39 states.
- The lender was accused of giving out private loans to students who would be unable to pay them.
- As part of the settlement, Navient denied that it violated the law.
Navient, one of the largest student loan servicers, will cancel $1.7 billion in private student loans after a deal it reached with 39 states.
The settlement, announced on Thursday, resulted from accusations the lender gave out loans to millions of borrowers who’d be unlikely to be able to repay them. It resolves all six outstanding state lawsuits against Navient, company officials said.
The loans in question are private loans, meaning they are not guaranteed by the federal government. As part of the settlement, the company will make a one-time payment of about $145 million to the states.
Nearly 66,000 borrowers are expected to get their loans cleared under the $1.85 billion deal.
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