Nelnet And Great Lakes Will not Service Your Federal Pupil Loans
When Nelnet or perhaps Great Lakes service your federal student loans, you may get a new student loan servicer.
Here’s what you have to understand.
nelnet and Great Lakes, which are a part of the same business and jointly service federal student loans for approximately thirteen million student loan borrowers, may very well 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 boost student loan servicing. What is a student loan servicer? When you spend federal student loans, you don’t spend the federal government or maybe Department of Education directly. Instead, you pay the student loan servicer of yours, which collects your student loan payments and provides customer support.
This is another major step toward our commitment to improving customer support and holding our contractors responsible for the performance of theirs, DeVos said. Pupils, parents, borrowers, and schools deserve a world class encounter when dealing with [Federal Student Aid], and I’m confident that FSA has hired the organizations with the knowledge, experience and expertise to give that.
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On June 24, the Department of Education announced that Federal Student Aid – which provides greater than $120 billion of financial aid to greater than 68 million students across 5,800 postsecondary institutions annually – contracts which are signed with 5 pupil loan servicers to service federal pupil 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 Pupil Loan Servicer
DeVos wishes to streamline and simplify pupil loan repayment. Under DeVos’ brand new strategy, you may start making student loan payments by way of a centralized platform, studentaid.gov, rather than through the individual student loan servicer websites. DeVos thinks the present pupil loan servicing system lacks consistency and accountability, which hurts pupil loan borrowers.
Nelnet: We’re shocked We’re shocked that the 2 highest rated servicers and also the committed personnel that are responsible for getting those rankings won’t be considered by the Department due to this agreement, Nelnet CEO Jeff Noordhoek said. We are frustrated as well as disappointed by this decision and the absence of transparency in the process and can pursue every legitimate avenue available to ensure that pupils have the good 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 under its contract, 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 two optional six month extensions through December 14, 2021. Separately, Nelnet services $48.7 billion in FFELP, private schooling as well as customer loans for 2.1 million borrowers that are not impacted by the Education Department’s decision.
What you need to do next
When Nelnet or perhaps Great Lakes service your federal student loans:
Do not panic.
Keep making your regular monthly pupil loan payments to Great Lakes or even Nelnet.
You do not need to apply for the latest student loan servicer.
The Education Department is going to assign you a new pupil loan servicer and often will communicate with you in advance of any change.
Once you’re informed of your new student loan servicer, you can begin driving pupil loan payments to your new student loan servicer.
Once that happens, be sure to update auto payments.
How to pay off pupil loans more quickly If you’ve student loans, ensure to use a game plan. What’s the easiest way to pay off student loans quicker? Start with these 4 options, all of which have no fees: