Nelnet And Great Lakes Won’t Service Your Federal Pupil Loans
When Nelnet or even Great Lakes service the federal student loans of yours, you may get a brand new pupil loan servicer.
Here’s what you need to understand.
Great Lakes and nelnet, which are actually a part of the very same business and collectively service federal pupil loans for around 13 million student loan borrowers, may very well not 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’s a student loan servicer? If you pay federal student loans, you do not pay the federal government or Department of Education directly. Rather, you pay your student loan servicer, which collects your student loan payments and provides customer care.
This’s another major step toward our commitment to improving customer care and holding our contractors responsible for the performance of theirs, DeVos said. Students, parents, borrowers, along with schools deserve a world class experience when managing [Federal Student Aid], and I’m confident that FSA has hired the businesses with the expertise, expertise and experience to give that.
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On June twenty four, the Department of Education announced that Federal Pupil Aid – which provides greater than $120 billion of financial aid to greater than 68 million students across 5,800 postsecondary institutions per year – signed contracts with five pupil loan servicers to service federal pupil loans as well as deliver enhanced customer support:
Edfinancial Services LLC
F.H. Cann & Associates LLC
MAXIMUS Federal Services Inc.
Missouri Higher Education Loan Authority (MOHELA)
Texas Guaranteed Pupil Loan Corporation (Trellis Company)
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Things to Know About Your Student Loan Servicer
DeVos would like to streamline and simplify student loan repayment. Underneath DeVos’ new plan, you might start making student loan payments by way of a centralized platform, studentaid.gov, instead of through the individual student loan servicer websites. DeVos feels the current student loan servicing structure lacks accountability and consistency, which hurts pupil loan borrowers.
Nelnet: We are shocked We’re surprised that the two highest rated servicers as well as the committed employees who are accountable for getting those rankings will not be looked at by the Department due to this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated and disappointed by the lack and this selection of transparency in the process and will engage in every legal avenue 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 student loans for 5.5 million borrowers under 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 fourteen, 2020 with 2 optional six-month extensions through December fourteen, 2021. Separately, Nelnet services $48.7 billion in FFELP, private education as well as consumer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.
The thing you need to do next
When Nelnet or Great Lakes service your federal pupil loans:
Do not panic.
Always keep making your regular monthly student loan payments to Great Lakes or Nelnet.
You do not need to apply for the latest pupil loan servicer.
The Education Department will assign you a new pupil loan servicer and can communicate with you in advance of any change.
Once you’re informed of your brand new student loan servicer, you can start driving pupil loan payments to your new pupil loan servicer.
Once that happens, be sure to update car payments.
How you can pay off pupil loans more rapidly If you have student loans, be sure to have a game plan. What’s the best way to pay off pupil loans quicker? Start with these 4 options, all of which have no fees: