Nelnet And Great Lakes Will not Service Your Federal Student Loans
When Nelnet or even Great Lakes service the federal student loans of yours, you may get a whole new pupil loan servicer.
Here is what you have to understand.
Great Lakes and nelnet, which are part of the same company and together service federal pupil loans for around 13 million pupil loan borrowers, could no longer 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 improve pupil loan servicing. What’s a pupil loan servicer? When you spend federal student loans, you don’t spend the federal government or Department of Education directly. Instead, you pay your student loan servicer, which collects your student loan payments and offers customer service.
This’s another key step toward our commitment to improving customer care and holding our contractors accountable for their performance, DeVos said. Students, parents, borrowers, along with schools deserve a world-class encounter when managing [Federal Student Aid], and I am confident that FSA has hired the companies with the knowledge, expertise and experience to deliver that.
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On June 24, the Department of Education announced that Federal Pupil Aid – which provides more than $120 billion of financial aid to more than 68 million pupils across 5,800 postsecondary institutions every year – signed contracts with 5 pupil 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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Things to Know About Your Student Loan Servicer
DeVos wishes to streamline as well as simplify student loan repayment. Under DeVos’ new strategy, you may begin making student loan payments by way of a centralized platform, studentaid.gov, rather than through the unique student loan servicer sites. DeVos thinks the present student loan servicing platform lacks consistency and accountability, which hurts pupil loan borrowers.
Nelnet: We are surprised We are surprised that the 2 highest rated servicers as well as the dedicated personnel who are responsible for obtaining those rankings will not looked into by the Department because of this contract, Nelnet CEO Jeff Noordhoek said. We are frustrated as well as disappointed by the lack and this choice of transparency in the task and will engage in every legal avenue readily available to make sure that students 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 thirty one, 2020, Nelnet was servicing $185.5 billion of student loans for 5.5 million borrowers under its contract, and Great Lakes was servicing $243.2 billion of pupil 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. Separately, Nelnet services $48.7 billion in FFELP, private training and consumer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.
The thing you need to do next
When Nelnet or Great Lakes service your federal student loans:
Keep making your regular monthly student loan payments to Great Lakes or even Nelnet.
You don’t have to apply for a new pupil loan servicer.
The Education Department is going to assign you a brand new student loan servicer and will communicate with you in advance of any transition.
After you are informed of your brand new student loan servicer, you can begin driving student loan payments to your new student loan servicer.
When that happens, make sure to update car payments.
How you can pay off pupil loans more quickly If you have student loans, be sure to end up with a game plan. What’s the simplest way to pay off pupil loans quicker? Begin with these four options, each one of which have no fees: