The Ups and Downs of Dealing With Student Loan Organizations

How can you manage dealing with annoying student loan organizations?

You finally did it – you graduated from college! After years of hard work, you’ve earned your degree. But along the way, you racked up a sizable amount of student loan debt.

Now, you’re facing the daunting task of managing and repaying your student loans. Where do you even start?

Student loan organizations can be confusing, but getting a handle on your loans is critical for your financial future.

This article provides an overview of the ups and downs of dealing with major student loan organizations, tips for managing your student debt, and strategies for repayment.

Read Also: Student Loan Refinance Rates

The Major Student Loan Servicers

Downs of Dealing With Student Loan Organizations

If you have federal student loans, you’ll be making payments to a student loan servicing company contracted by the Department of Education.

These are the main services you might deal with:

1. Nelnet

This servicing giant handles over $400 billion in federal student loans for more than 10 million borrowers. They service Direct Loans, FFEL Program loans, and Perkins Loans.

2. Great Lakes Educational Loan Services

Great Lakes manages over $250 billion in federal student loans as another leading servicer.

In addition to Direct and FFEL loans, they service Parent PLUS Loans and consolidation loans.

3. Navient

Navient is a large student loan servicer that works with private and federal loans. They service Direct Loans, FFEL loans, and private student loans.

Around 6 million borrowers have their federal loans through Navient.

4. FedLoan Servicing (PHEAA)

FedLoan specializes in managing Public Service Loan Forgiveness (PSLF) and income-driven repayment plans for federal borrowers.

They handle Direct Loans, Stafford Loans, PLUS Loans, and consolidation loans.

5. MOHELA

The Missouri Higher Education Loan Authority services Direct Loans, Stafford Loans, PLUS Loans, and consolidation loans. They manage student loan accounts for nearly 7 million borrowers.

6. Aidvantage

Formerly known as EdFinancial Services, Aidvantage services over $200 billion in federal and private student loans. They handle Direct, Stafford, PLUS, and consolidation loans.

7. Edfinancial

Edfinancial works with federal Direct Loans, FFEL Loans, Perkins Loans, Health Professions Student Loans, and private student loans. They service loans for around 4 million borrowers.

8. HESC/ECMC

HESC (Higher Education Services Corporation) joined with ECMC (Educational Credit Management Corporation) to service student loans.

They handle over $41 billion in federal and private student loans.

Tips for Managing Your Student Loans

Dealing with student loan organizations can be frustrating. Here are some tips to stay on top of your student debt:

1. Consolidate Accounts

If you have multiple federal student loans with different servicers, consider consolidating them with the Department of Education into one Direct Consolidation Loan. This streamlines your repayment.

2. Enroll in Autopay

Most servicers let you enroll in autopay to have payments automatically deducted from your bank account each month. This saves time and ensures on-time payments.

3. Keep Records

Maintain detailed records of loan documents, correspondence with servicers, and payment history. This protects you if any issues arise.

4. Update Contact Info

To avoid missing important notices, keep your address, phone number, and email current with all your services. Many let you update online.

5. Contact Servicer ASAP With Issues

If you can’t make a payment or have other repayment problems, immediately contact your servicer.

They can explain options like deferments, forbearance, and income-driven plans. Ignoring issues leads to getting behind and possibly defaulting.

6. Consider Loan Consolidation

You can consolidate multiple federal student loans into one new loan with a single monthly payment through the federal Direct Loan program. This simplifies repayment.

7. Review Repayment Plan Options

Understand the differences between standard, graduated, extended, and income-driven repayment plans. Contact your servicer to switch plans if your circumstances change.

8. Ask Questions

Don’t hesitate to contact services if you’re confused about loan terms, notices you receive, repayment options, or any aspect of managing your loans. Ask questions and understand your full loan details.

Strategies for Tackling Student Loan Repayment

Here are some key strategies to stay on track as you begin repaying student debt:

1. Start Repayment Immediately

Don’t wait until the six-month grace period ends before beginning repayment. Even paying a little each month upfront saves on interest and gets you into budgeting for the payments.

2. Pay Extra Each Month

Pay more than the standard monthly amount. Extra goes directly to the principal, reducing the interest paid over the loan’s life.

3. Make Biweekly Half-Payments

Another way to pay down the principal faster is dividing your monthly payment in two and paying that amount every other week. This adds up to a whole extra month’s payment each year.

4. Pay Off Highest-Interest Loans First

If you have multiple loans, direct any extra payments to the ones with the highest interest rates first. This saves the most on interest fees.

5. Reevaluate Budget Priorities

Take an honest look at your budget and identify areas that can be temporarily trimmed to direct more cash flow towards student loans, like dining out, entertainment, shopping, etc. Every bit helps.

6. Look Into Employer Repayment Assistance

Find out if your employer offers student loan repayment help as an employee benefit. If not, advocate for adding this.

7. Research Loan Forgiveness Programs

If you work in public service or for a non-profit or government agency, see if you qualify for federal loan forgiveness after making payments for ten years.

8. Consider Refinancing

You can lower your interest rate with a private lender. Just be sure to research thoroughly and compare offers first.

9. Work Overtime or Extra Shifts

Pick up part-time gigs like rideshare driving, tutoring, freelance work, or side hustles to bring in cash for extra debt payments.

10. Automate Payments

Set up automatic monthly transfers from checking to savings to earmark cash for student loan payments. This removes the temptation to spend the money elsewhere.

Final Thought

The road to repaying student loans can feel long and rocky. However taking a proactive approach and understanding all your options can help you tackle the highs and lows you may face.

Also, using strategies like these can smooth the ride and help you reach the destination of a student debt-free future!