FedLoan, also known as Pennsylvania Higher Education Assistance Agency, is one of the largest student loan servicers in the country.
What
This Means to Student Loan Borrowers
FedLoan
Servicing is an agency that manages billions of dollars in federal student
loans for close to nine million borrowers in the country. It’s also
responsible for the government’s Public Service Loan Forgiveness program.
If you’re one of the student loan borrowers
using FedLoan, your loans will be
transferred to a new servicer by the end of the year. You don’t have to apply
for a new student loan service provider. Currently, there are ongoing transfers
to MOHELA, another student loan
servicer. Federal Student Aid states that it will soon begin transfers to other
providers like Navient, Edfinancial and Nelnet.
The government has plans to help more student
loan borrowers get loan cancellations under the existing loan programs. They’re
also aiming at creating a loan repayment system that is simpler and more
transparent. Several initiatives are in place already, such as increased
accountability for student loan servicers and more oversight of
colleges.
Information about the transfer is particularly relevant for those pursuing the Public Service Loan Forgiveness. FedLoan is currently the only loan servicer that helps student borrowers get their student loans canceled through the program. If your student loan servicer is not FedLoan, the transfer will not affect you in any way.
What
Should You Expect?
You’ll receive a notice from the Department of Education regarding
the transfer. Your current servicer will also reach out to you before it
initiates the transfer. If you have any questions or need help after the
transfer, you can contact your new servicer.
It’s also important to note that even though a new agency will service your loans, pretty much everything will remain as it is. There will be no changes to your balance, interest rates, existing payment terms or the available repayment plans.
How to
Prepare for the FedLoan Servicing Transfer
There are a few steps you can take to make the
transition as smooth as possible.
Steps
To Take:
Keep
making payments: Even if your student loan servicer is
changing, continue making payments to your current servicer until you get a
confirmation that your transfer is successful.
Update your contact information: You need
to ensure your current servicer has all your contact information and that it’s
correct. This way, they can easily alert you about details of the transfer and
whether you need to take any actions.
Read
email from your servicer: Both your current and new servicers will
contact you. Make sure you carefully read all the information they send you so
you don’t miss out on anything important.
Save
copies of your payment history: You should save all your documents and
statements from your current servicer. Having them in print or PDF form is an
excellent way to ensure that all the information is accurate before and after
the transfer.
Set a reminder: You can also set a calendar reminder for the transfer date so you know when to log in to your new servicer’s website and confirm that your information is accurate.
Handling
Challenges during Transition
Some issues may arise as a result of the transfer. For
example, you may fail to receive a notice about the transfer. In this case, you
would need to contact both the current and new servicers and notify them about
the error
When you file a complaint or contact your servicer, keep a
record of the conversation. This should include the date and time as well as
the customer service representative you talked to. You should also keep all the
copies of letters, bills or emails you receive about your account.
The transition from one loan servicer to another can be a little rocky, especially since a lot of data is being transferred at once. But if you keep in touch with both servicers and carefully check all the information to ensure that everything is correct, you’ll likely have a smooth transition.
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