Nelnet And Great Lakes Will not Service Your Federal Student Loans
When Nelnet or Great Lakes service the federal student loans of yours, you might get a whole new student loan servicer.
Here is what you need to understand.
nelnet and Great Lakes, which are actually a component of the very same business and together service federal student loans for around 13 million pupil loan borrowers, could very well not service federal student loans after December 2020. The surprise announcement comes as the U.S. Department of Education, led by Education Secretary Betsy DeVos, seeks to enhance student loan servicing. What is a student loan servicer? Whenever you pay federal student loans, you don’t spend the federal government or Department of Education directly. Instead, you pay your student loan servicer, which collects the student loan payments of yours and offers customer care.
This’s another major step toward our commitment to improving customer service and holding our contractors responsible for their performance, DeVos said. Students, parents, borrowers, as well as schools deserve a world class encounter when addressing [Federal Student Aid], and I’m confident that FSA has employed the companies with the know how, expertise and experience to deliver that.
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On June twenty four, the Department of Education announced that Federal Pupil Aid – which provides more than $120 billion of financial aid to greater than sixty eight million students across 5,800 postsecondary institutions each year – contracts which are signed with 5 pupil loan servicers to service federal student loans and also provide enhanced customer support:
Edfinancial Services LLC
F.H. Cann & Associates LLC
MAXIMUS Federal Services Inc.
Missouri Higher Education Loan Authority (MOHELA)
Texas Guaranteed Student Loan Corporation (Trellis Company)
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Things to Know About Your Student Loan Servicer
DeVos wishes to streamline and simplify pupil loan repayment. Under DeVos’ new plan, you may begin making pupil loan payments through a centralized platform, studentaid.gov, instead of through the individual pupil loan servicer websites. DeVos believes the present student loan servicing platform lacks consistency and accountability, which hurts student loan borrowers.
Nelnet: We’re shocked We’re shocked that the two highest rated servicers as well as the dedicated personnel that are liable for getting those rankings won’t be looked at by the Department for this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated as well as disappointed by this choice and the lack of transparency in the process and will pursue every legitimate avenue readily available to ensure that pupils have the high quality service they’ve come to expect from us.
In June 2009, the Education Department awarded Nelnet pupil loan servicing contracts. As of March 31, 2020, Nelnet was servicing $185.5 billion of pupil loans for 5.5 million borrowers under its contract, and Great Lakes was servicing $243.2 billion of pupil loans for 7.3 million borrowers under its contract. These servicing contracts expire on December 14, 2020 with two optional six-month extensions through December fourteen, 2021. Separately, Nelnet services $48.7 billion in FFELP, private schooling as well as customer loans for 2.1 million borrowers that aren’t influenced by the Education Department’s decision.
What you should do next
When Nelnet or perhaps Great Lakes service your federal pupil loans:
Do not panic.
Always keep making your regular monthly student loan payments to Great Lakes or perhaps Nelnet.
You don’t have to apply for a brand new student loan servicer.
The Education Department is going to assign you a brand new student loan servicer and often will communicate with you in advance of any change.
As soon as you are informed of your new pupil loan servicer, you can start driving pupil loan payments to your new student loan servicer.
As soon as that happens, be sure to update auto payments.
How to pay off pupil loans more quickly If you’ve student loans, be sure to have a game plan. What’s the best way to pay off pupil loans faster? Start with these 4 options, all of which have no fees: