Student borrowers across the U.S. are about to see their student loan debt forgiven after a legal settlement was reached with one of the largest providers on Thursday.

Navient, a Delaware-based company, struck a deal with 39 states that would see loans serviced by the company forgiven. Under the terms of the agreement, the students who will benefit were found to have been provided loans despite evidence that they would be unable to repay their debts to Navient. It is expected that 66,000 student borrowers will receive relief as a result of this settlement.

State attorney generals and student loan activists praised the ruling as a victory for students saddled with burdensome debts.

“For too long, Navient contributed to the national student debt crisis by deceptively trapping thousands of students into more debt,” said New York Attorney General Letitia James in a statement. According to James, the ruling would result in more than $110 million in canceled debt for residents of her state.

"Student loan servicers that operate through deception and wrongdoing will not be tolerated and will be held accountable by my office,” James added.

Josh Stein, North Carolina's attorney general, praised the decision as a necessary measure of accountability for Navient or other student loan providers, who engage in similar behavior.

"These people borrowed money so they could get the education they needed to build successful lives, but Navient pushed them toward harmful financial decisions and predatory loans," said Stein in a statement. "I’m pleased we’re holding Navient accountable, and I’ll continue to do everything I can to protect student borrowers.”

Under the agreement, it was found that Navient was aware that some of the loans that it was making were likely to go unpaid. Many of those who received loans attended for-profit schools that often had records of low graduation rates and poor job placements. At some schools, Navient anticipated that more than 90% of the loans were at risk of default. Today, the company is no longer servicing loans from the Department of Education.

As part of the terms of the deal, Navient did not have to admit to knowingly violating any laws. In a statement after the ruling was reached, Navient’s Chief Legal Officer Mark Heleen said that the company opted to settle to avoid any protracted court battle. It added that it would provide one-time payments of $145 million to the states for distribution, something it estimated to be less than the costs of a longer legal battle.

This is not the only lawsuit that is facing Navient. There is a separate lawsuit alleging deceptive, predatory practices by the firm that has been made by the Consumer Financial Protection Bureau together with six other states that remains undecided.

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