Nelnet And Great Lakes Will not Service Your Federal Student Loans
If Nelnet or Great Lakes service your federal student loans, you might get a brand new student loan servicer.
Here is what you have to know.
Great Lakes and nelnet, which are actually a part of the same company and collectively service federal student loans for around thirteen million student loan borrowers, could very well 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 enhance pupil loan servicing. What is a pupil loan servicer? If you spend federal student loans, you don’t spend the federal government or Department of Education directly. Rather, you pay your student loan servicer, which collects your student loan payments and provides customer support.
This is another major step toward the commitment of ours to improving customer service and holding the contractors of ours accountable for their performance, DeVos said. Students, parents, borrowers, along with schools deserve a world-class experience when addressing [Federal Pupil Aid], and I am confident that FSA has hired the companies with the expertise, expertise and experience to give 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 greater than 68 million pupils across 5,800 postsecondary institutions every year – contracts which are signed with 5 pupil loan servicers to service federal student loans and also give enhanced consumer 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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What to Know About Your Student Loan Servicer
DeVos wishes to streamline and simplify student loan repayment. Under DeVos’ brand new strategy, you could start making student loan payments by way of a centralized platform, studentaid.gov, rather than through the individual pupil loan servicer websites. DeVos feels the current pupil loan servicing system lacks consistency and accountability, which hurts pupil loan borrowers.
Nelnet: We are shocked We’re shocked that the two highest rated servicers and also the committed employees that are accountable for achieving those rankings won’t be looked at by the Department due to this contract, Nelnet CEO Jeff Noordhoek said. We are frustrated and disappointed by this decision and the absence of transparency in the task and often will engage in every legitimate avenue readily available to make sure that students have the premium quality service they have 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 below the contract of its, and Great Lakes 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 fourteen, 2021. Separately, Nelnet services $48.7 billion in FFELP, private education as well as customer loans for 2.1 million borrowers that are not influenced by the Education Department’s decision.
The thing you must 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 do not need to apply for a brand new student loan servicer.
The Education Department will assign you a new student loan servicer and can speak with you in advance of any transition.
Once you’re informed of your new student loan servicer, you’ll be able to begin driving student loan payments to your new student loan servicer.
As soon as that happens, be sure to update auto payments.
How you can pay off pupil 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? Start with these 4 options, every one of which have no fees: