What You Need to Know


If you have a student loan serviced by FedLoan you may have heard that the company will be transferring its loans to other companies. What does that mean for you? The good news: You don’t have to do much. But the process can sure sound confusing, so it’s understandable if you have questions.

Keep reading for a breakdown of what you need to know.

Let’s discuss what a cosigner is and what their role is in the student loan process.

How to know who services your loan

First, a reminder of what a loan servicer is and what they do.

When your federal student loan is first paid out, the U.S. Dept. of Education assigns it to a servicer who handles the administrative part of the loan. This is not your lender — the company that actually provided the cash. The servicer handles tasks such as collecting and tracking your payments, helping with deferment or forbearance plans, and assessing if you’re eligible for any student loan forgiveness programs.

So, they’re important, but probably not a company you need to deal with that often.

What’s changing with my loan servicer?

If your loan is serviced by FedLoan Servicing, (also known as Pennsylvania Higher Education Assistance Agency or PHEAA) your loan will be transferred to a different servicing company. The company announced earlier in the year that it’s not extending its contract with the Dept. of Ed and effectively getting out of the federal student loan business.

Those loans still need servicing though, so the Dept. of Education is transferring them to other servicers. The loans will be divided up between MOHELA, Navient, EdFinancial, and Nelnet. Some of these companies weren’t announced until recently, so if you haven’t received word from them yet, you will soon.

By Dec. 31, 2022, these companies will take over servicing duties for their assigned loans. The good news is, that’s a year later than the original plan, so the transfer shouldn’t effect you while loan payments resume in January 2022. 

Note: Navient is going through some changes of its own. You can learn more about it, and get updates, here

What this change means for you

While this is a significant change, the actual impact on borrowers like you should be minimal.

You’ll be seeing mail coming from the new servicer instead of FedLoans. But it won’t affect your payment plan, interest rate, monthly payment amount, or any of the other pertinent loan details. Everything that’s changing is essentially happening behind the scenes.

But you will want to take one step to make sure the process goes smoothly for you — contact your new servicer to double-check they have the correct contact info (address, phone, and email) for you. You don’t want to miss out on important info because they’re sending updates to an email account you no longer check. You should also keep an eye on your payments to ensure they’ve been received and logged properly. It’s not likely to be a problem, but mistakes do happen and if you spot one, you’ll want to make sure it gets dealt with ASAP.

You should have been contacted by both the Dept. of Education and the new servicer regarding the transfer of your student loan. If you haven’t you can find out who your new servicer is you can go to the National Student Loan Data System, run by the U.S. Department of Education.

To access your info, you’ll need to provide your Federal Student Aid (FSA) ID number or use the password-reminder prompts on the site. Once you identify your new loan servicer, get in touch right away to make sure they have your correct contact info.

Learn about your new loan servicer

You may be wondering about this new company handling your loan. Understandable. We’ve got you covered there, too. We’ve got everything you need to know, including contact information, for EdFinancial, MOHELA, Navient, and NelNet.

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