In case you missed it, the U.S. Department of Education is making huge changes to the federal student loan servicing system next year. It’s part of Secretary Betsy DeVos’s Next Gen Federal Student Aid initiative, which aims to improve the borrowing and repayment experience. The system will become a single, centralized platform as early as December 2020 — when contracts end for current servicers like Nelnet and Great Lakes.
To replace the old servicers, five new companies will shoulder most of the federal student loan portfolio:
- EdFinancial Services
- F.H. Cann & Associates LLC
- MAXIMUS Federal Services Inc.
- Missouri Higher Education Loan Authority (MOHELA)
- Texas Guaranteed Student Loan Corporation (Trellis Company)
Here’s everything we know about the new federal student loan service companies
1. They’re supposed to be more accountable and easier to use.