Federal student loans serviced by FedLoan (PHEAA) are being transferred in stages to several other services.
The transfers started last fall but the process is still ongoing. The transfers do not change anything about the loans. They will still be under the same terms, conditions, interest rates, loan discharge or forgiveness programs and available repayment plans.
As of now, there is a temporary payment suspension and 0% interest in place. The transfer does not change that.
The payment pause is scheduled to end on Aug. 31, 2022. According to CNET, Secretary of Education Miguel Cardona said in June that another moratorium extension is still possible.
“I don’t have any information now to share with you about when it would end or what the conversations are about when it’s going to be lifted,” Cardona said. “I know we have a date, and it could be that it’s extended. Or it could be that it starts there. But what I will say is that our borrowers will have ample notice.”
There has not been an official decision on broad student loan forgiveness. According to CNET, the student loan freeze halted payments and interest for 35 million Americans -- and collection efforts against 7 million borrowers currently in default.
What to expect when your loan is transferred
When student loans are transferred it just means another servicer will be handling the billing.
Here is what officials say you should expect during the process:
- You will receive an email or a letter from your assigned servicer to inform you about the transfer.
- You will receive a welcome letter from the new servicer after the new servicer receives your loans. This notice will provide you with the contact information for the new servicer and inform you of actions that you may need to take.
- All of your loan information will be transferred from your assigned servicer to your new servicer, but you may only be able to see online information that covers the period since your new servicer took your loans over.
- There will be no change in the terms of your loans.
- Your previous loan servicer and new loan servicer will work together to make sure that all payments you make during the transfer process are credited to your loan account with the new servicer.
After you receive the welcome letter from your new servicer, you should do the following:
- Begin sending your loan payments to your new servicer. If you use a bank or bill paying service to make your loan payments, update the new servicer’s contact information with the bank or bill paying service.
- Follow the new servicer’s instructions for creating an online account so that you can more easily communicate with the new servicer and keep track of your loan account.
List of federal student loan servicers
To find out who your loan servicer is, visit your account dashboard and scroll down to the “My Loan Servicers” section.
Or, you can call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243.
- If your servicer was Granite State, you’ve been moved to Edfinancial
- If your servicer was Navient, you’ve been moved to Aidvantage.
- If your servicer was FedLoan, you will be or have been moved to MOHELA, Aidvantage (loans serviced previously by Navient), Edfinancial, or Nelnet.
|FedLoan Servicing (PHEAA)||myfedloan.org||1-800-699-2908|
|Great Lakes Educational Loan Services, Inc.||mygreatlakes.org||1-800-236-4300|
|Default Resolution Group||myeddebt.ed.gov||1-800-621-3115 (TTY: 1-877-825-9923 for the deaf or hard of hearing)|
Borrows in default get ‘fresh start’
Good news for student loan borrowers who were in default.
According to a statement from the U.S. Department of Education, their accounts will be placed back into “good standing.”
Public Service Loan Forgiveness transferred
Starting this month, Public Service Loan Forgiveness (PSLF) borrowers will be transferred from FedLoan to MOHELA.
PSLF borrows will receive notices as their account is transferred. They will get a notice at least 15 days before the transfer occurs and a welcome notice from MOHELA once the transfer is complete.
PSLF discharges for borrowers who meet the eligibility requirements will continue to happen during the transfer timeframe. If your loans are forgiven during the transfer timeframe, you will not be included in the transfers.
If you submit a PSLF form for the first time after May 1, 2022, your form will be sent to MOHELA and processed after July 1, 2022.
Read: More education coverage