Service members to receive $60 million in student loan refunds

Back in May of 2014, the Department of Justice (DOJ) reached a settlement with Navient Corp., a student loan servicer that was formerly a part of Sallie Mae. Navient had been accused of violating the Servicemembers Civil Relief Act (SCRA) by charging active duty service men and women excessive fees and interest charges on education loans (both private and federal). The settlement allowed Navient and Sallie Mae to end the investigation without having to admit to any wrongdoing.

Now, a year later, the DOJ has finally announced details on the settlement’s payout. On June 12, checks will be sent to 77,795 service members. The checks will range from as little as $10 to over $100,000, depending on how much the individual service member was overcharged, based on the documentation provided by the service member.

Beyond the refunds, Navient was also required to pay the United States a civil penalty in the amount of $55,000. Additionally, Navient was instructed to clear any negative credit reporting that may have resulted from overcharges or improper default judgments.

The accompanying press release quotes Acting Associate Attorney General Stuart F. Delery as saying, “This compensation will provide much deserved financial relief to the nearly 78,000 men and women who were forced to pay more for their student loans than is required under the Servicemembers Civil Relief Act. The Department of Justice will continue using every tool at our disposal to protect the men and women who serve in the Armed Forces from unjust actions and illegal burdens.”

If you are a service member and have questions about your eligibility to receive monetary compensation as part of the settlement, you can call 855.382.6421. If you believe that your SCRA rights have been violated, please contact your regional Armed Forces Legal Assistance office.

Jesse Campbell photo.

Jesse Campbell is the Content Manager at MMI, with over ten years of experience creating valuable educational materials that help families through everyday and extraordinary financial challenges.

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