Two state lawsuits against Navient — which split off from Sallie Mae in 2014 and retained most of the company’s loan portfolio — accuse the company of flouting traditional underwriting standards and making billions of dollars in risky, subprime student loans to borrowers who have little hope of repaying them.
For the students who took out those loans, the debt can be a burden that weighs them down for decades. Here are some of their stories.
Humberto Tapia, 28
Owes Navient around $35,000 on 27 separate loans
Attended ITT Educational Services, a for-profit technical school chain that closed last year, from 2009 to 2012; earned an associate degree in computer networks systems.
Looking for I.T. support work in Sacramento.
“The marketing at ITT pushed that they would help you find jobs right away, and they talked about the salary range you should expect. It turned out to be the opposite: You end up with more loans and interest than the amount of money that you are making. I would have been better off getting study materials and just taking some certification tests. I’m working now on a Cisco certification.
“Most of my field is contract work. I have to go out and get health insurance on my own, and I lost my job three times when temporary contracts ended. I’m always behind; I lost my car because I couldn’t pay. I purchased a small scooter instead. That’s how I get to work.
“ITT was able to file for bankruptcy, but the students can’t do that — we’re stuck with the loans. I’ve stopped paying on most of them. My view is, if I die, who is going to pay for the loans? I’m not married. I’m not tied to anyone. There’s nothing they can do.”
Rebecca Russell, 36
‘The loans keep getting bigger’
Borrowed $56,000; now owes $83,300
Attended Northwest Florida State College from 2004 to 2007 and the University of West Florida from 2008 to 2011; earned a B.A. in maritime history.
Artist and seasonal tourism worker in Destin, Fla.
“I live in a very tourism-based area where the jobs are all seasonal. I got my diploma and then immediately had no job and nowhere to live. Paying back my loans was not even an option. Two of them went straight into default. Every once in a while, around tax time, I’ll get a call from a collector saying, ‘Hey, we’ll settle,’ but I have no idea if it’s legitimate. I just ignore those two loans.
“I’ve been paying on my federal loans through an income-based program. It’s hell to redo it every year, but it works. With interest, the loans keep getting bigger, but they’re in repayment. I pay $140 a month.
“Every year, I battle with Navient on my private loans. I say, ‘I can’t afford to pay this, I need a payment reduction,’ and they push me toward forbearance. I just did this recently. My interest rate went up — no warning, no explanation — and when I called, the representative said there was nothing she could do.
“I said, ‘I know there’s some kind of lawsuit going on,’ and she cut me off and sent me to a rate-reduction department. They took my information and got my payment down to $88. But it took 30 minutes of arguing.”
Nick Newton, 34
‘The biggest mistake of my life’
Borrowed $62,000; now owes $121,000
Attended ITT from 2004 to 2009; earned a B.A. in computer science.
I.T. Specialist in New London, Wis.
“When I graduated from ITT, my payments were not manageable, and I was never offered income-based repayments. They offered me deferment, and so I used up all the deferment that was available. In the meantime, the interest was collecting and getting capitalized. I paid sporadically, when I could, but the bill was $800 or more each month. It was a huge burden.
“Last year, I finally got on an income-based plan. Now I pay $450. I have a good career, and I can afford the payment — but when you log on to Navient and see that you owe $121,000, it’s hard to look at. That’s nearly a house in this area.
“I have a family now; I got married Christmas Day last year, and we just had our first kid, a son. My wife is in the same position with student loans. Combined, we owe about $200,000. You keep throwing money at it every month, and the balance doesn’t go down. College would end up being the biggest mistake of my life.”
Ashley Hardin, 33
‘I had no idea what I was doing’
Borrowed $150,000; now owes $149,000
Attended the Brooks Institute of graphy from 2006 to 2009; earned a B.A. in professional photography.
Restaurant server in Seattle.
“I graduated from the University of Nevada, Las Vegas, in 2006 with a B.A. in advertising and absolutely no debt. I wasn’t ready to start my career, so I decided to get a photography degree.
“I had no idea what I was doing, financially. I was young, and I didn’t know what it meant to take out big loans. I assumed I would get a job and be able to pay it back. The school never had any kind of serious conversation with the students about it.
“The only thing they did was, right before we graduated, all the people with loans had a class where they showed us a piece of paper with loan amounts and the monthly payments on them. The highest they had listed was $90,000. I said: ‘Wait, what? We all owe more than this.’
“I couldn’t make enough money as a photographer. It’s all freelance, and smaller jobs here and there. I kept paying on my loans, but I was totally broke. At one point, I moved in with my boyfriend’s parents to save money.
“I was on an income-based repayment plan at one point, but you have to sign back up every year. I’m not on any kind of reduction plan right now. I pay $1,395 a month. I feel like I got a pointless degree — there’s just no job market for it. I’m going to be paying on this for the next 20 years or longer.”
Victoria Linssen, 52
‘It’s all low-paid gig work’
Borrowed $117,000; now owes $132,000
Attended the Brooks Institute of graphy from 2010 to 2012; earned a B.S. in visual journalism.
Digital marketer in Phoenix.
“I had a very successful career in digital advertising, but I needed something less stressful. I decided to leave corporate America and study photography.
“I signed an enrollment agreement at Brooks in 2010, and almost immediately, I started to get cold feet. I heard about the lawsuit filed against them in 2005 over exaggerated job placement statistics. I had a lot of conversations with officials at the school about that, and they convinced me to attend. They promised custom job placement assistance.
“What they actually did was just send us stuff from public job boards — postings we could find ourselves. I found out that there’s virtually no full-time jobs out there in photography. It’s all low-paid gig work.
“I tried really, really hard to make a career in photography. I wrote to 220 production companies trying to find work, and I did a ton of one-off small jobs. It was the best and worst time of my life: I got to work on very cool projects, but I was the poorest I’ve ever been. I went from running a division at an advertising agency to standing in line at food banks.
“I had to go back to work in my previous field, marketing. It was the only way I could make a living. I owe $132,000 for this degree that is basically worthless. After Brooks went out of business, I filed a borrower defense to repayment application. I’m still waiting to hear on it. If it gets accepted, that would discharge my federal loans, but it won’t help with the $78,000 I owe Navient on my private loans. I’ve paid more than $16,000 on those since I graduated, but the balance has not gone down.”