Update: Federal student loan payment suspension has been extended through May 1, 2022.
The latest big news in student debt: Navient announced last week that it intends to cancel its servicing contract with the Department of Education (DoEd) and transfer its student loan portfolio to Maximus, which currently services defaulted federal student loans.
The DoEd still needs to approve Navient’s proposal, so it’s not a done deal quite yet — but signs point to all 12 million federal student loan borrowers in Navient’s portfolio being forced to make the switch before the end of this year.
Of course, Navient’s borrowers aren’t alone in this state of limbo. Both FedLoan and Granite State — which service a combined 10 million borrowers — announced over the summer that they won’t renew their federal student loan servicing contracts at the end of the year.
Yep, you did that math right: nearly half of the US’s 45.5 million total federal student loan borrowers are impacted by these servicer shakeups.
So what should you do if you’re among them? You’ll be assigned a new servicer automatically, and the DoEd has said they’ll notify you in writing once that happens. But with the end of the emergency federal student loan payment suspension scheduled right on the heels of servicer changes, plan to keep an eye on your loans to be sure nothing is lost in translation.
Here are four ways you can get ready for the switch:
- Make sure your contact info is up to date with your current servicer. If you’ve moved or have a new primary phone number or email address, now is the time to log into or contact your current servicer to update your details. Even though you’re parting ways, the DoEd and your new servicer will likely use the info on file with your current servicer to contact you.
- Get logged in to your new servicer ASAP. Once you’re assigned a new servicer, they’ll contact you with instructions for activating an online access account for their system.Take this step sooner rather than later so you can set up monthly auto-pay, review the status of your loans before your next bill is due, and confirm your personal details (which may include recertifying employment and income info if you’re enrolled in an income-driven repayment plan).
- Confirm your loans are still connected to FutureFuel.io. All of your connected loans display on your Roll Up dashboard, so be sure to check it out after your servicer switch is complete. And don’t worry — it will only take a few minutes to reconnect your loans if needed.
- Make a plan for January 31st. With so much commotion surrounding these student loan servicer changes, it’s easy to lose sight of the other major change that’s just around the corner for federal student loan borrowers. But the federal payment freeze is still set to end on January 31st, and it’s important to have a plan for how you’ll handle the return to repayment. Not sure where to get started? Take this quick quiz to get personalized recommendations.