Private Student Loan Borrowers - Glitch Triggered Default & Lawsuit

New for Business Insider, our latest installment in the "student debt spiral" series: How a "glitch in the system" landed a student-loan borrower in court. https://lnkd.in/eqfty5t9 Hannah Bates didn't believe the email. "Congratulations! We received the final payment on your loan," readthe surprise messagefrom Sallie Mae, her student loan lender. It was October 2024, and Bates owed Sallie Mae $55,000, with years of payments remaining. She called customer service for an explanation. "They told me there was a glitch in the system and I probably got emailed by accident," Bates, 30, said. "How do you make an accident on something that big?" Bates was behind on her payments at the time. After graduating in 2022, she initially kept up with the full $1,500 monthly bill. But about six months later, after takinga nursing jobthat paid $45,000 a year, she could only afford to pay roughly a third of it. During her call with customer service, she says she was advised to make a payment to avoid default. The payment she made over the phone never reflected on her balance, she says, and within a few weeks, she defaulted. About six months later, Sallie Mae sued. Read more about Bates' experience, in addition to our deep dive on the private student-loan industry, in the comments below. And if you have an experience to share about your student loans, I want to hear from you — message me here, email me at [email redacted], or find me on Signal at asheffey.97.