Nelnet And Great Lakes Will not Service Your Federal Student Loans
If Nelnet or perhaps Great Lakes service the federal student loans of yours, you might get a whole new student loan servicer.
Here is what you have to know.
nelnet and Great Lakes, which are part of the same company and collectively service federal student loans for approximately 13 million student loan borrowers, may 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 pupil loan servicing. What is a pupil loan servicer? When 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 supplies customer service.
This is another major step toward the commitment of ours to improving customer support and holding our contractors responsible for their performance, DeVos said. Students, parents, borrowers, and schools deserve a world-class encounter when managing [Federal Student Aid], and I am confident that FSA has employed the businesses 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 greater than $120 billion of financial aid to greater than sixty eight million pupils across 5,800 postsecondary institutions per year – contracts which are signed with 5 student loan servicers to service federal pupil loans and provide 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 Student Loan Servicer
DeVos would like to streamline as well as simplify student loan repayment. Under DeVos’ new plan, you may begin making student loan payments via a centralized platform, studentaid.gov, rather than through the unique student loan servicer sites. DeVos feels the current pupil loan servicing platform lacks consistency and accountability, which hurts student loan borrowers.
Nelnet: We are shocked We are shocked that the 2 highest rated servicers and the committed employees who are liable for achieving those rankings won’t be considered by the Department because of this agreement, Nelnet CEO Jeff Noordhoek said. We are frustrated and disappointed by this choice and the lack of transparency in the process and often will engage in every legitimate avenue readily available to make sure that pupils have the high quality service they’ve come to expect from us.
In June 2009, the Education Department awarded Nelnet student 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 student 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 fourteen, 2021. Separately, Nelnet services $48.7 billion in FFELP, private education and consumer loans for 2.1 million borrowers that are not impacted by the Education Department’s decision.
The thing you should do next
When Nelnet or even Great Lakes service your federal pupil 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 will assign you a brand new student loan servicer and often will communicate with you in advance of any change.
After you are informed of your brand new student loan servicer, you’ll be able to begin driving pupil loan payments to your new student loan servicer.
Once that happens, make sure to update auto payments.
How to pay off student loans faster If you’ve student loans, make sure to have a game plan. What’s the easiest way to pay off pupil loans faster? Begin with these 4 options, all of which have no fees: