Federal Judge Allows Suit To Proceed Against Student Loan Servicer

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HARRISBURG, Pa. (AP) - A federal judge in Pennsylvania has ruled that a lawsuit alleging widespread abuse by student loan servicer Navient Corp. can go forward.

Navient is one of the nation's largest student loan servicers. It had filed a motion to dismiss the majority of the counts in the lawsuit. It had claimed federal laws prohibit states from filing claims when a federal consumer protection lawsuit is pending regarding the same conduct.

Among the state's claims is that Navient steered borrowers into repayment options that were not in their best interests.

A judge ruled Monday to let the suit proceed. Navient is facing similar lawsuits in at least four other states.

Pennsylvania's attorney general's office says the average debt for new graduates with student loans in the state is about $37,000, the second highest in the country.

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