In the United States, more than 44 million borrowers owe $1.4 trillion in student loan debt, according to the Federal Reserve. In 2016, the average graduate held a little more than $37,000 in student debt, a six percent increase from 2015.

There’s a premium on higher education in this country, but easy credit, rising tuition costs, and aggressive lending is making it increasingly difficult for students and grads to pay off their debt.

Now, consumer watchdogs are looking for accountability. Lawsuits filed by the attorneys general of Illinois and Washington State, and the Consumer Financial Protection Bureau (CFPB), are accusing Navient — the largest student loan provider in the country — of pushing borrowers into inadvisable borrowing practices and profiting off of private loans that were “designed to fail.”

The CFPB complaint alleges that employees were encouraged to push borrowers to postpone payments through forbearance. Illinois and Washington are charging that Navient’s predecessor, Sallie Mae, made private subprime loans to borrowers even though the company knew that these individuals would be likely to default. In some cases, the loans were expected to default at rates as high as 92 percent.

Betsy Mayotte, director of consumer outreach and compliance at the non-profit group American Student Assistance, examines the allegations facing Navient.

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Navient has denied all wrongdoing and issued the following statement to The Takeaway:

“Student loans provide access to higher education for millions of Americans. For the vast majority of student loan borrowers, the investment they make is a good one as their education creates new career opportunities with higher earnings.

“Unlike other consumer loans, student loans are made based on the borrower’s prospective ability to repay. This means one expects the borrower’s education will lead to new job opportunities with higher wages. Because students are generally not working when they borrow and have little to no credit experience, virtually no borrower would be classified as a prime credit.

“We understand that there are some for whom the investment did not pay off as hoped. We encourage all customers who are struggling to reach out to us, so we can help them understand their options and they can make an informed choice about what’s best for them.

“Our servicing practices are designed to help our customers find the right repayment program to fit their budget. As a result:

• Federal student loan borrowers we service are less likely to be delinquent and are 31 percent less likely to default.
• 49 percent of loan balances we service for the government are enrolled in income-driven repayment.
• 9 times out of 10, when we can reach federal loan borrowers who are struggling with repayment, we help them find a solution that keeps them out of default.
• The vast majority of our private education loan customers are successfully repaying their loans, and delinquency and default rates are among historic lows.
• In 2009, we created a private education loan modification program to support borrowers who needed a more affordable payment.”