WILMINGTON, Del. — The Delaware-based student loan company Navient is facing a shareholder lawsuit over its declining value.
The News Journal in Wilmington reported Monday that some shareholders claim the company withheld information about its subprime student loans. Such loans carry more risk because borrowers have lower credit ratings.
The company’s value fell by more than $500 million after it was sued by Pennsylvania’s Attorney General in October. The AG claims Navient harmed borrowers by peddling loans that were likely to default.
Navient has rebuked those claims and said it will vigorously defend its record in court. Navient has said its student loan borrowers are 37 percent less likely to default than those working with other loan servicers.
The company employs about 800 people at its Wilmington headquarters.
Information from: The News Journal of Wilmington, Del., http://www.delawareonline.com