Nelnet And Great Lakes Will no longer Service Your Federal Student Loans
When Nelnet or even Great Lakes service the federal student loans of yours, you might get a brand new pupil loan servicer.
Here’s what you need to know.
Student Loans
nelnet and Great Lakes, which are a component of the very same company and together service federal pupil loans for around 13 million student loan borrowers, could perhaps not 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 is a pupil loan servicer? If you pay federal student loans, you do not spend the federal government or perhaps Department of Education directly. Rather, you pay the student loan servicer of yours, which collects your student loan payments and provides customer service.
This is another key step toward our dedication to improving customer care and holding the contractors of ours accountable for their performance, DeVos said. Pupils, parents, borrowers, and schools deserve a world-class encounter when dealing with [Federal Pupil Aid], and I am confident that FSA has employed the companies with the expertise, experience and expertise to deliver that.
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What Happened
On June 24, the Department of Education announced that Federal Pupil Aid – which provides more than $120 billion of financial aid to greater than sixty eight million students across 5,800 postsecondary institutions each year – signed contracts with 5 student loan servicers to service federal pupil loans and provide enhanced customer 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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DeVos wishes to streamline as well as simplify pupil loan repayment. Under DeVos’ brand new strategy, you could begin making pupil loan payments via a centralized platform, studentaid.gov, instead of through the individual pupil loan servicer websites. DeVos believes the present pupil loan servicing platform lacks accountability and consistency, which hurts student loan borrowers.
Nelnet: We’re shocked We’re shocked that the 2 highest rated servicers as well as the dedicated employees who are responsible for achieving those rankings will not be considered by the Department because of this contract, Nelnet CEO Jeff Noordhoek said. We are frustrated as well as disappointed by this choice and the lack of transparency in the task and can engage in every legal avenue readily available to ensure that pupils 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 pupil loans for 5.5 million borrowers below the contract of its, and Great Lakes was servicing $243.2 billion of student 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 14, 2021. Individually, Nelnet services $48.7 billion in FFELP, private training as well as consumer loans for 2.1 million borrowers which are not impacted by the Education Department’s decision.
What you should do next
When Nelnet or even Great Lakes service your federal student loans:
Do not panic.
Always keep making your regular monthly pupil loan payments to Nelnet or Great Lakes.
You do not have to use for a new pupil loan servicer.
The Education Department will assign you a brand new student loan servicer and will speak with you in advance of any transition.
Once you are informed of your brand new pupil loan servicer, you’ll be able to begin driving student loan payments to your new student loan servicer.
Once that happens, ensure to update auto payments.
How to pay off student loans faster If you have student loans, be sure to use a game plan. What is the easiest way to pay off student loans faster? Start with these 4 options, each one of which have no fees: