Personal Finance

Don't pick up (or maybe you should): That annoying robocall could be about your student loans

Key Points
  • Many of the millions of robocalls Americans recieve each month are about debt.
  • Student loan borrowers are increasingly a target of these calls.
  • And advocates worry the situation could soon get worse if servicers aren't regulated enough. 
Bill Hinton | Getty Images

When the phone rang, James Hunter's legs burned in pain.

Ever since an accident when he was 30, he's been paralyzed from the waist down, and the relentless calls from Navient about his student loans triggered his nerves.

"Any time my phone would ring, I would get an anxiety attack," Hunter, 44, said.

His $60,000 in federal student loans have been canceled due to his severe disability, but Navient, one of the country's largest student loan servicers, is still collecting on his $40,000 in private loans. He sent the company notes from his doctor, and explained to them that he's in a wheelchair and unable to put his film degree to use, but to no avail. The calls continued.

"They had my back against the wall with no remedy," Hunter said. "I felt hopeless."

Now he's suing the company for damages from the harassment.

Navient called Hunter nearly 2,000 times, according to his lawyer Billy Peerce Howard, from The Consumer Protection Firm in Tampa, Florida. Peerce Howard is currently working on around a dozen other cases, in addition to Hunter's, against Navient over its robocall practices.

Nikki A. Lavoie, director of corporate communications at Navient, said many borrowers require one-on-one support to fully understand their options.

"Direct communication is critical to address, resolve, and avoid delinquent and defaulted loans," Lavoie said.

Many robocalls are about debt

While a lot of the conversation around robocalls centers on scams, many of these calls are actually from companies collecting debt. In fact, 9 out of the top 10 robocallers in June were calling about people's arrears, according to YouMail, a robocall blocking service.

Robocalls employ an automatic telephone dialer system, and when you pick up it can be a live person or a prerecorded message. The calls usually come in from different, and sometimes familiar, phone numbers so that you're more likely to pick them up.

As student debt in the country balloons, former students are increasingly the target of these calls.

Outstanding student loan debt in the U.S. is now over $1.5 trillion, surpassing auto and credit card debt and only behind housing debt. Around 1 in 5 student loan borrowers in the main, federal direct loan program are currently delinquent, according to Mark Kantrowitz, publisher of

What's more, consumer advocates are worried these calls will increase if the Federal Communications Commission does not impose tighter regulations on these companies, something they worry will not happen under the Trump administration.

"We're at war at the FCC," said Margot Saunders, a lawyer at the National Consumer Law Center. "On one side are consumers and people who are being called and harassed, and on the other side are callers, including Navient and other student loan servicers."

Student loan collectors fight to keep calling

In May, the Federal Communications Commission put out a request for comment on how the Telephone Consumer Protection Act, which Congress passed in 1991 to prohibit companies from calling a person's cellphone without their permission, should be interpreted in regard to autodialers.

Consumer advocates are concerned that the administration will side with the companies that want to keep calling consumers with less restriction. (In response to questions from a reporter, a spokesman for the FCC pointed to its initial public request for comment).

Saunders pointed to how the commission has already postponed an Obama-era rule that imposed regulations on debt collectors using autodialers to contact people regarding federal debts, including that they cannot call people more than three times in a month.

Source: Navient

In a recent letter to the Federal Communications Commission, a group of three major student loan servicers, including the Student Loan Servicing Alliance, a trade group, argued that those rules were "arbitrary, capricious, or an abuse of discretion," and that they "will hinder parties from assisting borrowers and collecting federal debts."

"They're saying, 'We can call you 100 times a day until you die and there's nothing you can do about it,'" said Peerce Howard at The Consumer Protection Firm.

Mistakes and other problems with autodialers

Last year, a handful of consumer advocacy groups wrote to the FCC, asking it to penalize Navient for robocalling student loan debtors, "repeatedly and abusively."

In the complaint, the groups cite dozens of lawsuits against the company for its call practices. A number of the cases were brought by people who said they were receiving calls for a debt that is not even theirs.

That's what happened to the Stein family.

Shortly after Leah Stein graduated from law school, she started receiving urgent calls from Navient that she was behind on her debt. She had her own student loans, but had never missed a payment.

"It made me nervous," Stein, 30, said. "I hoped I was paying the right thing."

But it turned out Navient was looking for a Laurie Stein, not her, Leah Stein.

They're saying, 'We can call you 100 times a day until you die and there's nothing you can do about it.'
William Peerce Howard
lawyer at The Consumer Protection Firm

But even after she explained that they were calling the wrong person, the calls continued. Navient also repeatedly called her father, her mother and her brother about these delinquent loans that were not hers.

Navient said it does not comment on pending litigation.

The family is now suing Navient for its "haphazard and unchecked use of its autodialer system."

Because the autodialing systems are so cheap to use — in one lawsuit, it's estimated to cost around 1 cent per minute — companies have no incentive to correct false information, said Peerce Howard of The Consumer Protection Firm.

"They know they can harass the hell out of people and the vast majority of them will not be able to find a lawyer who can fight for them," he said.

Saunders at the National Consumer Law Center said this approach to debt collection is dangerous and a more responsible method is needed.

"People don't pay their student loan debt because they're disabled, they lost their jobs, or something bad has happened," she said. "Not because they have tons of money and they're seeing if they can get away with it."

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