Nelnet And Great Lakes Won’t Service Your Federal Pupil Loans
When Nelnet or perhaps Great Lakes service the federal student loans of yours, you might get a brand new student loan servicer.
Here’s what you need to know.
Great Lakes and nelnet, which are actually a component of the same business and together service federal student loans for approximately 13 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 improve pupil loan servicing. What’s a student loan servicer? If you pay out federal student loans, you do not pay the federal government or Department of Education directly. Instead, you pay the student loan servicer of yours, which collects your student loan payments and offers customer support.
This’s another key step toward our commitment to improving customer service and holding our contractors accountable for their performance, DeVos said. Students, parents, borrowers, along with schools deserve a world-class experience when dealing with [Federal Pupil Aid], and I’m confident that FSA has hired the organizations with the expertise, experience and expertise to give that.
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On June 24, the Department of Education announced that Federal Pupil Aid – which provides greater than $120 billion of financial aid to greater than 68 million students across 5,800 postsecondary institutions per year – signed contracts with five pupil loan servicers to service federal pupil loans and 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 wishes to streamline as well as simplify student loan repayment. Under DeVos’ new strategy, you might start making student loan payments via a centralized platform, studentaid.gov, rather than through the individual student loan servicer sites. DeVos thinks the current pupil loan servicing system lacks accountability and consistency, which hurts student loan borrowers.
Nelnet: We are surprised We are shocked that the 2 highest rated servicers as well as the committed employees that are liable for achieving those rankings won’t looked into by the Department due to this contract, Nelnet CEO Jeff Noordhoek said. We are frustrated and disappointed by the lack and this selection of transparency in the process and can engage in every legal avenue readily available to make sure that pupils 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 its contract, and Lakes that are Great was servicing $243.2 billion of pupil loans for 7.3 million borrowers under its agreement. 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 schooling as well as customer loans for 2.1 million borrowers that aren’t influenced by the Education Department’s decision.
What you need to do next
If Nelnet or even Great Lakes service your federal student loans:
Do not panic.
Keep making your regular monthly student loan payments to Nelnet or perhaps Great Lakes.
You don’t have to apply for a brand new student loan servicer.
The Education Department will assign you a new student loan servicer and will communicate with you in advance of any change.
Once you are informed of your brand new student loan servicer, you’ll be able to start sending student loan payments to your new student loan servicer.
As soon as that happens, ensure to update car payments.
How you can pay off pupil loans faster If you’ve student loans, make sure to have a game plan. What is the best way to pay off student loans faster? Start with these 4 options, all of which have no fees: