Note
Dec. 14, 2022 Update: We have completed the transfer of all PSLF borrowers from FedLoan Servicing to MOHELA. Borrowers should have received notice of the completion of their account transfer to their new servicer. Additionally, FedLoan Servicing’s contract with us has ended. If borrowers have any questions about their student loan account, including specific questions regarding PSLF, they should now contact MOHELA.
Aug. 22, 2022 Updates:
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We continue to transfer Public Service Loan Forgiveness (PSLF) borrowers from FedLoan Servicing to MOHELA, with over 50% of borrower accounts already fully transferred. If a borrower has not yet received notices from FedLoan Servicing or from MOHELA, the loans are still with FedLoan Servicing. All remaining transfer-eligible PSLF borrowers will complete their transfer from FedLoan Servicing to MOHELA by the end of September 2022. As a reminder, if a PSLF borrower’s loans are forgiven during this transfer time frame, the borrower will not be included in the transfers.
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We updated the second paragraph under What should borrowers expect during this transition? to accurately reflect the notifications a PSLF borrower will receive.
Beginning early this summer 2022, Federal Student Aid (FSA) will start transitioning the Public Service Loan Forgiveness (PSLF) Program, borrowers, and their loans from FedLoan Servicing to MOHELA. This change is required because FedLoan Servicing announced it will stop servicing federal student loans when its contract ends. This transition is expected to continue through the summer until the early fall.
Note: This change will not impact the existing terms, conditions, interest rates, loan discharge or forgiveness programs, or available repayment plans on the loans. It also will not change the temporary payment suspension and 0% interest benefits borrowers are currently receiving due to the coronavirus emergency.
For the most up to date information regarding this transition please visit StudentAid.gov/fedloan.
What should borrowers expect during this transition?
The first group of PSLF borrowers is expected to transfer from FedLoan Servicing to MOHELA in early July. The remaining borrowers will transfer through the summer. PSLF discharges for borrowers who meet all eligibility requirements will continue to occur during this transition timeframe. FedLoan Servicing will continue the servicing of any borrowers on their system until their loans are transferred.
We updated the PSLF borrowers can expect to receive three notices as their accounts are transferred so they may monitor their transfer progress. First, FSA will send an email to all current PSLF borrowers at FedLoan servicing in mid-June informing them of this transfer and what to expect. Next, borrowers will receive a notice of transfer from FedLoan Servicing at least 15 days before the transfer occurs followed by a welcome notice from MOHELA once the transfer is complete.
What else has changed which will impact borrowers because of this transition?
On May 1, 2022, FSA implemented several changes to prepare for the transition of the PSLF Program from FedLoan Servicing to MOHELA. These changes were put into place to minimize the number of borrowers who might otherwise be subjected to multiple servicer transfers. These changes include:
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Borrowers who are consolidating their loans via StudentAid.gov to take advantage of the limited PLSF waiver are now directed to select MOHELA as their new loan servicer. FedLoan Servicing is no longer an option.
Once MOHELA is selected, the borrower’s loans will be consolidated by Aidvantage, another member of FSA’s servicing team. Once Aidvantage completes the consolidation, the new loan will be sent to MOHELA for general servicing. If the consolidation is completed before July 1, 2022, MOHELA will be able to provide general servicing of the consolidation loan. After July 1, 2022, borrowers who consolidated for PSLF will be able to work directly with MOHELA regarding any questions about their PSLF status.
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For borrowers who submitted a PSLF form for the first time after May 1, 2022, and have yet to be transferred, these accounts will be transferred to MOHELA after July 1, 2022. FedLoan Servicing will continue to process PSLF forms and will identify borrowers for transfer to MOHELA. If a borrower’s PSLF form is incomplete or a borrower is deemed not eligible, FedLoan Servicing will reach out to the borrower with the status of their PSLF form. In such situations borrowers are encouraged to submit the necessary information to FedLoan Servicing to ensure the form can be processed.
After July 1, 2022, borrowers with submitted and complete PSLF forms will be transferred to MOHELA from their current servicer. Once transferred to MOHELA, borrowers will be able to create their online accounts with MOHELA and start checking on their progress towards PSLF. Please note, these transfers will be completed incrementally and not all information will be transferred or available immediately on July 1.
Contact Information
If you have general questions about the information in this announcement, contact:
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The Federal Student Aid Information Center (FSAIC) at 1-800-4FEDAID,
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FedLoan Servicing at 1-855-265-4038, or
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MOHELA at 1-888-866-4352.