In recent months, student loan giant Navient, which was spun off from Sallie Mae in 2014 and retained nearly all of the company’s loan portfolio, has come under fire for aggressive and sloppy loan collection practices, which led to a set of government lawsuits filed in January, the New York Times reported yesterday. But those accusations have overshadowed broader claims, detailed in two state lawsuits filed by the attorneys general in Illinois and Washington, that Sallie Mae engaged in predatory lending, extending billions of dollars in private loans to students that never should have been made in the first place. “These loans were designed to fail,” said Shannon Smith, chief of the consumer protection division at the Washington State attorney general’s office. Read more.
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