Chris Radburn/Press Association via AP Images S tudent loan-servicing companies are an underappreciated part of a debt-for-diploma system that has badly failed college students and graduates. The loans themselves are a mix of direct federal loans, state loans, and private ones guaranteed by the government, but virtually all payments are collected by loan servicers. These companies, as for-profit middlemen, can pile on unnecessary costs to indebted students and steer them to act against their own self-interest. The Obama administration sought to rein in abuses, issuing policy guidelines for loan servicers and allowing relief for students who were misled by for-profit colleges—but stopped short of formally regulating the loan-servicing industry. Earlier this year, the largest of the nine loan-servicing companies, Navient Corp, formerly part of lender Sallie Mae, became the target of lawsuits from consumers, state attorneys general, and the Consumer Financial Protection Bureau (CFPB)...