Nelnet And Great Lakes Will not Service Your Federal Pupil Loans
If Nelnet or Great Lakes service the federal student loans of yours, you might get a new student loan servicer.
Here’s what you have to know.
Student Loans
Great Lakes and nelnet, which are actually a component of the same company and jointly service federal student loans for around thirteen million pupil loan borrowers, may very well 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 is a student loan servicer? Whenever you pay federal student loans, you don’t pay the federal government or perhaps Department of Education directly. Rather, you pay your student loan servicer, which collects the student loan payments of yours and provides customer support.
This’s another key step toward our commitment to improving customer support and holding our contractors accountable for their performance, DeVos said. Students, parents, borrowers, along with schools deserve a world class encounter when managing [Federal Student Aid], and I am confident that FSA has employed the businesses with the expertise, expertise and experience to provide 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 68 million pupils across 5,800 postsecondary institutions per year – contracts that are signed with five student loan servicers to service federal student loans as well as provide 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 pupil loan repayment. Under DeVos’ brand new strategy, you may start making pupil loan payments by way of a centralized platform, studentaid.gov, rather than through the unique student loan servicer websites. DeVos feels the current student loan servicing structure lacks accountability and consistency, which hurts student loan borrowers.
Nelnet: We’re shocked We are shocked that the two highest rated servicers and also the committed employees who are liable for obtaining those rankings will not looked into by the Department because of this agreement, Nelnet CEO Jeff Noordhoek said. We’re frustrated as well as disappointed by this selection and the absence of transparency in the task and often will pursue every legitimate avenue readily available to ensure that students have the good 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 pupil loans for 5.5 million borrowers below the contract of its, and Lakes that are Great was servicing $243.2 billion of pupil loans for 7.3 million borrowers under its contract. These servicing contracts expire on December 14, 2020 with 2 optional six-month extensions through December 14, 2021. Individually, Nelnet services $48.7 billion in FFELP, private training as well as customer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.
What you must do next
When Nelnet or Great Lakes service your federal student loans:
Do not panic.
Always keep making your regular monthly pupil loan payments to Great Lakes or Nelnet.
You do not have to apply for a new pupil loan servicer.
The Education Department is going to assign you a new student loan servicer and often will communicate with you in advance of any transition.
After you are informed of your new pupil loan servicer, you can begin driving pupil loan payments to your new student loan servicer.
Once that happens, be sure to update car payments.
How to pay off student loans more rapidly If you’ve pupil loans, be sure to have a game plan. What is the easiest way to pay off pupil loans quicker? Start with these 4 options, each one of which have no fees:
