Student Loan Servicer Settles Predatory Lending Claims

A student loan servicer reached a settlement with 39 state attorneys general, resolving claims of unfair and predatory lending practices.

The Office of the NY Attorney General alleged the firm directed borrowers into costly and burdensome loan arrangements instead of more affordable repayment plans. The agreement includes canceling roughly $1.7 billion in loans and paying $95 million in restitution, as well as a series of servicing reforms for future loans.

In a statement, the firm expressly denied violations of the law and allegations of causing borrower harm.