One of the top student loan servicers in the country, Navient, announced today that it won’t be managing your federal student loans for very long. Navient said:
As we continue to place our focus on areas other than government student loan servicing, Navient President and CEO Jack Remondi said, “Navient is pleased to work with the Department of Education and Maximus to provide a smooth transition to borrowers and Navient employees.” Maximus will be a fantastic partner to make sure that taxpayers and the government are well-served, and we are anticipating FSA approval. ”.
There’s a good chance that Navient is the company responsible for servicing your student loans if you have any. For approximately 12 million borrowers of student loans, Navient provides services for student loans, parent loans, and FFELP Loans. What this significant announcement means for your student loans is as follows:
Navient will no longer service your student loans
If the U. S. If the Department of Education approves this contract novation, Navient will no longer serve as the company that services your student loans. This indicates that you will no longer make payments to Navient for your student loans, subject to approval. You won’t need to get in touch with Navient if you have a question about your student loans, need to sign up for an income-driven repayment plan, or need to recertify your income to qualify for student loan forgiveness. You shouldn’t be alarmed if your student loan servicer switches during the course of your repayment period because this happens frequently.
Maximus may become your new student loan servicer
Subject to approval from the U. S. Your new student loan servicer may be the Department of Education or Maximum. Currently, Maximus services 7. There are 1 million borrowers of student loans with a total debt of $166 billion. If accepted, you would begin using Maximus to pay your student loans. If Maximus is rejected by the Education Department, you might be given a different student loan servicer. You will still be qualified for all federal student loan benefits, such as forbearance, deferment, student loan forgiveness, and loan forgiveness for public service if you have federal student loans and your loan servicer changes. (Here are 17 ways to fix student loan forgiveness).
The U.S. Department of Education will notify you of next steps
When your student loan servicer changes, the U. S. Your new student loan servicer will be disclosed to you by the Department of Education. Don’t worry, this won’t cost you more money or require you to figure out what to do next. Your new student loan servicer’s information, contact information, and instructions on when to begin making payments should be sent to you by the Education Department. Make sure to update your contact information and banking information for autopay once directed if Maximus becomes your new student loan servicer.
This is a good time to review student loan repayment
Your student loans should not be significantly impacted, if at all. The process should all take place behind the scenes. The only significant change is that, if approved, you will now pay your student loans through Maximus rather than Navient. That said, student loan relief is ending January 31, 2022. This indicates that beginning on February 1, 2022, payments for federal student loans will once again be due. Now is a good time to reassess your options and repayment plan for student loans after a 22-month break. Should you use income-driven repayment, public service loan forgiveness, refinance your student loans, pay them off sooner?
Here are some well-liked strategies for reducing student loan debt:
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FAQ
How do I know if my Navient student loan will be forgiven?
The Navient Settlement does not require borrowers to apply in order to have their loans forgiven. There isn’t a “Navient Settlement Application. You’ll receive a letter from Navient by July 2022 that looks something like the one below outlining which of your loans will be forgiven.
What is going on with Navient student loans?
The total amount of the settlement with Navient is $1, and it specifies who will have their debt cancelled. 85 billion. The majority of that amount—or about $1. 7 billion in forgiveness—will cover the price of wiping out the remaining balance on about 66,000 borrowers’ subprime private student loan balances.
How do I know if Navient will cancel my debt?
Navient will notify some private loan borrowers that their qualifying private loan has been canceled and that the tradeline associated with the loan will be removed. (Information about a consumer account sent to credit bureaus is known as a tradeline.)
Are payments to Navient suspended?
According to the terms of the CARES Act, which was passed by Congress, these loans have automatically been put into forbearance (payments have been suspended) until October, and interest rates have been set to 0%.