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(Loans) Subject: Loan Servicing Information - Second Year's Customer Service Performance Results and Third Year's Allocations

Posted Date:August 25, 2011

Author: Jana Hernandes, Service Director, Operations, Federal Student Aid

Subject: Loan Servicing Information - Second Year's Customer Service Performance Results and Third Year's Allocations

Note: In November 2015, we moved this announcement’s attachments to the FSA Data Center. The attachments for the Quarter Ending 6/30/2011 are now located on the Servicer Performance Metrics and Allocations page at

As explained in previous communications, Federal Student Aid awarded four new contracts in June 2009 to provide additional servicing capacity for loans owned by the Department of Education (the Department). These loans include William D. Ford Federal Direct Loan (Direct Loan) Program loans and Federal Family Education Loan (FFEL) Program loans purchased by the Department under the authority granted the Secretary in the Ensuring Continued Access to Student Loans Act (ECASLA) and through methods commonly referred to as a “PUT.”

Since September 2009, the Department began assigning federally-owned loans to these four federal loan servicers—FedLoan Servicing (PHEAA), Great Lakes Educational Loan Services, Inc., Nelnet, and Sallie Mae. Per our contractual agreement with each servicer, the Department will annually measure servicer performance in the areas of customer satisfaction and default prevention. We will then use these results to determine each servicer’s allocation of future loan volume.

This announcement is intended to share the second year’s customer service performance results and the third year’s allocations with the financial aid community. The Department measured customer satisfaction with each of the federal loan servicers exclusively through independently administered customer satisfaction surveys conducted through June 2011. We assessed default prevention through analysis of each servicer’s portfolio.

We provide this information in two attachments to this announcement. In the attachment titled “Explanation of Second Year’s Customer Service Performance Results,” we provide background information about the measures and a summary of the results. In the attachment titled “Final Calculation for Third Year’s Allocation,” we provide the customer satisfaction and default prevention results for each servicer and the allocation each servicer will receive in the third year.

We value the participation of all customers in the loan servicing process and thank you for your ongoing feedback.

Last Modified: 08/24/2011