Nelnet And Great Lakes Will no longer Service Your Federal Pupil Loans
If Nelnet or perhaps Great Lakes service your federal student loans, you may get a new student loan servicer.
Here is what you need to know.
nelnet and Great Lakes, which are a component of the same company and together service federal pupil loans for around 13 million pupil loan borrowers, could 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 enhance pupil loan servicing. What is a pupil loan servicer? Whenever you spend federal student loans, you do not spend the federal government or Department of Education directly. Rather, you pay the student loan servicer of yours, which collects your student loan payments and supplies customer service.
This is another key step toward our commitment to improving customer care and holding our contractors accountable for the performance of theirs, DeVos said. Students, parents, borrowers, as well as schools deserve a world class experience when addressing [Federal Pupil Aid], and I am confident that FSA has employed the companies with the expertise, expertise and experience to provide that.
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On June twenty four, the Department of Education announced that Federal Student Aid – which provides greater than $120 billion of financial aid to greater than sixty eight million students across 5,800 postsecondary institutions per year – signed contracts with five pupil loan servicers to service federal student 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 Pupil Loan Corporation (Trellis Company)
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What you should Know About Your Pupil Loan Servicer
DeVos would like to streamline and simplify pupil loan repayment. Under DeVos’ new strategy, you may start making pupil loan payments through a centralized platform, studentaid.gov, instead of through the unique student loan servicer websites. DeVos feels the present pupil loan servicing platform lacks consistency and accountability, which hurts pupil loan borrowers.
Nelnet: We’re shocked We are surprised that the 2 highest rated servicers and the committed employees who are accountable for achieving those rankings will not be considered by the Department due to this contract, Nelnet CEO Jeff Noordhoek said. We are frustrated and disappointed by the absence and this selection of transparency in the process and often will pursue every legal avenue available to make sure 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 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 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 training and consumer loans for 2.1 million borrowers that are not impacted by the Education Department’s decision.
What you should do next
When Nelnet or even Great Lakes service your federal pupil loans:
Always keep making your regular monthly student loan payments to Great Lakes or perhaps Nelnet.
You don’t have to apply for a brand new pupil loan servicer.
The Education Department is going to assign you a new pupil loan servicer and will speak with you in advance of any transition.
As soon as 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.
When that happens, be sure to update car payments.
How to pay off pupil loans faster If you have pupil loans, make sure to have a game plan. What’s the easiest way to pay off student loans faster? Start with these 4 options, each one of which have no fees: