BOSTON (AP) – Navient, a major student loan servicing company, has settled allegations of predatory lending practices for $1.85 billion.
The settlement was announced Thursday and could cancel student loans of tens of thousands of borrowers.
The settlement includes $1.7 billion in debt cancellation and $95 million in restitution and involves 39 state attorneys general.
Pennsylvania Attorney General Josh Shapiro says the settlement would resolve claims that Navient led student borrowers into long-term forbearances instead of giving them advice on less costly repayment plans.
Navient says it did not act illegally and it did not admit fault in the settlement.
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