Nelnet And Great Lakes Will no longer Service Your Federal Pupil Loans
When Nelnet or even Great Lakes service your federal student loans, you might get a brand new pupil loan servicer.
Here’s what you need to know.
Student Loans
nelnet and Great Lakes, which are actually a part of the very same company and together service federal student loans for approximately 13 million student loan borrowers, may not anymore 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 out 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 offers customer support.
This’s another major step toward the commitment of ours to improving customer service and holding our contractors responsible for the performance of theirs, DeVos said. Students, parents, borrowers, along with schools deserve a world-class encounter when dealing with [Federal Pupil Aid], and I’m confident that FSA has employed the companies with the expertise, expertise and experience to give that.
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What Happened
On June twenty four, the Department of Education announced that Federal Pupil Aid – which provides more than $120 billion of financial aid to greater than 68 million students across 5,800 postsecondary institutions annually – signed contracts with five student loan servicers to service federal pupil loans and also deliver 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. Underneath DeVos’ brand new strategy, you could start making pupil loan payments through a centralized platform, studentaid.gov, instead of through the unique student loan servicer websites. DeVos thinks the present pupil loan servicing structure lacks consistency and accountability, which hurts pupil loan borrowers.
Nelnet: We are surprised We’re shocked that the 2 highest rated servicers and the dedicated personnel who are accountable for achieving those rankings will not be considered by the Department because of this agreement, Nelnet CEO Jeff Noordhoek said. We are frustrated as well as disappointed by this choice and the lack of transparency in the process and can pursue every legal avenue available to ensure 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 31, 2020, Nelnet was servicing $185.5 billion of pupil loans for 5.5 million borrowers below the contract of its, and Lakes that are Great 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 2 optional six month extensions through December 14, 2021. Individually, Nelnet services $48.7 billion in FFELP, private education and customer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.
The thing you should do next
If Nelnet or even Great Lakes service your federal pupil loans:
Don’t panic.
Always keep making your regular monthly pupil loan payments to Nelnet or even Great Lakes.
You don’t have to apply for the latest pupil loan servicer.
The Education Department will assign you a brand new student loan servicer and will communicate with you in advance of any transition.
Once you’re informed of your brand new student loan servicer, you can start driving student loan payments to your new pupil loan servicer.
As soon as that happens, ensure to update auto payments.
How you can pay off student loans faster If you’ve student loans, make sure to have a game plan. What’s the easiest way to pay off student loans faster? Begin with these 4 options, each one of which have no fees:
