Nelnet And Great Lakes Will no longer Service Your Federal Student Loans
If Nelnet or perhaps Great Lakes service the federal student loans of yours, you might get a whole new pupil loan servicer.
Here’s what you need to understand.
nelnet and Great Lakes, which are part of the same company and jointly service federal pupil loans for approximately 13 million student loan borrowers, can easily 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 spend federal student loans, you don’t pay the federal government or perhaps Department of Education directly. Instead, you pay the student loan servicer of yours, which collects the student loan payments of yours and offers customer support.
This’s another major step toward our commitment to improving customer support and holding our contractors accountable for their performance, DeVos said. Pupils, parents, borrowers, and schools deserve a world class experience when addressing [Federal Student Aid], and I’m confident that FSA has hired the companies with the know how, expertise and experience to provide that.
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On June twenty four, the Department of Education announced that Federal Pupil Aid – which provides greater than $120 billion of financial aid to more than 68 million students across 5,800 postsecondary institutions yearly – contracts that are signed with five pupil loan servicers to service federal student loans and also 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 and simplify pupil loan repayment. Underneath DeVos’ brand new strategy, you could start making pupil loan payments via a centralized platform, studentaid.gov, as opposed to through the individual pupil loan servicer sites. DeVos feels the current student loan servicing structure lacks consistency and accountability, which hurts student loan borrowers.
Nelnet: We’re shocked We are surprised that the two highest rated servicers and also the dedicated employees that are liable for obtaining those rankings won’t be considered by the Department for this agreement, Nelnet CEO Jeff Noordhoek said. We’re frustrated and disappointed by this choice and the absence of transparency in the process and often will engage in every legal avenue readily available to make sure that pupils have the good quality service they have 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 under 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 two optional six-month extensions through December fourteen, 2021. Separately, Nelnet services $48.7 billion in FFELP, private schooling and consumer loans for 2.1 million borrowers which are not influenced by the Education Department’s decision.
What you need to do next
When Nelnet or perhaps Great Lakes service your federal student loans:
Do not panic.
Keep making your regular monthly student loan payments to Nelnet or even Great Lakes.
You don’t need to apply for the latest student 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 change.
As soon as you are informed of your brand new student loan servicer, you can begin sending pupil loan payments to your new student loan servicer.
As soon as that happens, make sure to update car payments.
How to pay off pupil loans more rapidly If you have student loans, make sure to have a game plan. What is the easiest way to pay off student loans faster? Start with these 4 options, all of which have no fees: