What Is a Student Loan Servicer and Why Should I Care?

repayment plan imageSo you took out a federal student loan and now it’s time to pay it back. I was in your exact position 2 years ago and even though I was working at Federal Student Aid, the student loan repayment process had me overwhelmed.

One of my first questions was: Why am I receiving federal student loan bills from a company rather than the U.S. Department of Education? If you have asked yourself a similar question, this may help:

What is a loan servicer?

A loan servicer is a company that handles the billing and other services on your federal student loans. So those bills you get in the mail? There is a good chance they are coming from a loan servicer on behalf of the U.S. Department of Education.

How do I find out who my loan servicer is?

To view information about all of the federal student loans you have received and to find contact information for your loan servicer, visit www.nslds.ed.gov and select “Financial Aid Review.” You will then be prompted to log in using your Federal Student Aid PIN, so make sure you have that handy.

Note: If you have multiple federal student loans, you may have more than one loan servicer, so make sure you click through each loan individually for information specific to that loan.

Why should I care?

There are lots of reasons you should care!  Among many other things, your loan servicer

Moral of the story: Keep in contact with your loan servicer.

The student loan repayment process can be confusing, especially if you’re new at it, but your loan servicer is there to help. Make sure you stay in touch with them and use the resources they have available for you.

Nicole Callahan is a new media analyst at the Department of Education’s office of Federal Student Aid.

4 Things to Do During Your Student Loan Grace Period

Grace 6 month 9 monthYour student loan grace period is a set amount of time after you graduate, leave school, or drop below half-time enrollment before you must begin repayment on your loan. For most student loans, the grace period is six months but in some instances, a grace period could be longer. The grace period gives you time to get financially settled and to select your repayment plan.*

Here are four things you can do during your grace period to prepare for repayment:

1. Get Organized

Start by tracking down all of your student loans. There is a website that allows you to view all your federal student loans in one place.

You can log into www.nslds.ed.gov using your Federal Student Aid PIN to view your loan balances, information about your loan servicer(s), and more.

Note: Don’t forget to check to see if you have private student loans.

2. Contact Your Loan Servicer

loan servicer is a company that handles the billing and other services on your federal student loan. Your loan servicer can help you choose a repayment plan, understand loan consolidation, and complete other tasks related to your federal student loan, so it is important to maintain contact with your loan servicer. If your circumstances change at any time during your repayment period, your loan servicer will be able to help.

To find out who your loan servicer is, visit nslds.ed.gov. You may have more than one loan servicer, so it is important that you look at each loan individually.

3. Estimate Your Monthly Payments Under Different Repayment Plans

Federal Student Aid recently launched a Repayment Estimator that lets you compare your monthly student loan payment under different repayment plans to help you figure out which repayment plan is right for you.

Just go to www.StudentLoans.gov –> Log in –> Click “Repayment Estimator” in bottom left corner. It will pull in all of your federal student loan information automatically so you can compare repayment plans based on your specific situation.

4. Select The Repayment Plan That Works For You

Although you may select or be assigned a repayment plan when you first begin repaying your student loan, you can change repayment plans at any time. Flexible repayment options are one of the greatest benefits of federal student loans. There are options to tie your monthly payments to your income and even ways you can have your loans forgiven if you are a teacher or employed in certain public service jobs. Once you have determined which repayment plan is right for you, you must contact your loan servicer to officially select a new repayment plan.

* Not all federal student loans have a grace period. Note that for many loans, interest will accrue during your grace period.

Nicole Callahan is a new media analyst at the Department of Education’s office of Federal Student Aid.

@FAFSA to Host First-Ever Bilingual #AskFAFSA Office Hours

On the last Wednesday of each month, Federal Student Aid (@FAFSA) hosts #AskFAFSA Office Hours, a live Q&A session on Twitter during which students tweet questions to the @FAFSA team and receive live answers from the experts. Each month, #AskFAFSA Office Hours focuses on a different topic related to financial aid. Past topics have included financial literacy, Back-to-School, and FAFSA Completion.

This month, Federal Student Aid has partnered with New Futuro to host our first bilingual #AskFAFSA Office Hours! The topic: Why FAFSA? Why Now?

Starting now, students and parents are invited to tweet their questions to us in English or Spanish using the hashtag #AskFAFSA. On March 27 at 5 p.m., you can follow the conversation live as our experts provide answers to your questions!* Not able to make the live chat? We’ll post a summary of the Q&A on our Storify page following the event.

*Answers will be provided by @FAFSA in English and @NewFuturo in Spanish.

Top 3 FAFSA FAQs

Completing the Free Application for Federal Student Aid (FAFSA) is the first step in accessing the more than $150 billion available in federal student aid. Since the 2013-14 FAFSA launched, there are a few questions we’ve seen popping up more than any others. Let’s go through them.

How can I complete the FAFSA if my parents or I haven’t filed my 2012 taxes yet?

FAFSA ImageYou CAN complete the 2013-14 FAFSA even if you or your parents haven’t filed your 2012 taxes yet. Here’s what you or your parents can do in your respective sections of the FAFSA:

  1. When the FAFSA asks: “Have you completed a 2012 income tax return?” Select “Will file.”
  2. Estimate income.
    • If your 2012 income is similar to your 2011 income, use your 2011 income tax return to provide estimates for questions about your income.
    • If your income is not similar, click Income Estimator for assistance estimating your adjusted gross income, and answer the remaining questions about your income to the best of your ability.
  1. After you file your 2012 tax return, go to www.fafsa.gov and correct your information.
    • Note: Once you complete your 2012 taxes, you may also be eligible to use the FAFSA’s IRS Data Retrieval Tool to automatically transfer your tax return information from the IRS into the FAFSA.

When is the FAFSA deadline?

States, schools, and the federal government each have their own FAFSA filing deadlines . It is important that you research all of these deadlines and complete the FAFSA by whichever deadline comes first. That being said, some types of financial aid are awarded on a first-come, first-served basis, so we recommend you complete the FAFSA as soon as possible in order to maximize the amount of financial aid you can receive.

Which FAFSA should I complete?

When you log into www.fafsa.gov, you will be given two different options: “Start a 2013-14 FAFSA” and “Start a 2012-13 FAFSA.” Which should you choose?

    • If you’ll be attending college between July 1, 2013 and June 30, 2014 select “Start a 2013-14 FAFSA.”
    • If you’ll be attending college between July 1, 2012 and June 30, 2013 select “Start a 2012-13 FAFSA.”
    • If you are applying for a summer session, or just don’t know which application to complete, check with the college you are planning to attend.

For more information about FAFSA, visit studentaid.gov/fafsa.

5 Reasons You Should Complete the Free Application for Federal Student Aid (FAFSA)

FAFSA January Free Logo

The new FAFSA for the 2013-14 school year is now available.

1. It’s the only way to gain access to the more than $150 billion available in federal student aid.

Completing the FAFSA is the first step toward getting federal aid for college, career school, or graduate school. Federal Student Aid provides more than $150 billion in grants, loans, and work-study funds each year, but you have to complete the FAFSA to see if you can get any of that money. Not to mention, many states, schools and scholarships also use the FAFSA to award financial aid, so every college-bound student should complete it.

2. It’s FREE!

The FAFSA is free to complete and there is help provided throughout the application. Several websites offer help filing the FAFSA for a fee. These sites are not endorsed by the U.S. Department of Education. We urge you not to pay these sites for assistance that you can get for free at the official FAFSA website: www.fafsa.gov.

3. It’s easier than ever.

We’ve done a lot over the past few years to simplify the FAFSA. One of the most exciting enhancements has been the launch of the IRS Data Retrieval Tool. The tool allows students and parents to access the IRS tax return information needed to complete the FAFSA, and transfer the data directly into their FAFSA from the IRS Web site, saving lots of time. This year, the IRS Data Retrieval Tool will launch in early February, so be on the lookout for that.

4. It only takes about 30 minutes to complete.

Given all the simplifications we’ve made over the last couple of years, the FAFSA now only takes about 30 minutes to complete. That’s probably less time than you spend watching your favorite TV show each week. And think of the benefits: spend 30 minutes completing the application and you could qualify for thousands of dollars in financial aid. Talk about return on investment.

5. More people qualify than you’d think.

If you don’t fill out the FAFSA, you could be missing out on a lot of financial aid! I’ve heard a number of reasons students think they shouldn’t complete the FAFSA. Here are a few:

    • “I (or my parents) make too much money, so I won’t qualify for aid.”
    • “Only students with good grades get financial aid.”
    • “The FAFSA is too hard to fill out.”
    • “I’m too old to qualify for financial aid.”

If you think any of these statements apply to you, then you should read “Myths About Financial Aid.” The reality is, EVERYONE should fill out the FAFSA! Don’t leave money on the table.

For information and tips on completing the FAFSA, visit StudentAid.gov/fafsa.

Nicole Callahan is a new media analyst at the Department of Education’s office of Federal Student Aid.

Get Your Financial Aid Questions Answered During #AskFAFSA Office Hours!

Tired of waiting in line at the financial aid office? Get your questions answered during #AskFAFSA Office Hours on Twitter!

OFFICE HOURS PROMOOn Wednesday, November 28th at 5:30pm ET, join @FAFSA as we host #AskFAFSA Office Hours live from the Federal Student Aid Fall Conference, where we will have a room full of financial aid professionals ready to answer your financial aid questions live on Twitter.

Here’s how it works:

  • Have questions about financial aid? You can start submitting your questions on Twitter today. Be sure to include the #AskFAFSA hashtag in your tweets. We will be accepting questions on Twitter from now through Wednesday.
  • On Wednesday, November  28th, at 5:30pm ET, follow @FAFSA or the #AskFAFSA hashtag on Twitter to join the conversation. We’ll be answering your questions live.
  • Can’t make the live session? A summary of #AskFAFSA Office Hours, including the full Q&A, will be posted on Storify following the event.

What Is a Loan Servicer and Why Should I Care?

Loan Servicer GraphicSo you took out a federal student loan and now it’s time to pay it back. I was in your exact position a year ago and even though I was working at Federal Student Aid, the student loan repayment process was overwhelming.

One of my first questions was: Why am I receiving federal student loan bills from a company rather than the U.S. Department of Education? If you have asked yourself a similar question, this may help:

What is a loan servicer?

A loan servicer is a company that handles the billing and other services on your federal student loans. The statement you receive in the mail is coming from a loan servicer on behalf of the U.S. Department of Education.

How do I find out who my loan servicer is?

To view information about all of the federal student loans you have received and to find contact information for your loan servicer, visit www.nslds.ed.gov and select “Financial Aid Review.” You will then be prompted to log in using your Federal Student Aid PIN, so make sure you have that handy.

Note: If you have multiple federal student loans, you may have more than one loan servicer, so make sure you click through each loan individually for information specific to that loan.

Why does it matter?

There are several reasons that being familiar with your loan servicer is important, including the fact that your loan servicer:

Moral of the story: Keep in contact with your loan servicer.

The student loan repayment process can be confusing, especially if you’re new at it like me, but your loan servicer is there to help. Make sure you stay in touch with them and use the resources they have available for you.

Nicole Callahan is a new media analyst at the Department of Education’s office of Federal Student Aid.