Nelnet And Great Lakes Won’t Service Your Federal Pupil Loans
If Nelnet or even Great Lakes service your federal student loans, you might get a whole new pupil loan servicer.
Here is what you have to understand.
Great Lakes and nelnet, which are part of the very same business and jointly service federal student loans for around thirteen million student loan borrowers, may no longer service federal pupil loans after December 2020. The surprise announcement comes as the U.S. Department of Education, led by Education Secretary Betsy DeVos, seeks to improve student loan servicing. What’s a pupil loan servicer? Whenever you pay 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 the student loan payments of yours and offers customer service.
This’s another major step toward our dedication to improving customer service and holding the contractors of ours responsible for the performance of theirs, DeVos said. Students, parents, borrowers, along with schools deserve a world class experience when addressing [Federal Student Aid], and I’m confident that FSA has hired the companies with the expertise, expertise and experience 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 pupils across 5,800 postsecondary institutions annually – contracts which are signed with 5 student loan servicers to service federal student loans as well as 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 Student Loan Servicer
DeVos wishes to streamline and simplify pupil loan repayment. Underneath DeVos’ brand new strategy, you could start making pupil loan payments via a centralized platform, studentaid.gov, rather than through the unique pupil loan servicer websites. DeVos feels the present student loan servicing structure lacks accountability and consistency, which hurts student loan borrowers.
Nelnet: We’re shocked We’re shocked that the two highest rated servicers and also the committed personnel who are liable for achieving those rankings won’t looked into by the Department for this agreement, Nelnet CEO Jeff Noordhoek said. We’re frustrated as well as disappointed by the absence and this decision of transparency in the process and will engage in every legal avenue available to ensure that students have the premium quality service they’ve come to expect from us.
In June 2009, the Education Department awarded Nelnet pupil loan servicing contracts. As of March 31, 2020, Nelnet was servicing $185.5 billion of student loans for 5.5 million borrowers below its contract, and Lakes which are Great was servicing $243.2 billion of pupil 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. Individually, Nelnet services $48.7 billion in FFELP, private education as well as consumer loans for 2.1 million borrowers that are not influenced by the Education Department’s decision.
What you must do next
If Nelnet or even Great Lakes service your federal pupil loans:
Do not panic.
Always keep making your regular monthly student loan payments to Great Lakes or even Nelnet.
You don’t need to use for a new pupil loan servicer.
The Education Department is going to assign you a brand new student loan servicer and often will communicate with you in advance of any change.
After you’re informed of your brand new student loan servicer, you can start sending pupil loan payments to your new student loan servicer.
As soon as that happens, ensure to update auto payments.
How to pay off student loans more quickly If you have pupil loans, make sure to end up with a game plan. What is the simplest way to pay off pupil loans quicker? Start with these four options, every one of which have no fees: