Student Loan Settlement 2026: Navient Checks Arriving, SAVE Plan Dead & Major Forgiveness Updates
February 2026 is shaping up to be one of the most consequential months in the history of student loan policy. From Navient settlement checks landing in mailboxes to sweeping repayment plan overhauls, here is everything borrowers need to know right now.
Navient $120 Million Settlement: Checks Are in the Mail
The biggest student loan settlement news of February 2026 is the long-awaited payout from the landmark Navient case.
The payments are part of a $120 million settlement between Navient, once one of the nation's largest federal student loan servicers, and the U.S. Consumer Financial Protection Bureau. The deal resolves years of allegations that the company steered borrowers into costly repayment arrangements instead of guiding them toward more affordable options. Of the total settlement amount, $100 million has been set aside specifically to compensate affected borrowers. Checks ranging from roughly $100 to as much as $2,000 began going out in the mail on February 13, distributed by a third-party administrator acting on behalf of the CFPB.
Eligible borrowers were identified automatically — no claim form is required. Checks are being mailed by Rust Consulting, the court-appointed settlement administrator. Navient has also been permanently banned from servicing federal student loans as part of the settlement terms.
Who Qualifies for a Navient Settlement Check?
Eligible borrowers had one or more student loans serviced by Navient Solutions LLC or Pioneer Credit Recovery Inc. The companies steered them into forbearance instead of offering income-driven repayment plans, or Navient's servicing practices otherwise affected them. They may have experienced misapplied payments, inaccurate credit reporting, or received misinformation about repayment options.
California alone has more than 43,000 residents receiving restitution checks averaging about $260.
What the Navient Settlement Does NOT Do
The compensation checks are separate from borrowers' existing student loan accounts. Receiving a payment does not reduce or change any outstanding student loan balance. Borrowers should continue making payments on their student loans and working with their current loan servicer.
The SAVE Plan Is Effectively Dead
On December 9, 2025, the parties in Missouri reached a settlement agreement providing that the Education Department will not enforce the SAVE Plan and will formally withdraw the rule creating it. The SAVE Plan remains enjoined and is effectively off the books.
The 7.5 million borrowers who were enrolled in SAVE now need to be transitioned to other repayment plans, a process that is still being worked out. The One Big Beautiful Bill Act also phases out Income-Contingent Repayment and Pay As You Earn plans, which will end in mid-2028.
40,000+ Borrowers Newly Identified for Forgiveness
The Trump administration identified more than 40,000 borrowers eligible for federal student loan forgiveness in January 2026. More than 10,800 of the borrowers qualified under Income-Based Repayment, another 10,700 under Income-Contingent Repayment, and 18,160 federal student loan borrowers had their debts cancelled through the Public Service Loan Forgiveness program.
Major Warning: Student Loan Forgiveness Is Now Taxable
Many student loan borrowers who get their debt forgiven in 2026 can expect a hefty tax bill next year. A law that shielded the relief from federal taxation — part of the American Rescue Plan Act of 2021 — expired in December. The average loan balance for borrowers enrolled in an IDR plan is around $57,000. For those in the 22% tax bracket, having that amount forgiven would trigger a tax burden of more than $12,000.
Navient Settlement Quick-Reference Guide
| Detail | Information |
|---|---|
| Total settlement amount | $120 million |
| Borrower compensation fund | $100 million |
| Civil penalty to CFPB | $20 million |
| Checks began mailing | February 13, 2026 ET |
| Payment range | ~$100 to $2,000 |
| Settlement administrator | Rust Consulting |
| Do you need to file a claim? | No — payments sent automatically |
| Navient's future in federal loans | Permanently banned from servicing |
| Phone for questions | 1-800-711-8418 |
| Email for questions | [email protected] |
| Check doesn't reduce loan balance? | Correct — loan obligations remain unchanged |
The Navient settlement arrives at a particularly turbulent moment for the broader student loan landscape. More than 5 million Americans were in default on their federal student loans as of September, and millions more are behind on payments and at risk of default. The Education Department has confirmed it plans to resume wage garnishment for defaulted borrowers in early 2026.
