Federal student loan servicers, such as Nelnet and Navient Corp., are companies that collect payments, respond to customer service inquiries and perform other administrative tasks on behalf of the U.S. Department of Education.
With this transaction, Nelnet/Great Lakes, Navient and FedLoan Servicing (PHEAA) become the three dominant student loan servicers who collectively service over $1 trillion of student loans. So what does this acquisition mean for your student loans? Here's what you need to know.
The Loan Servicer—Customer Service for Your Child's Student Loans. Nelnet is a federal student loan servicer working on behalf of the U.S. Department of Education, the government agency that lends you or your child student loans.
Navient was, at one time, the largest student loan servicer after Sallie Mae, its parent company, shifted its portfolio there in 2014. Navient ended its federal student loan servicing contract after December 2021 and its portfolio was transferred to Aidvantage.
If you have student loans owned by the U.S. Department of Education (ED), you now have a new loan servicer: Aidvantage.
You may qualify for student loan forgiveness of some or all of the balance of your loans if you perform certain types of qualifying employment and make a required number of qualifying payments.
If your loans are with Navient, you may qualify to have your private student loans canceled — but only if your account was delinquent seven straight months before June 30, 2021, and you live in one of the participating states.
To find out which company services your federal loans, log in to your studentaid.gov account, go to your account dashboard and scroll down to the section titled “My Loan Servicers.” Alternatively, you can call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243.
If you have not repaid your loan in full after you made the equivalent of 20 years of qualifying monthly payments, any outstanding balance on your loan will be forgiven.
Nelnet is a student loan servicing company contracted by the Department of Education to service direct and Federal Family Education Loans. Nelnet acquired Great Lakes Educational Loan Services in 2018, and together, the pair service more federal student loans than any other servicer.
Nelnet was not chosen as one of these servicers, and its contract with the federal government will end in December 2021. This means that if you currently have federal loans serviced by Nelnet, your loans will be transferred to another servicer in 2022.
Will Nelnet service all of my student loans? If you had multiple loans with FedLoan Servicing, all of them will transfer to Nelnet. It's possible you have other student loans serviced by another servicer.
If you had Navient federal student loans owned by the US Department of Education, your loans have moved to a new loan servicer. In 2021, Navient exited the federal student loan servicing industry, transferring its caseload of 5.6 million student loans to Aidvantage, which is owned by student loan giant Maximus.
Is Navient Federal or Private? While Congress originally created Sallie Mae to support the federal student loan program, it was eventually privatized. Navient is a private company that the U.S. Department of Education once hired to service its federal loans.
Navient was one of the largest federal student loan servicers prior to ending its contract after Dec. 31, 2021. Its loans were transferred to Aidvantage. Navient still services private student loans from various lenders.
Although Sallie Mae launched Navient, the two companies function as distinct and separate entities. Sallie Mae focuses on private student loans, while Navient services federal student loans as well as private loans.
These loans have been automatically placed into forbearance (payments suspended) until October and interest rates have been set to 0% according to the terms of the CARES Act passed by Congress. Your Auto Pay payments were paused automatically.
Pay As You Earn Repayment (PAYE)
Your remaining loan balance is eligible for forgiveness after 20 years of qualifying payments. You'll need to meet the following criteria to be eligible: You must have at least one eligible Direct Loan first disbursed on or after October 1, 2011.
For more than 40 years, Nelnet has helped students finance their education. That's why we are proud to offer private student loans through Nelnet Bank. These loans are for students needing to fill the gaps not met by federal financial aid, or who may be looking to refinance their student debt.
Student Loan Relief During the COVID-19 National Emergency
Student loan creditors can garnish your wages if you go into default. Whether your loan is a federal student loan or not dictates whether the creditor must first sue you in court, and how much it can garnish from your paycheck.
2. What's changing? Navient asked to end their contract to service federal student loans this year. The contract will run until December 2023, but the company is already transferring its loans to a new company — Aidvantage, which is the loan servicing division of a company called Maximus.
Navient: As of the end of 2021, all federal student loans serviced by Navient have been transferred to Aidvantage.
All federal loans in the FedLoan portfolio will be split up and transferred to other servicers including EdFinancial, MOHELA, Aidvantage (formerly Navient) and Nelnet. MOHELA will take on all borrowers enrolled in PSLF.