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Navient is transferring 6 million student-loan borrowers' accounts to Maximus next year.
Sen. Elizabeth Warren has expressed concern with how borrowers may be treated under the new company.
But Maximus said in a statement that it agrees with Warren, and a smooth transition is "imperative."
Sen. Elizabeth Warren has had a contentious relationship with student-loan companies for a decade now over their treatment of borrowers. But when it comes to ensuring a smooth transition back to repayment next year, one of those companies said it saw eye to eye with the Massachusetts Democrat.
Navient, a student-loan company that services 6 million federal borrowers, announced in October that it would be ending its federal contract with the Education Department and transferring accounts to a new company, Maximus. This was welcome news to Warren, who has held Navient in her sights for years over the company's practices that steered borrowers into greater student debt.
"Navient has spent decades misleading, cheating, and abusing student borrowers," Warren previously told Insider in a statement. "The federal student-loan program will be far better off without them."
But her oversight didn't end there. Last month, she sent a letter to Maximus to ensure borrowers wouldn't be subject to the same "abusive practices" that they experienced under Navient, and she requested information from the company on how it would facilitate a smooth transition for the borrowers it's taking on.
In a statement to Insider, Eileen Rivera, a spokesperson for Maximus, responded, "This is a defining moment for student borrowers, and we couldn't agree more with Sen. Warren — it is imperative we get it right."
Rivera added that the company was working to respond to Warren's questions and ensure Warren and her staff "share the Department of Education's confidence in us as the servicing of these student loans transitions from Navient to Maximus."
Navient is one of the three companies that announced plans to end its federal services. In October, Richard Cordray, the head of Federal Student Aid, said in a statement that the remaining student-loan companies — including Maximus — must be held to higher standards.
"FSA is raising the bar for the level of service student loan borrowers will receive," Cordray said. "Our actions come at a critical time as we help borrowers prepare for loan payments to resume early next year. The great work done by our negotiating team here enables us to ensure that loan servicers meet the tougher standards or face consequences."
Rivera said, Maximus will remain "independent and conflict-free as we do not and will never provide loan origination, consolidation or collection services."
The "conflict" she referred to was something that was common under Navient and other loan companies. Warren released an audit in 2018 that provided evidence of Navient's record of causing students to go into greater student debt by "steering student borrowers into forbearance when that was often the worst financial option for them."
And borrowers were also steered in the wrong direction when it came to loan repayment. Lindsay Averbook, a 38-year-old with $81,000 in student debt, previously told Insider she'd been "tossed around 15 times" when trying to request help in paying off her debt.
It remains to be seen how smooth the transition back to repayment will be, but an Education Department spokesperson previously told Insider the department would continue to work to ensure that all its "borrowers can experience a successful return to repayment."
Read the original article on Business Insider