Nelnet And Great Lakes Will no longer Service Your Federal Student Loans
If Nelnet or Great Lakes service your federal student loans, you might get a whole new student loan servicer.
Here is what you have to understand.
Great Lakes and nelnet, which are actually a part of the same business and collectively service federal pupil loans for around thirteen million pupil loan borrowers, could not anymore 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 pupil loan servicing. What is a student loan servicer? Whenever you spend federal student loans, you don’t pay the federal government or Department of Education directly. Instead, you pay your student loan servicer, which collects your student loan payments and supplies customer service.
This is another major step toward the dedication of ours to improving customer service and holding the contractors of ours responsible for their performance, DeVos said. Students, parents, borrowers, along with schools deserve a world class experience when addressing [Federal Pupil Aid], and I’m confident that FSA has employed the companies 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 Student Aid – which provides greater than $120 billion of financial aid to greater than sixty eight million pupils across 5,800 postsecondary institutions each year – signed contracts with five pupil loan servicers to service federal pupil loans and also provide 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 Pupil Loan Servicer
DeVos wishes to streamline as well as simplify student loan repayment. Under DeVos’ new plan, you might begin making pupil loan payments through a centralized platform, studentaid.gov, instead of through the unique student loan servicer sites. DeVos believes the present pupil loan servicing platform lacks accountability and consistency, which hurts student loan borrowers.
Nelnet: We are shocked We’re shocked that the two highest rated servicers as well as the committed employees who are liable for obtaining those rankings won’t be considered by the Department because of this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated and disappointed by the absence and this selection of transparency in the process and will pursue every legal avenue 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 pupil loans for 5.5 million borrowers below its contract, and Lakes which are Great was servicing $243.2 billion of student loans for 7.3 million borrowers under its contract. These servicing contracts expire on December fourteen, 2020 with two optional six month extensions through December fourteen, 2021. Individually, Nelnet services $48.7 billion in FFELP, private training and customer loans for 2.1 million borrowers which aren’t influenced by the Education Department’s decision.
The thing you must do next
When Nelnet or Great Lakes service your federal student loans:
Do not panic.
Keep making your regular monthly student loan payments to Great Lakes or Nelnet.
You do not have to use for a new student loan servicer.
The Education Department will assign you a new student loan servicer and often will get in touch with you in advance of any transition.
As soon as you’re informed of your brand new student loan servicer, you’ll be able to begin driving pupil loan payments to your new pupil loan servicer.
When that happens, be sure to update car payments.
How to pay off student loans more rapidly If you have student loans, ensure to end up with a game plan. What’s the easiest way to pay off pupil loans faster? Start with these four options, each one of which have no fees: