Disheartened Houston man Texas not included in Navient settlement

HOUSTON, Texas (KTRK) – One of the largest student loan servicers has agreed to forgive $1.85 billion in student loan debt for 66,000 borrowers.

Navient has agreed to settle claims from 39 states that it tricked thousands of borrowers into a long-term and costly forbearance plan, forcing students to pay more than was originally borrowed.

David K. attended colleges in Texas and is not one of those borrowers receiving relief.

“It’s disheartening,” David said in a phone interview with ABC13.

Attorney General of Pennsylvania Josh Shapiro has announced that Navient, formerly known as Sallie Mae, will pay relief to resolve allegations of widespread unfair, deceptive and abusive student loan servicing practices and abuse in the granting of predatory student loans that began from 2002 to 2014.

SEE ALSO: Whose student loans are forgiven, who is eligible for payments in the Navient settlement

The settlement will cancel these loans once approved by a federal court.

David said he attended two colleges in Texas from 2003 to 2009 and over time took out loans totaling $35,000.

“I became unemployed and had no way of doing anything to get paid,” he said.

David said his loans were suspended, interest accrued and his salary was later garnished, but the balance did not go down. Instead, it doubled to over $73,000.

“I’m all for paying off a loan for what I owe. It’s the honest and honest part of doing and doing things. Now I don’t have the will or don’t even want to pay it. It’ll have to die with me,” he said.

Attorney David Fernandez said he worked with dozens of clients who fell victim to predatory lending practices.

“What Navient was doing, as I understand it, was approving loans for students who really weren’t qualified for loans to allow the school, the for-profit school to get federal loans “Fernandez said. “Most of my clients who come to see me are hard working people, ordinary people and also professionals who have a high income but are in distress. They need help.”

Although Texas is not among the 39 states listed in the landmark settlement, Fernandez said there is still time for state Attorney General Ken Paxton to do the same.

“I hope they do,” Fernandez said. “Obviously there are grounds and they found it in 39 states. I can’t imagine Texas being ruled out for being predatory.”

navigate released a statement on resolving legal issues with state attorneys general.

Borrowers will receive notices from Navient, as well as refunds of payments made on private loans after June 30, 2021. Federal borrowers eligible for a $260 restitution payment will receive a notice in the mail later this spring.

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