Navient Made It Hard For Me To Pay My Loans Back

One person’s tale

Photo: Pixabay

In 2014, I was finally committed and financially able to make significant inroads into my $72,000 in student loan debt. In addition to the $686 monthly payments, I wanted to throw extra money at my debt each pay check. Navient, in a series of evasive maneuvers worthy of a Victorian maiden, resisted my every attempt. After having pursued my payments for so long, I was shocked when it did everything it could not to take my money.

Navient’s first move was to take the extra electronic payment I was trying to make and apply it towards my next monthly bill. So, I would pay $1,000, paying off the current month and Navient would reduce the next month’s bill by $314. Yet, given that I was accumulating $3 in interest every day, I wanted the money to be applied the day I sent it and against those loans that were highest interest and highest dollar value.

How would I achieve this goal? I had no idea. Combing through the Navient FAQ, the closest thing I could find were directions to send a letter with a check outlining where I wanted the money applied and in what order. I started to panic, thinking of all the extra interest that would accrue before a hard copy letter and check were opened, read and processed.

I interpreted the term “mail” broadly and started sending a customer service email each time I made an extra online payment. Every two weeks, I transferred money from my bank and went into my Navient account and sent an email outlining what to do with the money. Then I logged back in every other day to see if the initial payment was reversed, the money reapplied and all account calculations rolled back to the date of payment. Many times, I also had call Navient to get the monies reallocated properly.

Why did Navient put such barriers in my way? Having run the numbers in a spreadsheet, I could see that their default payment application for extra money was aimed at keeping their clients for as long as possible. An average borrower would have multiple loans and might have different interest rates, like I did. Navient’s default was to take any extra money and to spread it across all loans, paying toward interest first. This greatly reduced the impact of my extra payments and would keep me paying longer and at a higher cost.

In the months that Navient forced me into this infuriating dance, they briefly opened a window to payment sanity. One day, their online payment portal had a drop down option which asked where you wanted the extra payment applied. I couldn’t believe what I was seeing, but by the time I went in to make a payment, the chimerical drop down was gone.

I did maintain hope for months that I was seeing a beta test of a new option. In the meantime, each extra payment required considerable effort on my part so that the money I was paying would go as far as possible. I didn’t feel like I was gaming the system, just watching my out for my financial interests. It paid off, too. In a year and a half, I had paid off a quarter of my starting debt.

Yet, Navient seemed uninterested in helping me maximize my repayment efforts. The death blow was another payment system change which made my extra money workaround impossible. No longer did I have a viable online option to get around accruing interest and paying down principal. Instead, any extra money would simply count against the next month’s payments unless I sent a letter telling them otherwise.

At that point, I knew I had to pursue another option for repayment. Swallowing all my pride and my commitment to financial self-sufficiency, I set an appointment with my husband, took him to dinner at a bar and made a financial proposition. I laid out what I owed and how long Navient would have me paying. I asked him to pay off the $55,000 balance and promised that I would make payments toward the sum each pay check. Thankfully he was able to do so and agreed to the arrangement.

I am happy to say that I am burning through the repayment without interest. Yet, I know from reading the news that I am not the only one who was trapped and hurt by the Navient game. Reading the reports about the lawsuits against Navient from the state attorneys general in Washington and Illinois, extra payment allocation was one of the seven issues cited.

While some of the Navient practices veer closer to fraud — such as offering deferments when other payment options were more advantageous — the venal and workaday payment allocation was also a trap for borrowers trying to get ahead. I am lucky that I had an out. I hope class action lawsuits will help other borrowers make up for precious lost ground in their repayment efforts.

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