Posted Date:July 12, 2013
|Author:||Jana Hernandes, Service Director, Operations, Federal Student Aid|
Subject: Loan Servicing Information - Upcoming Federal Loan Servicer Team Changes
Earlier this year (January 10, 2013), we informed the financial aid community of our preparations for the forthcoming end to our contract with the Direct Loan Servicing Center (ACS). We explained that we would transfer the bulk of borrower accounts from the Direct Loan Servicing Center (ACS) to new servicers on an ongoing basis from January – August 2013. At this time, we want to share high-level information about the upcoming transition of all functions performed by ACS (now Xerox). In addition, we want to inform the community of an upcoming change in the servicing of newly-made traditional consolidation loans.
Direct Loan Servicing Center (ACS) Contract Ends – This change involves bringing closure to the servicer's day-to-day servicing of William D. Ford Federal Direct Loan (Direct Loan) Program loans. We will finish transferring the Direct Loans that remain on the servicer's system to FedLoan Servicing (PHEAA), Great Lakes Educational Loan Services, Inc., Nelnet, and Sallie Mae by August 29, 2013. The contact center will remain open for a short period of time after the transfers have been completed to support residual transition-related needs; we will provide contact center details in a subsequent communication.
Over the next several months, we will bring closure to the other functions performed by ACS (Xerox). Transition planning for all functions is in process. Prior to each function's transition, we will inform the community of pertinent information through Electronic Announcements posted on the Information for Financial Aid Professionals (IFAP) Web site. We will also ensure that affected borrowers are informed of transition-related changes that will affect them.
Below is the anticipated schedule for transitioning all functions performed by ACS (Xerox).
|Function Performed by ACS (Xerox)||Anticipated Transition|
|Servicing Teacher Education Assistance for College and Higher Education (TEACH) Grants||July 22 – 25, 2013|
|Managing Civil Legal Assistance Attorney Student Loan Repayment Program (CLAARP)||August 12, 2013|
|Servicing Direct Loans that remain on system||Ongoing through August 29, 2013|
|Servicing non-defaulted Federal Perkins Loans assigned to Department||Transition dates are being finalized|
|Managing debt management and collections system||Transition dates are being finalized|
|Managing Direct Consolidation Loan system||Transition dates are being finalized|
Nelnet Joins FedLoan Servicing (PHEAA) and Sallie Mae in Servicing Newly-Made Traditional Direct Consolidation Loans – This change involves adding Nelnet as one of three federal loan servicers to which we will assign all newly-made traditional consolidation loans for servicing on our behalf. Beginning August 5, 2013, we will assign newly-made traditional consolidation loans to FedLoan Servicing (PHEAA), Nelnet, and Sallie Mae. Upon assignment of a borrower's newly-made traditional consolidation loan, FedLoan Servicing (PHEAA), Nelnet, or Sallie Mae will correspond directly with the borrower.
We appreciate the community's ongoing support of our approach to servicing federally-owned loans. Please monitor the IFAP Web site for subsequent Electronic Announcements that will provide details related to the federal loan servicer team changes summarized in this announcement.