Student Debt Giant Navient to Borrowers: You’re on Your Own
bloomberg.com
bloomberg.com
So, pardon in advance for the vulgar language, but why the fuck is this OK? From any company?
I'm getting real damn sick and tired of "what the big print gives, the spidery print takes away" and how we're all just supposed to be OK with this, as if this is how the world works or some crap.
If your public advertising--especially, but not limited to, when administering a service on behalf of the government--explicitly says "call us and we will help you," your company should not then be able to turn around and say "well, caveat emptor for calling us, sucker." Meanwhile, the handful of agencies devoted to trying to help the individual get any kind of a fair shake from the company "provider" that massively outguns any one individual customer, are all under attack from all sides as being "too heavy handed." (I love the CFPB, in case you can't tell.)
Oh, and this whole "consumer" crap? I'm not a "consumer," I'm a customer. I'm not consuming anything from a financial services provider, I'm using their services. Stop with the idea that all of us are just mindless drones, eating our Pac Man-like dots on the way to a swift end, and maybe get back to the idea that real people are on the other end of those faceless account numbers.
(FWIW, this applies to every company with mandatory, binding arbitration clauses, including the oh-so-enlightened participants in Y Combinator. Don't restrict my ability to hold you to your side of the agreement while reserving all rights to pound me into the sand at your leisure.)
I propose "the bigger the print, the stronger the statement". Therefore, if you make one claim in 24 point and then attempt to rescind or modify it in 8 point, the 24 is legally binding because it was larger and so nullified the smaller. This also means that if you want to place limitations (like 'one per customer' etc) on an offer you make in print, those will have to be printed in an equal font in order to be valid.
More seriously, I think first amendment protections for commercial speech are too generous. Game theory tells us that perverse incentives will often win out, and while it's tempting to fall back on caveat emptor it's also a cop out. The reality is that the huge and increasing information asymmetry between organizations and individuals leads inevitably to inequitable outcomes; further, it's entirely predictable that by swamping the recipient of a contract with reading material they'll just go ahead and agree to it because it's not obvious that it will be worth the effort of analysis. I can't remember the last time I read a EULA, and I like reading contracts and legal documents.
Free business idea: a fiduciary AI that parses contracts, simplifies contractual terms for maximum clarity, and rates contracts on their adherence to/deviation from industry norms.
99.9% of the casino adds have to show people sad about losing - before we get 1 winning ad
"Visit Golden Palace photo of a roulette wheel for a 46% chance of breaking even!"
I figured that adjusting say 8% of the ads to reflect an (imaginary) 8% incidence of problem gambling would actually be more effective, by balancing the legitimate commercial desires of the casino, the legitimate worry of gambling addiction, and making the billboards just unpredictable enough to keep people playing...er, guessing.
As far as I understand, many clauses will then be automatically invalid if they are too one-sided for the company. Also maximum durations of contracts are greatly restricted while certain standards for contract cancellation rights are enforced.
[1] https://en.wikipedia.org/wiki/Standard_form_contract#Contrac...
Consider the following three statements.
Consent cannot exist when the information asymmetry becomes too great.
The information asymmetry between a massive corporation (as compared to some mom and pop shop) and an individual consumer is great enough to invalidate consent.
We allow and legally enforced consent between these entities (with very limited exceptions; even things like arbitration clauses tend to be binding).
One of the above statements cannot be true for us to be moral in our actions, yet all three seem true. I honestly have a moral issue with how this all works, even though I'm not sure how to fix it and recognize a fix may completely change how we do business.
Basically, if your contact/agreement is not upfront about the downsides then those are nullified.
Sadly, people might still decide to do it. Definitely seems like usury laws would apply.
Most of the legal agreements - customer/consumer usually lose because of the super vague and often-in-favor of the company providing the loan/service.
I am not sure if you meant font size literally.
The EU has a ton of regulation like that.. For example you can't say "free" if it's associated with a subscription or other tricks. You must advertise the complete price if selling phones with binding subscription, etc..
IMO, there is still many shady business practices to kill. But the EU is doing a great job at this.
--- Good luck in the US, maybe you should just start by targeting the payday loan industry... But not sure the current President is going to help Elizabeth Warren fix anything.
shareholder capitalism. they have zero accountability except to their shareholders.
Random thought that just came to mind. Have coalition of debt holders (borrowers ) ever considered buying stock in these companies to influence them in the form of another company that is jointly owned or invested in by thousands or tens of thousands of folks?
Eg, mass activism campaign launches request for everyone to invest X% of what they normally would have paid into loans for the month (above the minimum thresholds of course), and/ or y% of disposable income into this fund. Now obviously one or ten people doing this will own just a few hundred stocks, but thousands doing this get tens of thousands of stocks-- thats when it could get interesting ;)
Obviously, would not be available to those really struggling under massive loan burdens and struggling to make every payment, BUT for those in the AND gate between reasonably high loan burden and comfortable income, which is a huge overlap with HN by the way, the impact could be massive.
In the end the results could be beautiful though: cannibalizing capitalism , - an inside job.
this is one of the side effects of the massive income and wealth inequality American style capitalism causes.
Individual mega-investors are no doubt powerful, but what about investor collectives. if a single company and/or entity can take on even 1/10th the power of Icahn collectively, it is something worth considering.
Doesn't matter. As the saying goes: if you owe the bank $1,000, you have a problem. If you owe the bank $100,000,000, the bank has a problem.
Debtors as a group probably would have a great deal of collective bargaining power.
The consequence of course would be that student loans would cease being made, or be made much less frequently. This would have effects, some good, some bad.
Apps like Robinhood have opened the ability for folks earning even less than 50k , to comfortably invest.
Many tens of thousands may be interested; there could be a bigger market opportunity than you think.
Make radical changes that impact the servicer negatively and the lender will switch to a new servicer to manage its payment flow.
The coalition of debt holders is now stuck with shares of some underperforming servicing company that just lost a huge contract.
Let's just look at the financial crisis from 2008, all the fraud, mismanagement, downright criminality with serious consequences for the companies involved has seen little to no shareholder activism. No executives or CEOs have been held accountable for their behavior or called to action by shareholders inspite of taking huge hits on their holdings.
The agency problem, 'short termism' and extravagant compensation and golden parachutes has also seen little action from shareholder activism.
Yet when it comes to anti-social behavior in regard to customers, employees and wider society 'shareholder interests' is rolled out on cue as some 'central plank of capitalism' when it barely works. It's become self serving and meaningless.
Because that's the default rule when it comes to arm's-length transactions in the economy? Unless there is a special relationship (e.g. doctor-patient), everyone takes care of their end of the transaction. The government offers very generous loan repayment options for student borrowers. It's Navient's job to collect payments, which helps keep the whole system solvent and lowers interest rates for other borrowers. Why should it be its job to help borrowers figure out their repayment options?
I don't see how this should be any different from the relationship a fiduciary has with his/her client.
Can we make this happen?
Are you suggesting that when people signed for the loan - which was not with Navient, as they're on the servicing and collections side - that they didn't know what the terms of repayment would be?
If someone doesn't take the time to understand their student loans, which are one of the most important things in their lives at that age, I just don't know what to say.
I always look up the terms of any loans I take, including student loans, car loans, credit cards, etc. Honestly, is that too much to expect?
Whether the collections is outsourced or insourced, your average student borrower isn't planning on having their life's trajectory fall apart. They aren't expecting the hardships that lead them to need remediation. However many warnings you provide them on the front end, it's at the time of crisis that they need advice and guidance. Navient has been horribly negligent and predatory in this regard. Anyone taking on the job of preferred collector of gov't loans should be required to act in the interests of the borrowers - aka the American public.
Navient should pay what the court compels it to if outright deception is found, but let's not overstate their role in the general problem around the structural non-sustainability of federal education loans, and the short-sightedness executive decision to spin off the liabilities into private hands.
Let's say an honest lending start-up rushes to fill this niche and then rejects people's applications based on imperfect academic record, lack of summer jobs or internships (so potential laziness), subpar math skills and very minimal knowledge of foreign languages (so indicative of poor information retention). It also honestly tells you that art history majors have no place in a business world, and honestly maybe a career in plumbing is a better fit.
This is just based on their model, and the rejection is worded in a nice, legally safe and sound, way.
How long before such lender is being sued into oblivion for discriminatory practices?
However, looks like such practices are not considered discriminatory by law.
> Two federal laws, the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA), offer protections against discrimination. The ECOA forbids credit discrimination on the basis of race, color, religion, national origin, sex, marital status, age, or whether you receive income from a public assistance program.
"Let people know what they're getting into." was intended to refer to the whole loan process, but specifically (in Navient's case) to the remediation options they present, and how they present them. That could include things like: 1) Guiding borrowers towards income-based repayment rather than deferment or forbearance, and 2) Recommending external options such as re-financing or consolidation where possible and advantageous.
Because their customer who is paying them to service the loans wants them to.
From what I understand, I don't think that the US government is generous at all with their student borrowers. Yes, they allow more flexibility around repayment options than do many other lenders. However, the government has largely eliminated the option of personal bankruptcy [1] for student loans. So, they're really just as complicit in this mess as the for-profit colleges and the loan collection agencies.
[1] http://www.nolo.com/legal-encyclopedia/student-loan-debt-ban...
Thinking of them less like "companies" and more like "parasites" starts to make a whole lot more sense. And it is hard to be angry with a parasite--it is in its nature.
If they're not selling the service _to you_, you're not a customer. You're at best a consumer and at worst a resource.
I dunno, why wouldn't it be okay? I interact with a lot of companies on a day-to-day basis; big ones (Facebook, Google), small ones (the corner shop I bought an energy drink at on my way to work), and everything in between.
Offhand I'd say that none of them have a legal expectation to work in my best interest, nor would I have expected any of them to, nor do I believe a law requiring them to would be workable.
My interest in buying an energy drink is to get the brand I wanted at the lowest possible price; the store's interest is in selling it to me at the highest possible price. If they had to work in my best interests would they be required to sell it to me at cost? Maybe I drink too many energy drinks, would they be required on pain of criminal sanctions to try and talk me into buying some fruit juice instead? The mind boggles. :)
Or do you think there's something special about this particular product that makes it different than every other good or service in the economy? Or that their very vague ads somehow set up a special relationship that's more akin to a doctor/patient relationship than the borrower/lender relationship one would expect from, you know, a loan company?
But we don't have any laws or expectation that a food vendor is going to be acting in my best interests. If I want to spend my rent money on 87 large pepperoni pizzas, nobody is going to arrest the guy who took my order because he didn't sit down and have a 30 minute session with me to ensure that my order was in my best interests, fit within my budget, and would improve my life. All we do is make sure that I 1) have the money 2) get my pizzas and 3) they aren't poisonous or mislabelled.
The difference between "you can't blatantly lie" and "you have a fiduciary duty to act in your client's best interests" is enormous.
If Navient wrote "call us and we'll screw you" then that would be fine as the customer would get what exactly what they were promised.
> However the pizza restaurant also doesn't have anything about helping you make good, long-term financial decisions plastered all over it's website.
They are a servicer, not a lender -- they are contracted by the lender to collect the money from the borrower. So the borrowers never asked to be customers of Navient. They borrowed some money from a bank or the government, who then contracted Navient to service the loans.
Now servicing loans is like owning an interest only bond -- you get a small payment every month as long as the loan is paying. When you own servicing rights, what you want to do is for payments to drag on for as long as possible -- since you don't get the principal, having the loan pay early is the second worst thing that can happen.
Now its very possible that Navient is doing things which are not in the interest of either the borrower or the lender, but are in the interest of Navient. And it's likely perfectly legal.
But again many of these loans are not just simple transactions in the marketplace, but rather subsidized social programs, where the government in promoting the program has a reasonable expectation that some part of this subsidy should fall to the borrower, and is reasonable frustrated when a provider whom they have hired tries to prevent this.
IF SO, that seems like a damning indictment of the government and the contracts they have drawn up then?
If you're trying to run some sort of soft touch social program where maximising the amount collected isn't your primary goal, then obvious the ONE thing you shouldn't do is then outsource managing it to a private company who gets paid based on their ability to maximise the account collected. Right? Given that's the one thing the government could do most likely to undermine their goals?
If you want happy borrowers, sign a contract with Navicent that pays them based on their NPS score. :)
Basically, people tend to think "false advertising" is fraudulent, even if that is not true from a legal perspective.
The difference is that we have drawn a line beyond which that company cannot operate by passing a law that bans certain practices, and the CFPB is alleging Navient violated that law.
Navient may well have such a duty. :)
If you advertise that you're going to help people deal with their debt better, then that should be legally binding (regardless of what your fine print says), and a failure to do so should at the very least be illegal under false advertising laws, and I'd say more reasonably it should be considered breach of (implied) contract.
(IANAL, so clearly my terms are not meant in a strict legal sense, because I have no idea what I'm talking about.)
For the same reason that it's always been expected from any company. Do you expect a local car dealer to act in your best interests if you show up as a result of a radio ad?
Caveat Emptor is in Latin for a reason - people have been living by the maxim for a really really long time.
I'd be willing to bet that played a role in the large number of those direct to consumer pre-orders and why Tesla is valued higher than Ford.
Presumably, they want the option to steer you towards their in house funds that have the highest fees instead of helping you het the max return on your investment.
i don't expect the $2 eggs company to care about any of the stuff that the $8 eggs company does. i just don't think that's realistic. i just assume they're fucking the chickens over, and the customer over, and themselves over, and that's going to continue as long as people buy $2 eggs -- which they will, forever, because people feel that tug at their stomach when they reach for the $8 ones. i feel it too, even with my techbrodude salary. difference is i buy it anyway, because of $many_reasons.
so i spend my money where i know the chickens aren't getting fucked over, what can i accomplish by worrying about the chickens? it's quicker to spend $8 and the world will be a better version of itself tomorrow (to me).
be the change you want to see in the world. expecting others to operate out of altruism is just not a practical thing to preach.
if i have children, i will advise them not to get college loans, and i will advise them to skip college if that means you need to. i will tell them not to do 10000 other things that are dangerous. that's what parenting is. expecting the world or companies not to try to harm you is insane and irresponsible, in my opinion.
So reject it already. Use cash. Spend only money you already have. Keep it simple; don't accept anything that comes with fine print. It's really not hard, you're just not used to saying "no" to it.
The world, as you function in it, is OK with how this works. Nobody is forcing you to comply.
The level of entitlement people have when borrowing money is insane. You're not borrowing from a family member that can be manipulated into forgiving you for being a freeloader who never pays back. Every single loan and line of credit is a serious matter - stop treating it like an externality where you get money now, completely pushing the eventuality of paying it back as "something that will magically happen". You need a plan to pay back debt. If you do not have an actionable plan to pay off debt, you have no business taking it on to begin with.
Why is debt considered "normal" in the 21st century? People are living beyond their means, trying to offload the blame on lenders, while the real fault lies entirely with the borrowers. Far too many people think that loans are just fake numbers on paper or a digital screen. No, loans are real money that you need to account for. Debt is not abstract concept that can be willed away.
Probably because it's extremely hard to get a university education or a house without it?
Especially educational debt; people are required to commit to it right at the beginning of adulthood and before they've learned the skills for the career that's supposed to be able to pay it back.
If you gave a rapist a week in jail, would that make him stop? If not, then why are we acting as if a $2 million fine is going to stop a company from doing further violations that help it make billions of dollars?
And all the settlements, which don't even ask the company to admit to any wrongdoing, are even more blood-boiling. It's almost like it pays to be on the side of corporations when you work for the government these days.
I would have benefited so much more from a program that taught how to be self-sufficient and the major, major benefits of living debt free.
Context: $150k in student loans - lucky enough to have an electrical engineering corporate job to (minimally) pay the bills.
EDIT: More Context: I went to an engineering focused private university, borrowed my way through the whole thing (housing, food, everything), parents didn't pay a dime. Stupid? Yes.
I read stories on Reddit about grads who have debt but are also making decent 5-6 figures and paying the student loan debt, but also also investing the stock market and buying a home, so it's not like they are in poverty or living paycheck to paycheck. The student loan debt can be manageable in many instances, especially if you major in a high-ROI subject.
"What we are buying" through 4 years of college seems to be getting less and less clear to me, and the administrators are very much involved in keeping things as difficult to measure as possible.
The average is massively skewed by the top few percentage of all borrowers that have taken on almost unfathomable loans.
Graph: https://i.imgur.com/Udj3leD.png
Sources from: https://nces.ed.gov/programs/digest/d15/tables/dt15_330.10.a...
https://nces.ed.gov/programs/digest/d15/tables/dt15_105.20.a...
Note* 2015 students were estimated and slope is from linear fit.
Stupid? Yes.
But that's reality for a lot of people. I'm shocked those averages are that low.
The school has a good internship/co-op program, so I was fortunate to step into a junior engineering role right after graduation. I'm a C+/B- student. Graduated with a 2.98 GPA.
The traditional education system has led many astray without providing successful alternatives.
You can easily make what an average lead developer makes if you pursue a career in the industrial operations industry (power plant operator, bulk electric system operator, etc.)
To draw any conclusion off this, you'd need to compare people who were considering college but do not attend versus those who were considering college but did attend - even if they didn't graduate. Only then do you have a metric that you can use to represent the ROI of attending college.
I've been working on the side to learn web development for the past year and a half, and I have only now been reaching out to job applications that I qualify for.
I at least want to pick up some higher paying part-time hours.
I plan on using the debt snowball to get out of debt faster and live within my means. If I follow that, the maximum time I will be in debt is 10 years, and that's with no income increase or extra income on the side.
I want to cut it down to 5 years or less.
Just trying to build skills and find ways to use them for profit!
You make me want to have more concrete plans for getting out of debt. Best of luck.
One of the big problems is structural changes in the legal business. It used to be if you didn't have a very marketable undergraduate degree you would go to law school. But discovery work that used to be the bread and butter of newly minted lawyers is now being done by computers.
None of that really matters. The big ROI is just getting a degree or the type of degree. There are few elite schools that have a much better ROI but they tend to be very generous with financial aid anyway.
Also, community colleges are a great resource. As long as community colleges exist, we shouldn't even allow student loans for the freshman and junior year. You can do your first two years while working part time to pay the very minor tuition. Then you can transfer to another school. Every flagship state school takes tons of transfers. My buddy transferred from a podunk community college to Stanford.
And when you transfer you should go to a cheap school. Unless you get a great college scholarship, it should be your state's flaghship public school.
Nortwestern is a great school, but not 150k better than UIUC (and for engineering its not better period). If you get a nice financial aid award, great, but otherwise don't go. My college counselor in high school was telling people to pay full price for DePaul instead of UIUC just because they wanted a "city experience." No, that's not worth it.
It's conceivable that I'd have had a better job right out of college, especially given the network effects of the big-name schools, but I got an excellent education. Of course, my job prospects were helped by grad school (UC Berkeley), but by that time I knew very well what I wanted to Be When I Grew Up, so the investment was worth it (and ended up being very small, as I managed to live cheaply (it was the early 2000s) and swing a grad assistantship most of the time. On top of all that, the stuff I'm doing means I have to keep learning all the time, so the actual stuff I learned as an undergrad and in grad school was far less important than the habits of mind I acquired there that made me a good learner.
Bargain hunting for an education is really important. I've met lots and lots of people since graduating, some were amazing at their jobs and could get work anywhere and some were ... not. That didn't seem to correlate much with alma mater.
So yeah: a college degree can be great, but you don't need to go to a small elite private school to hone your analytical, technical, communication, and creative skills. It's way more about making use of what's available.
But in general yes, it's a good idea to shop around. It also depends on the field you want. CSU Northridge is a pretty marginal school, but it's great at geology.
For law, I'd say get a scholarship or aid at a great school or don't go at all.
In many ways grad school is an outlier in general. It's often just not worth it to get a PhD from a less respected institution. The difference is that most PhD programs pay you, not nice versa.
I think my lackluster grades in High School were actually a blessing in disguise. I attended Rockland Community College (as no one would accept me anywhere else) and received an A.A.S. in Cyber Security with a very high GPA. Due to my performance at my CC I received a great academic scholarship to Rochester Institute of Technology.
I graduated RIT with just more than $15k in loans.
I'm glad it went the way it did. But, coming out of HS the stigma of CC was palpable, and it shouldn't be - the education at my CC was surprisingly good. Many of my peers who graduated with me at RIT, and those who graduated with me in HS but went straight to private well renowned schools, are in 10x more debt than me.
Luckily I'm the oldest off all my cousins, and will be drilling this into them when they start looking at schools.
$100k would put you in the top 5% of individuals. $200k would put you in the top 3% of households.
My advice to people today, is go to the cheapest school you can, local community college is probably the best option, unless you're going to a top tier school, and have plenty of funding for it without student loans.
Over 40% of people with US Government-sponsored student loans--which were presumably taken out in order to advance the career prospects of the borrower--are not being paid sufficiently to repay their loans on the basis of their original issuance, _and this is presented as a good thing_.
Unbelievable.
Navient is a debt collector. They were sold loans owned by the US Dept of Ed (or hired by the department of ed maybe?)
"more than 40 percent of loan balances it services...." means that out of the loans that the US Dept of Ed decided it can't collect on anymore -- many of those are using the option that would benefit them the most.
The article talks about Navient saying one thing: "we want to help all of the borrowers because they are actually not just borrowers but citizen/constituents"; while doing another: "thanks for calling Navient, having trouble paying your loan? Just hit the loan-pause-button and we will pause your loan for 24 months. No, we will not tell you this but you could have asked for the 'smaller loan payments because you're not earning much' button'."
Nope - Navient isn't a collector, it's a servicing company.
I never choose to make any financial deal with that company and I never would have given any choice. The net result was just that I made it my absolute top priority to pay off the rest of my loans held by them (which was also a very frustrating process, with several rounds of extra interest and surprise tiny fees and more inability to get someone on the phone) but other people wouldn't have that luxury.
Navient had a federal contract with the Dept of Ed and the Dept of Treasury to collect on their behalf.
Full disclosure: Navient is a client of my employer and I work with them directly.
I personally think public universities should be free and highly selective, rather than the opposite. But I also think taking out loans with no plan to repay them is criminally stupid. If the education product being sold is fraudulent, go after the fraudulent institution (as has been done). But the bank? They're just a bank. And no, I don't think it's good that we have banks financing student debt, but I sure as hell don't blame banks for doing it.
This is a fabulous example of why privatizing what should be a public service is a terrible idea, yes, and this is the ridiculous game we get to play as a result... blaming the bank for playing hardball over money. Really?
Do you not remember 2008?
The core of the issue is still the university tuition rates, and universities involved are usually not privatized. These public institutions have become profit centers, benefiting from the captive audience of young career seekers, and cranking up administration overhead costs in their budgets to absorb the increased amounts of loan money available to prospective students.
Loans are always hardball business, and student loans are no different (although this case is clearly false advertising). The fact that the government sought to get more university degrees into the hands of citizens by increasing loan availability and size is the short-sighted idiocy that helped bootstrap this mess.
My solution: student loans may be discharged in bankruptcy, but your school records are discharged too. Thus if you get an expensive degree that won't pay off the loan just give up the degree and credits. Doctors will not do this because their pay.
Note that loan companies now have incentive to ensure you graduate and get a job. Getting Ds in a few classes: they will cut you off now rather than try to see if you can turn it around. Maybe you can find the money to pay for your next semester one your own and improve your grade, and if you do this long enough they might change their mind and give you loans to finish.
The only angle I'm still working out is if someone finishes a degree, declares bankruptcy, and then goes back to the same degree (elsewhere) - they don't have the credits but they presumably know the material and can easily pass all the classes the second time around with a better grade.
- If they encourage a path via low-rate loans in a field that tanks
- If they prevent a path via high-rate loan that turns out to be much more lucrative than the one they encouraged.
Obviously the impossibility of defaulting and the ease of getting loans feeds the problem, but what you are proposing would destroy the system rather than fix it.
Is that a problem, though? Presumably they still have to pay for the degree the second time around. And if they don't (say, a free community college), then sure, they're getting something "easier", but they still have to spend the time to get it, and they're getting a degree from a low-ranked college vs. the (for example) elite university they went through the first time.
All roads lead to money in politics allowing them to do whatever they want and not have repercussions.
If we want student loan servicer behavior to change, we need to legislate it. Just like we did (or didn't, depending on your point of view) for mortgage servicers.
That said, Navient is in the business of collecting on debts, and they have every right to do so within the bounds of the law. They don't owe borrowers anything.
I don't personally expect Navient to do anything better than follow the law; I don't expect any help or counseling from them. In fact, I'd be suspect of any such counsellings.
https://studentaid.ed.gov/sa/repay-loans/disputes/prepare/co...
then a navient person in that department reached out to me almost immediately.
Edit:
You can also file complaints for general consumer financial help here:
This is literally how costs go up. "OMG we need this, damn the costs" "OMG why does everything cost so much, why is the debt so high?"
Also debatable as to whether you had those rights in the first place (see: this thread)
In my analysis, this risk/reward analysis matters most for debters considering marriage.
[0]: https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancell...
On the other hand, if you need IBR, or some of the other protections offered by federal loans, you are taking a risk by refinancing. You'll lose those protections, and you might need them in the future. If you are pursuing one of the public service loan forgiveness programs, you probably need to keep the federal loans.
I refinanced with Commonbond, a Sofi competitor, a few years ago. My loan balance was fairly low compared to my income, I would never qualify for income-based repayment, and my federal loan rate was something like 6.8%. I refinanced my 10-year loan to a 5-year loan with a low interest rate. My situation was ideal for this. However, if your loan balance is more than your annual salary, or you need to rely on the federal loan protections for some other reason, you shouldn't do it.
On the other hand, there seems to be no downside to refinancing private student loans.
IMHO the schools are the bad guys here.. they are taking advantage of a situation where the government will just hand loans to everyone and there is no way they can lose. Why not just make an undergraduate degree a public good at this point. Taxpayers are already paying to bail all these people out, it is partially a public good already except the students who hold all the debt have to go through hell and Navient gets a cut of the taxpayer money in the process.
According to the article, Navient is a private company, So shouldn't they have an expectation of return on Investment. This is not the U.S. government, which may Forgive debt.
Another point is why the hunger for expensive education, Which may be a Marxist critique, but since when did A credential make you a better software designer.
People are dying all over the globe, and we are worried About the top 20 percent wage earners of the superpower USA.
The CFPB is young and they might have bat higher than they should have.
Take a page out of the SEC playback and settle for kickbacks.