Student Loan News: Earnest Dies and Navient Takes Over Its Lifeless Body

‘Edgar’, Men in Black movie

Earnest Dies and Navient Takes Over Its Lifeless Body (repost)

One year ago, back in October of 2017, I wrote this post about Navient buying then student loan darling, Earnest. I mentioned the lawsuit against Navient, and borrowers likely concerns, as well as the founder-CEO’s impassioned plea to calm nerves and stem a possible mass exodus of customers. Borrowers were assured that Earnest would remain independent and that they would continue to be taken care of like they always had been.

Turns out the borrower concerns were well justified. One year later, that impassioned CEO, has collected a big payout check and left the company. Navient has installed new leadership and control.    

[Earnest Glassdoor September 2018 employee review]

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A big blunder in 2017 when leadership got rid of 20+ people in few days got more people leaving months later and degraded morale. Funding issues towards the end of 2017 also added to low morale.

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With Navient acquisition the excitement was high, like newly married couple on a honeymoon. Lots of promises about how Earnest will now thrive and how Navient is a great partner that will allow Earnest full independence.

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Well, don’t get fooled. Few months down the road the original Earnest CEO abruptly disappeared. New leadership coming from the East coast really unfamiliar with SF culture boasted about providing finances for growth and in the same breath demanded high profits and extra hard work.

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Basically Earnest lost or sold its soul. It is now Navient, period. A corporation. Sure, financing is now taken care of, but the business culture is corporate, Navient based, the soul is gone. For those who like that, you may thrive. All-hands meetings are more or less about three words: profit, profit, profit. Good luck.  

‘Edgar’, Men in Black movie

According to a Bloomberg article, both co-founders were supposed to remain to run Earnest as an independent unit.

The San Francisco-based startup was acquired by student loan provider Navient Corp. for $155 million after a lengthy search for a buyer. Beryl and his co-founder, Ben Hutchinson, were supposed to remain at the firm and continue running Earnest as a separate unit within the company. Hutchinson remains there as chief operating officer, Navient said.

Maybe Navient also lied to them about Earnest remaining independent? It would certainly benefit Navient to break Earnest as a competitor by eliminating it’s unique features, while simultaneously profiting off of the Earnest brand and getting access to tons of valuable personal and financial borrower information.

Online forum discussions have mentioned the sudden roll-out of Navient’s version of the dashboard to replace the Earnest dashboard. The turnover seems to include the addition of some features, yes, but also the stripping away of several others, most of which include key differentiating features that gave borrowers freedom and control over when and what they paid. Now apparently, borrowers have to call EarnestNavient rep on the phone in order to make any changes, and hope they don’t screw it up accidentally on purpose, among other new headaches.

Navient has already introduced itself to borrowers with lies. Unless you are close to paying off your EarnestNavient balance, you may want to interest rate shop at other student loan servicers.  There is no harm in looking now before rates go up even further. If you can’t leave, make sure to stay on top of your payments and keep proof of transactions. The real Earnest has died. You’d do well to be wary of the corporate husk wearing its skin.

“…like an Edgar suit.” Men in Black movie

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Do you have any experience with Navient as a student loan servicer? What have they been like for you?

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“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW Archives)

2 comments

  1. Anonymous · November 9

    That’s big business for you, build something and wait for an offer you can’t refuse.

    Like

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