Navient Turns a Year-Ago Loss After Loan Sales

The Tip Desk · November 14, 2026 · 3 min read

GAAP net income was $15 million, or $0.16 a share, versus an $86 million loss a year earlier, with Core Earnings of $3 million after excluding $12 million of after-tax hedging gains and a tax benefit.

Navient (NAVI), the education-finance and consumer-lending company, reported third-quarter 2026 GAAP net income of $15 million, or $0.16 a share, versus a net loss of $86 million, or $0.87 a share, a year earlier. Core Earnings, which exclude $12 million of after-tax derivative hedging gains and a tax benefit, were $3 million, or $0.03 a share.

The swing from the year-ago loss was driven by items that did not exist in the prior-year quarter: $162 million of gains on the sale of about $750 million of Legacy Private Education Loans, including $91 million relating to an original acquisition discount, and $23 million of net fair value changes from electing the fair value option on In-School Loans originated in the quarter. There were no such sales or fair-value elections a year earlier.

Those gains sat against a much larger provision. Consumer Lending’s provision for loan losses was $214 million, up from $155 million a year earlier. The company said the current-quarter provision included $16 million associated with loan originations, $29 million from classifying $1.4 billion of Legacy Private Education Loans as held for sale, and $211 million primarily related to recent and forecasted delinquencies and charge-offs persisting at elevated levels for a longer duration than previously anticipated. That was partly offset by a $42 million decrease from classifying $1.0 billion of In-School Education Loans as held for sale.

Originations under the Earnest brand were $1.4 billion, up 77% from $788 million a year earlier. Refinance Education Loan originations were $870 million versus $528 million, In-School Loan originations were $479 million versus $260 million, and Personal Loan originations were $46 million versus zero, as the Personal Loan product launched in the fourth quarter of 2025. Average FICO scores were 775 for Refinance Loans, 770 for In-School Loans and 768 for Personal Loans.

Consumer Lending net interest income fell to $87 million from $98 million a year earlier. The company attributed the decline primarily to a higher share of Refinance Education Loans, which earn a lower net interest margin because of lower expected credit losses. Segment net interest margin was 2.09%. Private Education Loan net charge-offs were $59 million versus $96 million a year earlier, and the net charge-off rate was 1.49%. Greater-than-90-day delinquencies on Private Education Loans were $274 million versus $433 million; forbearances were $244 million versus $239 million. Those delinquency and forbearance rates exclude $2.4 billion of Private Education Loans classified as held for sale and $235 million of In-School loans carried at fair value.

Expenses in Consumer Lending were $57 million versus $45 million a year earlier, which the company said primarily reflected seasonal marketing and other expenses associated with the growth of consumer lending.

Federal Education Loans posted net income of $22 million versus $35 million a year earlier. Net interest income was $47 million versus $65 million; the company said the year-ago period included an $18 million benefit from reduced premium amortization as well as paydown of the loan portfolio. Segment net interest margin was 0.69%. The FFELP provision remained $13 million. Net charge-offs were $11 million versus $9 million, and the net charge-off rate was 0.20%. Greater-than-90-day delinquencies were $1.7 billion versus $2.5 billion, and forbearances were $3.1 billion versus $3.7 billion.

Ending Private Education Loans, net, were $15.254 billion versus $15.456 billion a year earlier. Ending FFELP Loans, net, were $25.898 billion versus $28.952 billion. Total education loans, net, were $41.152 billion versus $44.408 billion.

Chief executive Edward Bramson said the company classified approximately $2.4 billion of additional loans as held for sale and elected the fair value option for newly originated In-School Loans, and that it was evaluating additional loan sales as it continues to optimize the portfolio and reallocate capital toward more strategic uses.