Posted Date:January 10, 2013
| Author: | Jana Hernandes, Service Director, Operations, Federal Student Aid |
Subject: Loan Servicing Information - Federally-Owned Loan Transfer Initiative Planned for January - August 2013
We continue our efforts to improve the servicing of William D. Ford Federal Direct Loan (Direct Loan) Program loans and Federal Family Education Loan (FFEL) Purchased Loans, more simply referred to as federally-owned loans. In addition to managing the ever-growing portfolio of federally-owned loans as efficiently and effectively as possible, we are preparing for the forthcoming end to our contract with the Direct Loan Servicing Center (ACS). To ensure that affected borrowers are situated with new servicers prior to contract end, we plan to transfer the bulk of borrower accounts from the Direct Loan Servicing Center (ACS) to new servicers on an ongoing basis from January – August 2013.
This new transfer initiative for Direct Loans that are assigned to the Direct Loan Servicing Center (ACS) will occur simultaneously with the established transfers to Not-For-Profit (NFP) entities that have joined the federal loan servicer team. Through the new initiative, we will transfer an affected borrower’s Direct Loans that are currently assigned to the Direct Loan Servicing Center (ACS) to FedLoan Servicing (PHEAA), Great Lakes Educational Loan Services, Inc., Nelnet, or Sallie Mae.
During the January – February 2013 timeframe, we plan to primarily transfer the accounts of borrowers whose Direct Loans are in an in-school or an in-school deferment status.
During the February – August 2013 timeframe, we plan to primarily transfer the accounts of borrowers whose Direct Loans are in a status other than in-school or in-school deferment.
Note: The transferring of borrower accounts is a fluid process that does not always break out as neatly as outlined above. As a result, a loan in any status may transfer at any time during the initiative.
We have continuously refined and improved the transfer process so that each transfer is executed in a manner that is as orderly and smooth as possible for the affected borrowers. In the attachment to this announcement titled “Direct Loan Transfers – Direct Loan Servicing Center (ACS) to New Servicer,” we provide key information about the transfer process in question and answer format.
Contact Information
We appreciate the community’s ongoing support of our approach to servicing federally-owned loans. If you have questions about the initiative explained in this announcement, contact the new federal loan servicer directly. Contact information for the appropriate servicer can be found on the Loan Servicing Centers for Schools Contact Information page on the IFAP Web site.