Nelnet And Great Lakes Will not Service Your Federal Pupil Loans
If Nelnet or Great Lakes service your federal student loans, you might get a new student loan servicer.
Here’s what you have to know.
Great Lakes and nelnet, which are actually part of the same company and jointly service federal student loans for approximately 13 million pupil loan borrowers, could very well 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 pupil loan servicing. What’s a pupil loan servicer? Whenever you pay out federal student loans, you don’t pay the federal government or Department of Education directly. Rather, you pay your student loan servicer, which collects your student loan payments and supplies customer care.
This’s another key step toward our dedication to improving customer support and holding the contractors of ours accountable for their performance, DeVos said. Students, parents, borrowers, as well as schools deserve a world-class experience when managing [Federal Student Aid], and I am confident that FSA has hired the companies with the knowledge, expertise and experience to provide that.
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On June 24, the Department of Education announced that Federal Student Aid – which provides more than $120 billion of financial aid to more than sixty eight million students across 5,800 postsecondary institutions yearly – contracts that are signed with five student loan servicers to service federal pupil loans and also deliver 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 you should Know About Your Student Loan Servicer
DeVos wishes to streamline and simplify student loan repayment. Underneath DeVos’ brand new strategy, you might start making pupil loan payments through a centralized platform, studentaid.gov, rather than through the individual pupil loan servicer sites. DeVos believes the present pupil loan servicing platform lacks accountability and consistency, which hurts pupil loan borrowers.
Nelnet: We are surprised We are surprised that the two highest rated servicers and also the dedicated employees who are responsible for achieving those rankings will not looked into by the Department because of this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated and disappointed by this selection and the lack of transparency in the process and can pursue every legal avenue available to make sure that students have the high 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 pupil loans for 5.5 million borrowers below 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. Individually, Nelnet services $48.7 billion in FFELP, private schooling and customer loans for 2.1 million borrowers which 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.
Always keep making your regular monthly pupil loan payments to Nelnet or perhaps Great Lakes.
You don’t have to apply for a new pupil loan servicer.
The Education Department will assign you a brand new student loan servicer and can get in touch with you in advance of any transition.
After you are informed of your brand new pupil loan servicer, you’ll be able to begin driving student loan payments to your new pupil loan servicer.
As soon as that happens, make sure to update car payments.
How you can pay off pupil loans more quickly If you’ve student loans, ensure to have a game plan. What’s the easiest way to pay off pupil loans faster? Start with these four options, each one of which have no fees: