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?
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.
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?
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.
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...
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?