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On Jan. 30, Navient declared that it has executed a legally-binding agreement to contract out the servicing of its remaining student loan portfolio, which consists of 2 7 million open accounts — to MOHELA in the second half of 2024.
Navient was one of the companies that serviced federal student loans by collecting and tracking payments. It stopped servicing federal direct student loans after Dec. 31, 2021. By that point, all federal loans in the Navient portfolio were transferred to another servicer called Aidvantage.
Since then, Navient has continued to act as a private student loan lender and service government-issued FFEL Program loans that are owned by private lenders.
Here’s what you need to know about switching to MOHELA if Navient is your private lender or current student loan servicer.
Are Navient and Nelnet the same? This question plagues countless student loan borrowers leaving them confused and uncertain about the entities managing their debt. While both companies play crucial roles in the student loan landscape, they differ significantly in their offerings and approaches. This comprehensive guide dives deep into the world of Navient and Nelnet, unveiling their unique characteristics and helping you navigate the complexities of student loan repayment.
Unveiling the Similarities and Differences:
Navient and Nelnet: These names likely ring a bell if you’re entangled in the web of student loan repayment Together, they manage the repayments for millions of borrowers, each with its own strengths and quirks
Navient: This behemoth handles both federal and private student loans, offering borrowers a diverse range of options. Its comprehensive loan management features, particularly for the privately-held Federal Family Education Loans (FFEL) it services, set it apart Additionally, Navient’s private student loan refinancing options provide borrowers with potential flexibility
Nelnet: This company, established in 1996, focuses solely on federal loans on behalf of the U.S. Department of Education and selected guaranty agencies. Nelnet shines with its customer service and support, often receiving positive feedback from borrowers. Its acquisition of Great Lakes Educational Loan Services, Inc. in 2018 further expanded its reach.
Key Differences:
Loan Management Features: Navient boasts unique features for managing FFEL loans and private student loans, including refinancing options. Nelnet, on the other hand, offers expanded Income-Driven Repayment plans for the Ed-owned federal student loans it services.
Customer Service and Support: Nelnet takes the crown in customer service, with its lower complaint rate compared to Navient. This could translate to a more pleasant experience for borrowers seeking assistance.
Navigating Dual Loans: Yes, it’s possible to have loans serviced by both Navient and Nelnet. However, juggling loans with both companies can complicate things, affecting your eligibility for specific forgiveness and repayment options.
Unseen Loans: If your Navient and Nelnet loans aren’t showing up on StudentAid.gov, don’t panic. It might just be a matter of time for the information to update. If the issue persists, contact your school or loan servicer directly.
Loan Types Offered: Both Navient and Nelnet service federal loans, but they don’t offer them directly. Navient also provides private student loan options and refinancing opportunities.
Landmark Shifts in Federal Student Loan Servicing: The Department of Education recently inked contracts with a fresh batch of student loan servicers, replacing Nelnet and Great Lakes. This move aims to elevate customer service and increase contractor accountability.
Impact on Borrowers: Changing servicers can impact how your loan is serviced and what repayment options you can access. Stay informed about these transitions to ensure a smooth experience.
Understanding Forgiveness and Repayment Options: Numerous forgiveness and repayment options are available, depending on your loan type and servicer. Staying well-informed about these options is crucial for maximizing your financial benefits.
Proposed Loan Cancellation Plans: President Biden’s executive order offers up to $20,000 in loan forgiveness for eligible borrowers. This plan, currently facing legal challenges, could provide substantial relief to those who qualify.
Income-Driven Repayment Plans: These plans tailor monthly payments to your income and family size, offering a more manageable repayment option. The recent one-time income-driven repayment waiver further eases the burden for eligible borrowers.
Public Service Loan Forgiveness: This program offers loan forgiveness for qualifying borrowers working full-time for a qualifying employer. It provides a path toward debt reduction and potential forgiveness for those dedicated to public service.
Tracking Your Loan Details: Keeping diligent track of your loan details is essential for making informed decisions about your repayment strategy and taking advantage of available forgiveness or repayment options. Spreadsheets and online tools can assist you in managing your loan lifecycle effectively.
FAQs:
Are student loans on Nelnet being forgiven?
Yes, student loans managed by Nelnet may qualify for forgiveness depending on the loan type and the repayment plan in use. Eligibility could stem from programs like President Biden’s student debt relief plan, income-based repayment plan forgiveness, or the new Income-Driven Repayment Waiver.
Why is my student loan being transferred to Nelnet?
The transfer of student loans to Nelnet is part of a broader strategy to enhance customer service and repayment assistance. This shift, coordinated by the U.S. Department of Education, aims to ensure borrowers have access to comprehensive resources for student loan management.
Whose student loans will be forgiven by Navient?
Navient is set to forgive the student loans of borrowers with FFEL Loans who work in public service or have been in student loan repayment for at least twenty years by December 31, 2022. This program provides substantial relief for those who have struggled with long-term student loan debt, offering an opportunity for these borrowers to make significant strides toward financial freedom.
Navient and Nelnet, while both major players in the student loan servicing arena, offer distinct experiences for borrowers. Understanding their differences and the ever-evolving landscape of student loan repayment is crucial for making informed decisions and maximizing your financial benefits. Whether you’re seeking comprehensive loan management features or exceptional customer service, choosing the right servicer can significantly impact your repayment journey. Remember, staying informed and proactive is key to navigating the complexities of student loan repayment and achieving financial success.
If you had federal student loans previously managed by Navient
If your federal loans were held by Navient prior to Dec. 31, 2021, they were most likely transferred to Aidvantange. You can confirm your current servicer by logging into your StudentAid.gov account. You can also get in touch with any of the loan servicer contact centers by calling 1-800-4-FED-AID.
Heres what your new federal student servicer can help you do:
- Register for online access to your account. You can speak with your servicer, view your monthly billing statements, and make bill payments once you have access.
- Enroll in autopay. Your bank account may be automatically withdrawn by your servicer as payment. Signing up for autopay will reduce your interest by 0. 25 percentage point.
- Sign up for income-driven repayment. By filling out a paper form with your servicer, you can request income-driven repayment, which caps your student loan payments at a percentage of your income (you can apply for IDR online on StudentAid). gov as well. ).
- Process deferment and forbearance requests. If you are eligible, your servicer can assist you in reducing the amount you pay or temporarily stopping payments. This helps you stay in good standing to avoid default. But interest can still rise during any delays or forbearance periods.
Process monthly payments and extra payments. Your servicer will track and collect your payments. You can direct your servicer to apply additional payments to your current balance by mail, phone, or online if you would like to make additional payments. Otherwise, it may apply the additional amount to next month’s payment instead.
You are likely to remain with Aidvantage unless you act to switch servicers. Use this tool to find out what might work for you.
If you have FFELP or private student loans currently managed by Navient
Private student loans and commercially held Federal Family Education Loan Program (FFELP) loans make up Navient’s student loan portfolio. According to a Navient representative, the company has $17 billion in private education loans and $38 billion in FFELP loans. If the deal goes through, Navient will retain ownership of the entire portfolio, though MOHELA will manage it.
Navient will contact impacted borrowers in the coming months with updates about the planned transfer to MOHELA. According to Navient, borrowers will maintain the same loan terms, interest rate, account number, and repayment schedule in addition to being able to use the same phone number and mailing address.
Prior to the transfer to MOHELA, Navient borrowers should do the following:
- Get a copy of your payment history from your servicer or download it and store it from your online account.
- Add your most recent address, phone number, and email address to your contact information.
It is also possible for borrowers with Navient-owned or commercially managed FFELP loans to combine them into a federal direct loan. Benefits from federal student loans, such as income-driven repayment (IDR) plans and loan forgiveness programs, become available through this process. Once you consolidate, your FFELP loan will be transferred to a federal student loan servicer. Consolidate your Navient FFELP loans by Apr. 30, 2024 in order to get credit towards loan forgiveness under the one-time IDR account adjustment.