When it comes to federal student loans, your servicer is typically a private company that contracts with the U.S. Department of Education. Servicers handle the day-to-day activities associated with managing your federal student loans, like billing and crediting of payments. So, if you have a question about your account, want to change your repayment plan, get a forbearance or deferment, or apply for loan forgiveness, you need to know who your servicer is. And, if you aren’t happy with your servicer, you might be able to switch. (Find out how having student loans affects your credit score.)
Here’s what you need to know about student loan servicers and how to find out who services your loans.
The way that your loan is assigned a servicer depends on the type of federal student loan you have.
With Federal Direct Loans, students don’t get to choose their loan servicer. The U.S. Department of Education contracts with several different private servicers that manage Direct Loans.
Loans are assigned to one of these servicers when the loan is disbursed. If a student already has a Direct Loan, the Department of Education tries to send any new loans to the same servicer. Often, though, it’s not possible to assign all loans to the same servicer and students could end up with a different servicer for each loan.
Private servicers also service FFELs. But these servicers are different than Direct Loan servicers.
If you have a Perkins Loan, the school you attended is the lender and, usually, the servicer. Some schools contract with outside servicers.
During the life of your loan, the loan could be assigned to a different servicer. If you need to send your payments to a new address, both the new and the old servicers must send you a notice within 45 days.
The notice must state the following:
The new and old servicers can send you a combined notice instead of separate ones.
If you don’t like your servicer, you might be able to change it either through consolidation or applying for a statutory discharge.
Consolidating your student loans is when you combine multiple debts into a single loan. With a federal Direct Consolidation Loan, you can consolidate all, some, or one of your federal student loans. You have an opportunity to choose a new servicer for the consolidation loan in the loan application.
If you’re eligible for a statutory discharge or loan forgiveness program, like a disability discharge, closed-school discharge, or borrower defense to repayment discharge, you generally need to apply to the program.
Once you submit your application, your loan is transferred to the servicer for that program. For example, all loans that might eventually qualify for forgiveness under the Public Service Loan Forgiveness program are transferred to FedLoan Servicing once an Employment Certification Form is submitted. (Borrowers who are trying to qualify for forgiveness under this program should submit this form to the Department of Education annually and whenever changing jobs to help ensure they’re on track to receive forgiveness.) Also, Nelnet services all loans that are being considered for a disability discharge.
If you don’t know who your federal student loan servicer is, you can find out at StudentAid.ed.gov. You will need to create an FSA ID if you don’t already have one. Once you log in, you will see a numbered list of all outstanding loans and some data about the loans, like the amount disbursed and the current balance. You’ll need to click on the number to the left of the loan to see full information, which includes the name and contact information of your loan servicer.
Once you know the name of your servicer, you can find its website and create an account so you can make payments online. You should be sure to update your loan servicer about any changes in your name, address or phone number.
If you have questions about your bill, how payments are applied, or other questions about your loan, contact your servicer. You can get information about federal student loans in general on the U.S. Department of Education’s Federal Student Aid website.
If you need assistance in dealing with your servicer or need help understanding the different repayment, deferment, forbearance, and forgiveness options for federal student loans, consider consulting with a student loan attorney or debt negotiation attorney.
