Nelnet And Great Lakes Will no longer Service Your Federal Student Loans
When Nelnet or Great Lakes service the federal student loans of yours, you may get a whole new student loan servicer.
Here’s what you have to understand.
Student Loans
nelnet and Great Lakes, which are a part of the same company and collectively service federal pupil loans for around thirteen million student loan borrowers, may no longer 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 boost pupil loan servicing. What’s 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 service.
This’s another major step toward the commitment of ours to improving customer service and holding the contractors of ours accountable for their performance, DeVos said. Students, parents, borrowers, and schools deserve a world-class experience when dealing with [Federal Student Aid], and I’m confident that FSA has employed the businesses with the expertise, experience and expertise to provide that.
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What Happened
On June 24, 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 – contracts that are signed with 5 student loan servicers to service federal student loans and deliver enhanced consumer 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 plan, you might begin making pupil loan payments via a centralized platform, studentaid.gov, as opposed to through the unique student loan servicer sites. DeVos believes the current student loan servicing system lacks accountability and consistency, which hurts pupil loan borrowers.
Nelnet: We’re shocked We are surprised that the two highest rated servicers and the committed personnel who are accountable for achieving those rankings will not looked into by the Department because of this contract, Nelnet CEO Jeff Noordhoek said. We’re frustrated as well as disappointed by this decision and the lack of transparency in the process and can pursue every legitimate avenue available to make sure that students have the premium quality service they’ve 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 student loans for 5.5 million borrowers below its contract, and Great Lakes 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 fourteen, 2021. Individually, Nelnet services $48.7 billion in FFELP, private training and customer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.
The thing you need to do next
If Nelnet or Great Lakes service your federal student loans:
Don’t panic.
Keep making your regular monthly student loan payments to Nelnet or Great Lakes.
You do not need to use for a new student loan servicer.
The Education Department is going to assign you a brand new pupil loan servicer and can get in touch with you in advance of any change.
As soon as you are informed of your new pupil loan servicer, you can start driving pupil loan payments to your new student loan servicer.
As soon as that happens, make sure to update auto payments.
How you can pay off student loans more rapidly If you’ve pupil loans, ensure to have a game plan. What is the easiest way to pay off student loans quicker? Start with these 4 options, each one of which have no fees:
