One of the United States biggest student loan servicer’s (Navient), recently has been targeted for yet another major class action lawsuit. As the publications heat up many current and former student loan borrowers have been asking questions surrounding the Navient Lawsuit that can help guide them forward.
Can I change my student loan servicer?
Conventionally it’s not possible to change student loan servicer’s, but it is quite common for your loan servicer’s to change at least once in the life time of a individual student loan. This is due to the Dept. of Education transferring federal loans to ensure that student borrowers get the proper customer service and repayment options.
The first scenario that your loan servicer can change is through student loan consolidation. By consolidating with a Federal Direct Consolidated Loan your current student loans are combined into a single student loan. When consolidating your student loans you can choose between four student loan servicer’s: Nelnet, Navient, Great Lakes, and Fed Loan Servicing. After selecting a new loan servicer don’t hold your breath to long because there is no guarantee that the request you have submitted will be accepted.
If I have a student loan from Sallie Mae is it considered a government loan?
Originally, Sallie Mae was known as “Student Loan Marketing Association, established in 1972. Student Loan Marketing Association was a government-sponsored enterprise however, after 2004 they were privatized and congress eliminated Sallie Mae’s federal charter.
As of today, Sallie Mae is a publicly traded company that does not have any known connections with the federal government and only offers private student loans. Federal student loans can only be issued by the federal government; Sallie Mae student loans do not come from the government. Sallie Mae was a loan servicer for Federal Family Education Loan Programs (FFELP) and Direct Loan Programs before October 2014. Shortly after this period, Sallie Mae divided into two separate companies. The Student Loan Servicing side became “Navient” and Consumer Banking Business division became Sallie Mae.
Is it true that if I have private student loans no one will refinance me?
This is not true, You have the option to refinance both government and private student loans.
Take action, learn more about these different options:
- Student Loan Refinance
- Federal Student Loan Consolidation
- Income Driven Repayment
- Student Loan Forgiveness
I have a private loan and work as a teacher am I still qualified for teacher loan forgiveness?
Teachers that have federal Direct or Stanford loans are eligible to have up to $5000 forgiven, and up to $17,500 forgiven on secondary special needs, elementary, secondary math, and science teachers. However, private student loans are not eligible for Teacher Student Loan Forgiveness.
Am I still eligible for Income-Driven Repayment options if I’m unemployed?
Student borrowers that are unemployed also can be eligible for student loan forgiveness. If you have no income your student loan payment will be set at $0 a month. Student loan interest may not stop causing your principle to not decrease but after completing your term the student loan is complete forgiven and updated to paid on your credit with on-time credit history.
What happens if the Navient lawsuit is “won?” Do I get compensation?
Consumer Financial Protection bureau filed the lawsuit against Navient, which is a federal agency. Meaning, this lawsuit is not a class action suit and may or may not result in one. At this point, student borrowers who have loans serviced by Navient should not expect any compensation from the outcome.
Will I be billed with additional fees when paying off my student loans before the terms completion date?
Lenders are required to apply payments in the descending order:
When making an extra payment, lenders are permitted by federal regulations to apply a prepayment to future payments. If you would like your extra payments to be added to principle balances only send in written correspondence to servicer clearly stating your request. All federal and private student loans do not carry a prepayment penalty.