Student Loan Servicers

Avoid Problems With Your Student Loan Servicers

Student loan servicers send you monthly statements, accept your payments, and are supposed to guide you to payment plans if you cannot afford your payments. They also report your payment history to the consumer credit reporting agencies. In other words, student loan servicers handle the nuts and bolts of student loans for the Dept. of Education and state lenders. A loan servicer will contact you to introduce itself after your loan is distributed to you and your school.

You cannot chose your loan servicer, or switch servicers. The Dept. of Education may change your loan servicer in the future. If the Dept. of Education reassigns your loan, your loan’s interest rate and repayment terms will not change.

Student Loan Servicer Abuse

Student loan servicers wield a great deal of power, and some use that power improperly. If you become delinquent with the federal loan, Congress gave the Dept. of Education and its loan servicers the right to garnish your wages administratively, in other words without a court hearing. They can also intercept your federal tax refund.

Student loan servicers are supposed to help borrowers in distress find payment options, such as deferment, forbearance, and income-based repayment plans. However, some federal student loan servicers make it difficult or impossible for borrowers to enroll in these plans, according to the Consumer Financial Protection Bureau, a watchdog government agency.

In December 2013, the CFPB said it would start overseeing the largest loan servicers in response to thousands of consumer complaints about their behavior. In particular, consumers complained the servicers failed to offer IBR programs, and misapplied extra payment amounts to the borrower’s lowest-interest loans.

Working With Your Student Loan Servicer

It is up to you, in part, to maintain a good relationship with your servicer. If you are still in school, contact your loan servicer when you:

• Change your name, address, or phone number
• Graduate
• Drop below half-time enrollment
• Stop attending school
• Transfer to another school

If you are no longer in school, contact your loan servicer when you:

• Change your name, address, or phone number
• Need help making your loan payment
• Have a question about your bill or loan

Contacting Your Student Loan Servicer

The following table contains all of the known federal student loan servicers:

Who Services Perkins Student Loans?

It is common for schools to service Perkins loans. However, if you receive a notice that the Dept. of Education is servicing the loan, contact the ECSI Federal Perkins Loan Servicer to learn more about your loan’s status.

If you believe a student loan servicer has treated you unfairly by denying you access to an IBR program, misapplied your payments, or garnished your wages improperly, complete the Dept. of Education's Self-Resolution Checklist (PDF) to learn what self-help steps you can take to resolve the situation. If you cannot work out a solution on your own, contact The Federal Student Aid Ombudsman Group of the U.S. Department of Education and the CFPB.