Nelnet And Great Lakes Won’t Service Your Federal Student Loans
If Nelnet or even Great Lakes service your federal student loans, you might get a new student loan servicer.
Here’s what you need to know.
Great Lakes and nelnet, which are actually part of the very same business and collectively service federal student loans for around thirteen million pupil loan borrowers, might not anymore 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 improve pupil loan servicing. What is a pupil loan servicer? Whenever you pay federal student loans, you do not spend the federal government or Department of Education directly. Rather, you pay the student loan servicer of yours, which collects your student loan payments and offers customer support.
This’s another major step toward the dedication of ours to improving customer support and holding the contractors of ours accountable for the performance of theirs, DeVos said. Students, parents, borrowers, and schools deserve a world-class encounter when dealing with [Federal Student Aid], and I am confident that FSA has hired the companies with the know how, experience and expertise to give 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 68 million students across 5,800 postsecondary institutions every year – contracts that are signed with five student loan servicers to service federal pupil loans as well as 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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Things to Know About Your Student Loan Servicer
DeVos would like to streamline and simplify student loan repayment. Under DeVos’ new strategy, you may begin making pupil loan payments by way of a centralized platform, studentaid.gov, instead of through the unique student loan servicer sites. DeVos believes the present pupil loan servicing system lacks accountability and consistency, which hurts pupil loan borrowers.
Nelnet: We’re shocked We’re shocked that the two highest rated servicers and the committed employees that are accountable for obtaining those rankings will not looked into by the Department due to this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated and disappointed by this selection and the lack of transparency in the process and often will pursue every legal avenue readily available to ensure that pupils have the premium quality service they’ve come to expect from us.
In June 2009, the Education Department awarded Nelnet student loan servicing contracts. As of March thirty one, 2020, Nelnet was servicing $185.5 billion of student loans for 5.5 million borrowers under the contract of its, and Great Lakes was servicing $243.2 billion of student loans for 7.3 million borrowers under its contract. These servicing contracts expire on December 14, 2020 with 2 optional six-month extensions through December 14, 2021. Individually, Nelnet services $48.7 billion in FFELP, private schooling as well as customer loans for 2.1 million borrowers that are not impacted by the Education Department’s decision.
What you should do next
If Nelnet or Great Lakes service your federal pupil loans:
Do not panic.
Keep making your regular monthly student loan payments to Nelnet or Great Lakes.
You don’t have to use for a brand new pupil loan servicer.
The Education Department will assign you a brand new pupil loan servicer and will communicate with you in advance of any change.
Once you’re informed of your brand new student loan servicer, you can begin driving pupil loan payments to your new pupil loan servicer.
As soon as that happens, make sure to update car payments.
How you can pay off pupil loans more rapidly If you’ve student loans, ensure to have a game plan. What’s the best way to pay off student loans quicker? Start with these four options, all of which have no fees: