Warren Asks Student Loan Servicer Maximus to Ensure Smooth Transition for Borrowers From Navient
By Owen Daugherty, NASFAA Staff Reporter
Sen. Elizabeth Warren (D-Mass.) along with four other Democratic senators asked Maxiumus, the student loan servicer tasked with taking over the accounts of more than 5 million borrowers transferring from Navient, to ensure those borrowers have a smooth transition. In a letter to Maximus this week, the lawmakers said it is critical that the servicer “perform at a high bar and with increased transparency to provide the best possible service to borrowers.”
Navient announced in September that it would be ending its contract with the federal government and transfer all borrowers it is responsible for to a new servicer. Maximus, which operates as a student loan servicer under the name Aidvantage, was later identified as the servicer that would be taking over Navient’s accounts, and Navient later agreed to continue on as a servicer through December in an attempt to facilitate a smooth transition.
The letter states that Maximus, which currently services the loans of over 1.7 million borrowers in default, has a troubling track record that "raises concerns that borrowers may be subject to poor service and abusive practices."
“As Maximus takes on the responsibility of managing the loans of millions of more borrowers and managing pre-default loans for the first time, it must meet a higher bar of accountability and demonstrate its commitment to working in service of borrowers,” the lawmakers note.
The lawmakers are requesting answers to a series of questions by no later than December 8, calling on Maximus to detail its plan for providing quality service to borrowers, including the servicer’s staffing plan to handle the influx of borrowers, how Maximus plans to retain borrower records and documents from Navient, and its plan to avoid errors during the servicing transition.
A spokesperson for Maximus told NASFAA the company appreciates the confidence the Department of Education (ED) has placed in it to take on these borrowers' accounts and looks forward to meeting ED's performance standards.
"We will ensure the transition from Navient to Maximus is as seamless as possible, and that student borrowers are supported every step of the way as we help them manage the repayment of their student loans," the spokesperson added. "This is a defining moment for student borrowers, and we couldn’t agree more with Senator Warren — it is imperative we get it right. We will respond to her great questions and ensure that she and her staff share [ED's] confidence in us as the servicing of these student loans transitions from Navient to Maximus."
Publication Date: 11/24/2021
You must be logged in to comment on this page.