Thousands of student-loan borrowers have one week to file a claim for $16 million in relief from a major private lender. Here's how.
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- Private student-loan borrowers reached a settlement with lender Navient over the summer.
- Those borrowers could be eligible for $16 million in relief if they submit a claim by November 20.
- Navient denied claims it collected debt after borrowers got it discharged through bankruptcy.
Thousands of student-loan borrowers have one week to benefit from a recent settlement with a major private lender.
In July, Navient agreed to a $198 million settlement with private student-loan borrowers who claimed the lender continued to collect on debts that should have been discharged in bankruptcy. The settlement resolved those allegations following six years of legal battles. Navient denied any wrongdoing when it agreed to $182 million in debt relief for impacted borrowers, along with $16 million in cash for a settlement class of 4,607 borrowers.
"By any measure—be it the sheer volume of combined debt relief and cash or the average per-primary borrower debt relief of over $43,000—this is an extraordinary result for the Class," the settlement text said.
"It not only puts money in their pockets but, through credit remediation, starts to undo the harm that Defendants' collection efforts had on their borrowing capacity," it continued. "This credit remediation can have a profound effect on Class Members' long-term financial outlook and is just as impactful as the substantial debt relief the Class will receive."
Borrowers included in the settlement class have until November 20 to take part in the $16 million in cash relief. Here's what they should know.
Am I eligible?
The settlement class includes borrowers with private student loans serviced by Navient who meet the following criteria:
They filed for bankruptcy on or after October 17, 2005
Before they filed for bankruptcy, they were obligated to repay their loans
A court approved them for loan discharge via bankruptcy
And they have never reaffirmed their loans.
If borrowers did not make any payments after their loans were approved for discharge, they are not eligible to receive a payment.
How do I submit a claim?
Eligible borrowers can file a claim here. They will need the Unique ID and PIN on the settlement notice they received to file the claim, and those who did not receive a notice but believe they're eligible can contact the settlement administrator at 888-848-0808.
How much money will I get?
According to the FAQ, the exact amount a borrower will receive "will not be known until all Claim Forms are received and reviewed," but borrowers could receive anywhere from 20% to 100% of the damages a borrower suffered.
When will I get the payment?
The payments will go out after the district court grants final approval to the settlement and after any appeals are resolved — a process that could take "a significant amount of time," per the FAQ. The final approval hearing is scheduled for December 13 at the District Court for the Eastern District of New York.