Nelnet And Lakes that are Great Will no longer Service Your Federal Pupil Loans

Nelnet And Great Lakes Will not Service Your Federal Pupil Loans

When Nelnet or Great Lakes service the federal student loans of yours, you may get a new student loan servicer.

Here’s what you need to know.

Student Loans
Great Lakes and nelnet, which are actually a component of the very same business and together service federal pupil loans for approximately 13 million pupil loan borrowers, can easily 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 student loan servicing. What is a pupil loan servicer? When you spend federal student loans, you do not spend the federal government or Department of Education directly. Instead, you pay the student loan servicer of yours, which collects the student loan payments of yours and provides customer support.

This’s another key step toward our dedication to improving customer service and holding the contractors of ours accountable for the performance of theirs, DeVos said. Pupils, parents, borrowers, as well as schools deserve a world class encounter when managing [Federal Pupil Aid], and I’m confident that FSA has employed the businesses with the knowledge, expertise and experience to deliver that.

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What Happened
On June 24, the Department of Education announced that Federal Student Aid – which provides more than $120 billion of financial aid to more than 68 million students across 5,800 postsecondary institutions every year – contracts that are signed with 5 student loan servicers to service federal pupil loans as well as 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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DeVos wants to streamline and simplify pupil loan repayment. Underneath DeVos’ brand new strategy, you could start making student loan payments by way of a centralized platform, studentaid.gov, as opposed to through the unique pupil loan servicer websites. DeVos believes the current pupil loan servicing platform lacks consistency and accountability, which hurts pupil loan borrowers.

Nelnet: We’re surprised We are shocked that the 2 highest rated servicers and also the dedicated employees that are liable for obtaining 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 the absence and this decision of transparency in the process and often will engage in every legal avenue available to make sure that pupils have the premium 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 student loans for 5.5 million borrowers below the contract of its, and Lakes that are Great was servicing $243.2 billion of student 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 education as well as customer loans for 2.1 million borrowers which aren’t impacted by the Education Department’s decision.

What you need to do next
If Nelnet or Great Lakes service your federal student loans:

Do not panic.
Always keep making your regular monthly student loan payments to Nelnet or even Great Lakes.
You do not have to apply for the latest pupil loan servicer.
The Education Department will assign you a brand new pupil loan servicer and can get in touch with you in advance of any change.
After you are informed of your brand new pupil loan servicer, you can start driving student loan payments to your new student loan servicer.
Once that happens, ensure to update car payments.
How to pay off student loans more rapidly If you have pupil loans, make sure to have a game plan. What’s the simplest way to pay off pupil loans faster? Begin with these 4 options, every one of which have no fees: