No, most remain active; the 2022 settlement only cancelled specific private subprime loans that were delinquent for seven months before mid-2021.
Headlines regarding student loan cancellations often create more confusion than clarity. You might see news about billions in discharged debt and wonder why your balance remains unchanged. The confusion stems from the fact that relief efforts target specific groups rather than offering a blanket wipeout for every borrower.
Understanding who qualifies for relief requires looking at the specific lawsuits involved. The major multi-state settlement focused on private loans, while separate federal actions targeted borrowers misled by for-profit schools. Each program has strict dates, location requirements, and account status rules that you must meet.
We will break down exactly which debts vanished, which ones remain, and what steps you can take if you are still paying off a balance that you believe should be gone.
The Reality Of The 2022 Multi-State Settlement
In January 2022, a coalition of 39 state attorneys general announced a massive settlement with Navient. This agreement resolved allegations that the servicer steered borrowers into costly long-term forbearances instead of affordable income-driven repayment plans. The deal included $1.7 billion in debt cancellation.
However, this huge number leads many people to ask: are all Navient loans forgiven under this deal? The answer is no. The criteria were incredibly narrow. The relief applied strictly to private student loans, not federal ones. Furthermore, these private loans had to be “subprime” loans made to students attending specific for-profit schools.
The timing of the default also mattered immensely. Borrowers had to be delinquent for at least seven consecutive months prior to June 30, 2021. If you were current on your payments during that window, you likely did not qualify for this specific cancellation event.
Eligibility Criteria For Private Loan Relief
Determining your status requires checking several specific data points on your account history. This was an automatic process. Borrowers did not need to apply. If you qualified, Navient (or the consumer fund administrator) sent a notice. If you never received a notice, your loan likely fell outside the boundaries of the agreement.
The table below provides a deep look at the requirements. You must meet all applicable conditions to fit into the settlement class.
Table 1: Navient Private Loan Settlement Eligibility Rules
| Criteria Category | Requirement For Forgiveness | Disqualifying Factors |
|---|---|---|
| Loan Type | Private Education Loans only. | Federal Direct Loans, FFELP Loans. |
| School Type | Specific for-profit schools (e.g., ITT Tech, Art Institutes) listed in the lawsuit. | Public universities, community colleges, or private non-profit schools not on the list. |
| Origination Year | Loans originated roughly between 2002 and 2014. | Loans taken out recently or outside the specific subprime era. |
| Payment Status | Charged-off or delinquent for 7+ consecutive months prior to June 30, 2021. | Accounts that were current or paid ahead during the review period. |
| Borrower Residence | Must reside in one of the 39 participating states or D.C. (e.g., FL, CA, NY, PA). | Residents of non-participating states regarding this specific settlement action. |
| Mailing Address | On file with Navient as of the settlement calculation date. | No address on file (though funds are held in unclaimed property in some cases). |
| Restitution Check | Some federal borrowers received a check (~$260) but no loan cancellation. | Received full cancellation (these groups were mutually exclusive). |
Are All Navient Loans Forgiven Automatically?
Many borrowers assume that if a court rules against a lender, the debt simply evaporates. For the 2022 settlement, the process was indeed automatic. Navient notified eligible borrowers by July 2022. They adjusted credit reports to zero out the balances. If you log in today and see a balance, the settlement algorithm did not flag your account.
You cannot appeal this specific decision today because the settlement is closed. The attorneys general negotiated a defined class of victims. If your loans were federal, or if you had private loans but kept up with payments, you were not included in the $1.7 billion write-off. This creates frustration for responsible payers who struggled but managed to pay, only to see defaulted peers get relief.
Federal Loans And The Servicing Shift
A major source of confusion is the difference between who owns the loan and who collects the payments. Navient spent years servicing federal loans owned by the Department of Education. In late 2021, Navient ended its contract to service federal loans. These accounts moved to Aidvantage.
If you had a federal loan with Navient, it is now with Aidvantage (or potentially MOHELA or EdFinancial). These loans are subject to federal forgiveness programs, not the private loan lawsuit. You might qualify for Public Service Loan Forgiveness (PSLF) or Income-Driven Repayment (IDR) account adjustments.
The Federal Student Aid Borrower Defense program is the primary route for federal borrowers misled by schools. If you attended a school like ITT Tech or Corinthian Colleges, and you have federal loans (formerly serviced by Navient), you apply through the Department of Education, not the servicer.
Navient Loan Forgiveness Rules For Private Borrowers
Since the 2022 settlement is in the past, private loan borrowers need to look at current options. Private lenders rarely offer true forgiveness. They do not have the same legal authority or mandate that the federal government has to wipe away debt based on income or public service.
However, specific circumstances can lead to a discharge. Review your promissory note for a “death or disability” clause. Many older private loans did not discharge upon the death of the primary borrower or cosigner, but newer policies often do. If you have a Total and Permanent Disability (TPD), you must check if your specific private lender honors a discharge. This is standard for federal loans but varies wildly in the private market.
Another angle is the statute of limitations. Private student loans are considered written contracts. Each state sets a time limit on how long a creditor has to sue you for a debt. If you defaulted years ago and the statute of limitations expired, the debt is “time-barred.” They can still ask you to pay, but they cannot win a judgment in court if you raise this defense. This is not forgiveness, but it is a form of relief from legal collection.
The Sweet Vs. Cardona Class Action
While asking are all Navient loans forgiven, you may have missed the news about the Sweet v. Cardona case. This massive lawsuit against the Department of Education helps borrowers whose Borrower Defense applications were stalled or wrongfully denied.
This case lists over 150 schools where misconduct was rampant. If you attended one of these institutions and applied for Borrower Defense before June 22, 2022, you might be part of the “automatic relief group.” This results in a full discharge of federal loans, a refund of payments made, and deletion of the trade line from credit reports.
Navient (or Aidvantage) receives instructions from the Department of Education to process these discharges. They do not decide who gets them. If you are in the “decision group” (applied after the deadline), the government has a strict timeline to review your case or else they must grant the discharge.
School Misconduct Discharge Options
Private loans are harder to discharge based on school fraud, but it is possible. The “Holder Rule” allows consumers to assert claims against a lender that they would have against the seller of goods or services. In this context, if the school (seller) committed fraud, you might be able to stop paying the lender (Navient) who holds the loan.
This is legally complex. You often need to prove a formal relationship existed between the school and the lender. Since Navient had preferred lender arrangements with many for-profit schools, some borrowers have successfully negotiated discharges by proving the school and lender were working together to fund useless degrees.
Scams Targeting Confused Borrowers
Scammers exploit the confusion around the question “are all Navient loans forgiven?” They know you want a “yes.” They call or email claiming they can fast-track your settlement check or apply your loan to a new forgiveness program. They ask for an upfront fee or your FSA ID login credentials.
Legitimate relief is free. The 2022 settlement required no application. Federal Borrower Defense is free to file at StudentAid.gov. Never pay a third-party company to “file paperwork” for a discharge that you can file yourself for free. If someone demands payment to reduce your student debt, it is almost certainly a scam.
Table 2: Private Settlement Vs. Federal Discharge
This comparison highlights the differences between the closed 2022 private settlement and ongoing federal options.
| Feature | 2022 Navient Private Settlement | Federal Borrower Defense |
|---|---|---|
| Status | Closed / Expired. | Active / Ongoing Application. |
| Loan Types | Private Subprime Loans only. | Direct Federal Loans. |
| Application | Automatic (No application). | Must file form on StudentAid.gov. |
| Basis | Predatory lending/servicing. | School fraud/misconduct. |
| Refunds | Restitution checks sent (~$260). | Full refund of past payments possible. |
| Credit Report | Trade line deleted (forgiven loans). | Trade line deleted. |
Tax Implications Of Loan Cancellation
Historically, the IRS treated cancelled debt as taxable income. You would receive a Form 1099-C and owe tax on the “income” you never actually saw in your bank account. This was a massive “tax bomb” for borrowers.
Current rules are more favorable. Under the American Rescue Plan Act, student loan forgiveness granted between 2021 and 2025 is not federally taxable. This applies to the 2022 Navient settlement discharges as well as federal discharges. However, state taxes are tricky. Some states conform to federal rules automatically, while others (like Mississippi, North Carolina, Wisconsin, and Arkansas) may still treat cancelled student debt as taxable income.
Check with a tax professional in your specific state. You do not want to be surprised by a state tax bill the year after you finally get rid of the loan balance.
What To Do If You Still Owe Money
If you checked the lists and realized you missed the forgiveness boat, you still have to manage the debt. Ignoring it leads to wage garnishment (for federal loans) or lawsuits (for private loans). The first step is verifying the debt.
Send a debt validation letter if the loan has been sold to a new collector. Make them prove they own the paper and that the amount is correct. Errors in transfer paperwork are common, and if they cannot validate the debt, they cannot collect.
For private loans with high interest rates, refinancing is a standard move. You trade the existing loan for a new one with a private lender at a lower rate. This requires a decent credit score and a steady income. Be careful refinancing federal loans into private ones, as you lose all federal protections, including access to future forgiveness programs.
Credit Reporting Corrections
For those lucky enough to qualify for the 2022 settlement, the relief included instructions to credit bureaus to delete the trade lines. This should improve your debt-to-income ratio significantly. However, credit bureaus make mistakes.
Pull your free credit reports from AnnualCreditReport.com. Check the Navient entry. It should show a zero balance or be removed entirely if that was part of your specific relief terms. If it still shows a balance or a “charge-off” status that hurts your score, file a dispute immediately. Include a copy of your settlement notice as proof.
Disputes usually resolve within 30 days. This is a vital step because a lingering charge-off can depress your credit score for seven years, affecting your ability to rent an apartment or buy a car.
Understanding The Scope Of Relief
The scale of the student debt crisis often makes individual settlements feel small. The $1.7 billion figure sounds enormous, but it only covered about 66,000 borrowers. Millions more still owe Navient for private loans or Aidvantage for transferred federal loans.
Realizing that the answer to are all Navient loans forgiven is negative can be disheartening. However, knowing exactly where you stand prevents you from waiting for a miracle that isn’t coming. It allows you to pivot to strategies that actually work, such as aggressive repayment, refinancing, or asserting your rights against zombie debt.
Keep detailed records of every payment and communication. Servicers have a history of record-keeping errors. Your own documentation is your best defense against misapplied payments or incorrect interest calculations. Whether you qualify for a discharge or simply pay it off the hard way, staying informed puts you in control of your financial future.