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

Nelnet And Great Lakes Won’t Service Your Federal Pupil 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 have to know.

Student Loans
nelnet and Great Lakes, which are actually a part of the very same business and collectively service federal student loans for around thirteen million pupil loan borrowers, could very well no longer 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 student loan servicer? When you pay out federal student loans, you don’t pay the federal government or Department of Education directly. Instead, you pay the student loan servicer of yours, which collects your student loan payments and offers customer care.

This’s another major step toward our commitment to improving customer service and holding our contractors responsible for their performance, DeVos said. Pupils, parents, borrowers, along with schools deserve a world class encounter when dealing with [Federal Pupil Aid], and I am confident that FSA has employed the organizations with the knowledge, experience and expertise 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 greater than sixty eight million pupils across 5,800 postsecondary institutions per year – contracts which are signed with 5 student loan servicers to service federal student loans as well as provide enhanced consumer 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 would like to streamline and simplify student loan repayment. Under DeVos’ new strategy, you could start making student loan payments by way of a centralized platform, studentaid.gov, instead of through the individual pupil loan servicer sites. DeVos feels the present student loan servicing structure lacks consistency and accountability, which hurts student loan borrowers.

Nelnet: We’re shocked We are shocked that the two highest rated servicers and the committed personnel who are accountable for getting those rankings will not be looked at by the Department due to this contract, Nelnet CEO Jeff Noordhoek said. We are frustrated and disappointed by the lack and this selection of transparency in the process and often will engage in every legal avenue available to ensure that students have the premium quality service they have come to expect from us.

In June 2009, the Education Department awarded Nelnet pupil loan servicing contracts. As of March thirty one, 2020, Nelnet was servicing $185.5 billion of student loans for 5.5 million borrowers under the contract of its, and Lakes which are Great was servicing $243.2 billion of student loans for 7.3 million borrowers under its agreement. These servicing contracts expire on December 14, 2020 with 2 optional six-month extensions through December fourteen, 2021. Individually, Nelnet services $48.7 billion in FFELP, private schooling as well as customer loans for 2.1 million borrowers that aren’t influenced by the Education Department’s decision.

The thing you should do next
If Nelnet or Great Lakes service your federal student loans:

Don’t panic.
Always keep making your regular monthly pupil loan payments to Great Lakes or even Nelnet.
You do not have to use for the latest student loan servicer.
The Education Department is going to assign you a new pupil loan servicer and often will get in touch with you in advance of any transition.
As soon as you’re informed of your brand new pupil loan servicer, you’ll be able to begin driving student loan payments to your new student loan servicer.
Once that happens, make sure to update auto payments.
How you can pay off pupil loans more rapidly If you have pupil loans, make sure to have a game plan. What’s the easiest way to pay off student loans faster? Begin with these four options, all of which have no fees: