Nelnet And Great Lakes Will no longer Service Your Federal Student Loans
When Nelnet or even Great Lakes service your federal student loans, you may get a brand new pupil loan servicer.
Here is what you have to know.
nelnet and Great Lakes, which are a component of the same company and together service federal pupil loans for around thirteen million pupil loan borrowers, may no longer service federal pupil loans after December 2020. The surprise announcement comes as the U.S. Department of Education, led by Education Secretary Betsy DeVos, seeks to boost student loan servicing. What is a student loan servicer? Whenever you pay federal student loans, you do not pay the federal government or maybe Department of Education directly. Instead, you pay the student loan servicer of yours, which collects your student loan payments and provides customer service.
This’s another key step toward our commitment to improving customer service and holding the contractors of ours accountable for their performance, DeVos said. Students, parents, borrowers, as well as schools deserve a world-class experience when addressing [Federal Pupil Aid], and I’m confident that FSA has hired the companies with the knowledge, expertise and experience to deliver that.
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On June 24, the Department of Education announced that Federal Student Aid – which provides more than $120 billion of financial aid to more than 68 million students across 5,800 postsecondary institutions annually – signed contracts with 5 student loan servicers to service federal student loans and give enhanced consumer 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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What you should Know About Your Pupil Loan Servicer
DeVos would like to streamline and simplify pupil loan repayment. Under DeVos’ new strategy, you might begin making student loan payments by way of a centralized platform, studentaid.gov, instead of through the unique student loan servicer sites. DeVos believes the present student loan servicing structure lacks accountability and consistency, which hurts student loan borrowers.
Nelnet: We are surprised We are surprised that the two highest rated servicers and also the dedicated employees that are accountable for obtaining those rankings won’t looked into by the Department due to this agreement, Nelnet CEO Jeff Noordhoek said. We are frustrated and disappointed by this selection and the absence of transparency in the task and will pursue every legitimate avenue readily available to make sure that pupils have the premium quality service they have 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 below its contract, and Lakes that are Great was servicing $243.2 billion of pupil loans for 7.3 million borrowers under its agreement. These servicing contracts expire on December 14, 2020 with two optional six month extensions through December 14, 2021. Individually, Nelnet services $48.7 billion in FFELP, private education and customer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.
The thing you must do next
When Nelnet or Great Lakes service your federal student loans:
Keep making your regular monthly pupil loan payments to Great Lakes or even Nelnet.
You do not have to use for the latest student loan servicer.
The Education Department is going to assign you a new pupil loan servicer and can speak with you in advance of any transition.
After you’re informed of your new student loan servicer, you can start driving student loan payments to your new student loan servicer.
When that happens, be sure to update car payments.
How you can pay off student loans faster If you’ve student loans, make sure to have a game plan. What’s the best way to pay off student loans faster? Begin with these 4 options, each one of which have no fees: