* Let people know what they're getting into.*

Are you suggesting that when people signed for the loan - which was not with Navient, as they're on the servicing and collections side - that they didn't know what the terms of repayment would be?

The central problem I have with a loan like this is that it is tied to a socially encouraged activity that is central to most Americans' ideas of a successful path to adulthood. If we're going to socially encourage this, it needs to have some backstops to catch folks who fall.

Whether the collections is outsourced or insourced, your average student borrower isn't planning on having their life's trajectory fall apart. They aren't expecting the hardships that lead them to need remediation. However many warnings you provide them on the front end, it's at the time of crisis that they need advice and guidance. Navient has been horribly negligent and predatory in this regard. Anyone taking on the job of preferred collector of gov't loans should be required to act in the interests of the borrowers - aka the American public.

I agree with your paragraph 1, not with paragraph 2. The US Dept. of Ed. could have come up with any number of solutions including outright forgiveness, work programs, access to cheap fee-based financial planners, more scholarships, changes to the tax code for the borrowers, or hiring incentives for employers. Instead, it chose to sell it off the debt in order to keep the accounting balanced under the desired time frame.

Navient should pay what the court compels it to if outright deception is found, but let's not overstate their role in the general problem around the structural non-sustainability of federal education loans, and the short-sightedness executive decision to spin off the liabilities into private hands.

I don't think we necessarily disagree - you think outsourcing the liabilities was a bad move, presumably because in private hands, collections will be ruthless... I'm complaining about the same point. I just see no reason why "private actor" must imply ruthlessness. The terms of the contract or laws governing the collection of gov't loans could be written to enforce a fiduciary-like expectation into the arrangement.

When I got my student loans, I had to do a whole bunch of online orientation. It included the various repayment plans, and even what the monthly oayment would be under each plan, and how much total interest each plan would eventually cost me. I think its a federal requirement that this information is provided before the loans are disbursed.

If someone doesn't take the time to understand their student loans, which are one of the most important things in their lives at that age, I just don't know what to say.

I'm glad you got that coaching, but I don't think that is very universal as a practice... My student loans were handed over with the usual fine-print paperweight. I had prior knowledge of how they worked, and fortunately never had to seek payment remediation, but that's just me being lucky. I want a system that mandates supportive care of the customer (who, in this case, is not a professional financial investor, but most likely a kid without a wealth of life experience to draw on).

I was a kid then, and if I hadn't been given an explanation of how the loans worked, I would have looked it up. I was borrowing tens of thousands of dollars, and I wasn't about to screw that up.

I always look up the terms of any loans I take, including student loans, car loans, credit cards, etc. Honestly, is that too much to expect?

Must be those gosh darn millennials. Regardless, this is a separate issue from a loan servicer falsely advertising that it will help you cope with dept.

> Let people know what they're getting into.

Let's say an honest lending start-up rushes to fill this niche and then rejects people's applications based on imperfect academic record, lack of summer jobs or internships (so potential laziness), subpar math skills and very minimal knowledge of foreign languages (so indicative of poor information retention). It also honestly tells you that art history majors have no place in a business world, and honestly maybe a career in plumbing is a better fit.

This is just based on their model, and the rejection is worded in a nice, legally safe and sound, way.

How long before such lender is being sued into oblivion for discriminatory practices?

Well, no one's 100% safe from discrimination lawsuits.

However, looks like such practices are not considered discriminatory by law.

> Two federal laws, the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA), offer protections against discrimination. The ECOA forbids credit discrimination on the basis of race, color, religion, national origin, sex, marital status, age, or whether you receive income from a public assistance program.

Naviant isn't a loan provider. The government makes the loans. It's job is literally to make sure people make their payments.

I understand the distinction. I'm suggesting that, since Navient is also responsible for remediation, they be held to a higher standard for guiding customers' adverse payment options.

"Let people know what they're getting into." was intended to refer to the whole loan process, but specifically (in Navient's case) to the remediation options they present, and how they present them. That could include things like: 1) Guiding borrowers towards income-based repayment rather than deferment or forbearance, and 2) Recommending external options such as re-financing or consolidation where possible and advantageous.