Feds sue student loan servicer Navient

Discussion in 'Business & Economics' started by Kittamaru, Jan 18, 2017.

  1. Kittamaru Now nearly 40 pounds lighter. Staff Member

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    CFPB charges the ex-Sallie Mae unit failed borrowers at every stage of the process

    https://www.consumeraffairs.com/news/feds-sue-student-loan-servicer-navient-011817.html

    All I can say is... it's about damn time. I just hope it sticks with Trump taking office. As someone who has loans with Navient, not ONCE has the payment information I get from the website, their automated phone system, or a call center rep matched up with each other OR what my actual payment is according to the IDR plan I'm on. I really don't know how a servicer can suck so badly and still remain a servicer...
     
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  3. joepistole Deacon Blues Valued Senior Member

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    Careful you are going up against a deeply held Republican core belief that the private sector is always better than government. It's a deeply held core right wing belief.

    In truth there is nothing magical about the private sector. Right wingers just haven't figured that out yet, and sadly they may never figure it out. There are many examples of how privitization failed. You don't have to look far to find them. http://www.governing.com/topics/hea...d-medicaid-companies-in-kansas-lost-170m.html
     
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  5. Kittamaru Now nearly 40 pounds lighter. Staff Member

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    Aye... I get the idea that competition breeds better services/products... but there has to BE competition for that to happen. If the companies segment areas and mutually agree not to intrude on each others territory (such as what ISP's in America seem to do) then there's no competition, and it's the equivalent of a monopoly, just with more than one player...

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  7. joepistole Deacon Blues Valued Senior Member

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    There are a number of companies out there who do this kind of thing. So there is competition, but it takes more than that. It also takes good management and adequate funding, the privatization of KanCare is an case in point. The program was underfunded based on an expectation of improved efficiency which never materialized and was inadequately supervised. There were no controls and no metrics. The lack of adequate funding and controls would be problematic in private industry as well as in government.

    Now once a contract like this has been implemented, it's not easy to back out of without significant disruptions, and that's another problem. We cannot just throw these programs over the fence to private industry and expect magic to happen. But that's what has happened, and I think we all know how right wingers feel about government oversight.

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    They don't care for it unless a Democrat is being investigated.

    Given the difficulty in changing vendors if the vendor fails to perform, it doesn't make sense to farm out some government functions. If you cannot change vendors easily, then you don't have sufficient competition.
     
    Last edited: Jan 18, 2017
  8. Syne Sine qua non Valued Senior Member

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    There is no free market competition once the government has put its thumb on the scale by providing loans that divorce the consumer demand from supply price. This particular private sector would not exist to this extent without the government money as incentive.
     
  9. Kittamaru Now nearly 40 pounds lighter. Staff Member

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    Indeed... and it makes this whole "Federal Single-Servicer" thing they are trying to do all the more weird. They want to go from four(ish) major servicers... to a single (total) servicer for all Federal loans. I cannot see that ending well

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