The U.S. Department of Education released new federal loan servicer results that show that Navient helped more customers successfully repay their student loans and avoid the long-term consequences of default than other service companies for the Department of Education-owned loans. That was according to a release from the company that is moving from the Newark are to Wilmington.
For both the quarter and the 12-month period ending June 30 the data shows that Navient-serviced borrowers were the least likely to default on their student loans, compared to those whose loans were serviced by other major federal servicers.
Navient was recently spun off from student lender Sallie Mae. Sallie Mae and Navient have been under fire from media, critics and regulators over policies and collection practices.
According to the fourth quarter results, the default rates of Direct Loan customers with loans serviced by Navient continued to drop and were more than half that of the average of the other three servicer.
“The Navient team focuses on developing and testing proactive strategies to assist our borrowers to enroll in the repayment options available to them,” said Jack Remondi, president and CEO, Navient. “In fact, nine times out of 10 when we can reach past due customers, we can identify a solution to help them avoid default. On behalf of customers and taxpayers alike, we’re proud of our consistent track record of helping more student loan borrowers succeed.” Student loan default can have long-term consequences such as a negative impact on credit rating that reduces an individual’s ability to finance a home or car.
Since the company began to service Direct Loans in 2009, Navient customers have experienced a default rate nearly 30 percent better than those whose loans are serviced by the lowest two performers.
In addition, Navient-serviced customers have a higher use of income-driven repayment plans compared to customers serviced by other major servicers, according to federal statistics.
