Nelnet And Great Lakes Will not Service Your Federal Student Loans
If Nelnet or even Great Lakes service your federal student loans, you may get a whole new student loan servicer.
Here’s what you need to know.
Student Loans
Great Lakes and nelnet, which are a part of the very same business and together service federal student loans for around 13 million pupil loan borrowers, could very well not service federal student loans after December 2020. The surprise announcement comes as the U.S. Department of Education, led by Education Secretary Betsy DeVos, seeks to enhance student loan servicing. What’s a student loan servicer? If you pay out federal student loans, you don’t spend the federal government or perhaps Department of Education directly. Instead, you pay the student loan servicer of yours, which collects the student loan payments of yours and provides customer care.
This is another key step toward our commitment to improving customer support and holding our contractors accountable for the performance of theirs, DeVos said. Students, parents, borrowers, along with schools deserve a world-class encounter when addressing [Federal Pupil Aid], and I am confident that FSA has employed the companies with the knowledge, experience and expertise to provide that.
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What Happened
On June twenty four, the Department of Education announced that Federal Pupil Aid – which provides more than $120 billion of financial aid to more than sixty eight million students across 5,800 postsecondary institutions every year – signed contracts with five student loan servicers to service federal student loans as well as give 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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DeVos would like to streamline as well as simplify pupil loan repayment. Underneath DeVos’ brand new strategy, you may begin making student loan payments through a centralized platform, studentaid.gov, as opposed to through the unique pupil loan servicer websites. DeVos believes the current student loan servicing platform lacks consistency and accountability, which hurts pupil loan borrowers.
Nelnet: We are shocked We’re surprised that the two highest rated servicers and also the committed personnel that are responsible for getting those rankings won’t be looked at by the Department because of this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated as well as disappointed by this selection and the absence of transparency in the task and can pursue every legitimate avenue available to make sure 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 pupil loans for 5.5 million borrowers below the contract of its, and Lakes which 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 2 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 which are not impacted by the Education Department’s decision.
The thing you need to do next
If Nelnet or Great Lakes service your federal pupil loans:
Don’t panic.
Keep making your regular monthly student loan payments to Great Lakes or even Nelnet.
You do not need to use for a new pupil loan servicer.
The Education Department will assign you a new student loan servicer and often will speak with you in advance of any transition.
Once you’re informed of your new pupil loan servicer, you can begin driving pupil loan payments to your new student loan servicer.
When that happens, be sure to update car payments.
How you can pay off student loans more rapidly If you have pupil loans, be sure to end up with a game plan. What’s the best way to pay off student loans faster? Begin with these 4 options, all of which have no fees:
