Which Federal Loan Servicer is Best for Consolidating Your Loans

Choosing the right federal loan servicer for consolidation can be a daunting task, but it doesn't have to be. There are four main servicers to consider: Navient, Nelnet, FedLoan Servicing, and Great Lakes Educational Loan Services.

Each servicer has its own strengths and weaknesses, but the key is to find one that fits your needs. For example, Navient is known for its online tools and mobile app, making it a great choice for those who prefer digital communication.

Nelnet, on the other hand, offers a more personalized approach, with a dedicated customer service team that can help you navigate the consolidation process.

You can't request a new student loan servicer, but it's worth considering the pros and cons of each. For instance, some servicers have more complaints than others, with Navient having over 30,000 complaints, making it the worst in the CFPB's Complaint Database.

Not-for-profit servicers tend to have fewer complaints, with OSLA having only 45 complaints. MOHELA, a not-for-profit, has 546 complaints, the most among not-for-profits.

Here's a brief comparison of some federal loan servicers' complaints:

Loan consolidation can simplify your monthly payments by combining multiple loans into one loan.

This can make it easier to keep track of your student loans and help manage your finances. You can pay off all your smaller loans with one large Direct Consolidation Loan.

Not all federal student loans qualify for consolidation, so it's essential to check if your loans are eligible. You'll also reset any payments you've made towards student loan forgiveness if you take out a new Direct Consolidation Loan.

For example, if you're pursuing income-based repayment or Public Service Loan Forgiveness (PSLF), consolidating your loans might not be the best option. Refinancing might make more sense if you're not pursuing forgiveness.

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So, you want to know about federal loan servicers. Well, the government provides the education loan when you apply for federal student aid, but they don't deal with the loan afterward. That job is handed over to a loan servicer.

You'll be assigned a servicer by the U.S. Department of Education when you take out your loan. There are only a handful of student loan servicers to choose from, and you don't even get to pick anyway.

Loan servicers take your monthly payments and distribute them between your different loans. They also offer a variety of repayment options to make it easier to repay your student loans if you're having trouble making your monthly payments.

Here are some of the federal loan servicers:

Not-for-profits tend to have fewer complaints than for-profit student loan servicers in the CFPB's Complaint Database. The servicer with the fewest complaints listed is OSLA, with only 45 complaints.

If you're considering consolidating your federal loans, you'll need to understand the different federal loan servicers. There are several servicers to choose from, each with its own strengths and weaknesses.

Aidvantage, Central Research, Inc. (CRI), Edfinancial Services, MOHELA, Nelnet, and American Education Services are some of the federal loan servicers you may encounter. However, it's worth noting that some servicers, like FedLoan Servicing and Great Lakes, are no longer active and have been transferred to other servicers.

You can't choose a new servicer, but you can learn more about each of the servicers, including what they can do and how to contact them. Here's a brief overview of the federal loan servicers:

Keep in mind that the number of complaints can vary, and it's not always a reflection of a servicer's quality.

Federal Servicers are the companies responsible for handling your federal student loans after you've applied for aid. They're like the middlemen between you and the government, making sure your payments are made and your loans are serviced correctly.

There are several federal servicers, including Aidvantage, Central Research, Inc. (CRI), Edfinancial Services, MOHELA, Nelnet, American Education Services, Default Resolution Group, Heartland ECSI, and FedLoan Servicing (which is no longer active).

You might be wondering how you got assigned to a specific servicer - it's actually determined by the U.S. Department of Education when you take out your loan.

Here are some key facts about federal servicers:

Some federal servicers have more complaints than others, with Navient having the most at over 30,000 complaints. On the other hand, OSLA has the fewest complaints with only 45.

Navient is a student loan servicer that serves a massive 6,210,000 customers. They had a staggering 3,800 complaints registered with the CFPB, which translates to nearly 612 complaints per million customers.

This is one of the highest complaint rates among the four companies examined, and it's a major red flag. Navient's customer service is clearly not up to par.

The CFPB and five state attorneys general have filed lawsuits against Navient, accusing them of misallocating payments, encouraging borrowers to choose forbearance over income-driven repayment, and not being clear about how to re-enroll in income-driven repayment plans or remove a co-signer.

Navient maintains that the lawsuits cite new servicing standards being applied retroactively and they are not at fault. However, the sheer number of complaints and lawsuits suggests otherwise.

If you're considering Navient as a loan servicer, you may want to think twice.

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A deferment is an authorized temporary suspension of repayment that can be granted under certain circumstances. You must apply for it and meet the qualifications to get one.

While not required, you can continue making payments without penalty even if no payment is due. This shows that even though a deferment is not a guarantee, you still have the option to make payments.

Forbearance allows payments to stop temporarily or decrease in amount for a specific length of time. Your lender may grant forbearance of principal, interest, or both.

With forbearance, you are always responsible for repayment of accrued interest charges. This means that even if you're not making payments, interest is still building up.

Any unpaid interest will capitalize (or be added to your principal balance) at the end of the forbearance period (if not Perkins). This can make your loan balance higher than it was before.

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So you're trying to decide which federal loan servicer to choose for consolidation. One of the things you might want to consider is the number of complaints each servicer has.

Navient has by far the most complaints, with over 30,000. This is despite the fact that they have the smallest portfolio of the for-profit federal student loan servicers.

The not-for-profit servicers tend to have fewer complaints than for-profit servicers. In fact, OSLA has only 45 complaints, making it the servicer with the fewest complaints listed.

Here's a rough breakdown of the number of complaints each servicer has:

Keep in mind that the number of complaints is just one factor to consider when choosing a servicer.

Managing your loans can be overwhelming, especially if you have multiple loans to keep track of.

Consolidating your federal loans can simplify your monthly payments by combining multiple loans into one loan.

Having only one loan to worry about can make it easier to manage your finances and avoid missing payments.

Loan consolidation can also reduce the number of student loan servicers you need to deal with, making it easier to communicate with your lender.

By consolidating your loans, you'll only have to make a payment to one student loan servicer, which can help you stay organized and on top of your payments.

To find out who your student loan servicer is, you can visit the National Student Loan Data System (NSLDS) with your FSA ID.

Logging into the system requires an FSA ID, which you can create if you haven't already.

You should only create one FSA ID for yourself, and you cannot create one on behalf of someone else.

Be sure to keep your contact information up to date, so you'll be notified if your student loans change hands.

If your student loans do change hands, you'll only be notified if you have up-to-date contact information.

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