<p>What the heck? I thought all this stuff was moved completely back to the federal government. Private lenders are still administrating them until 2014? Do I have any say about this or is it region or school specific? Can I opt out of having them administer the contract? Would I need to go to a completely different school or area of the country to get away from them and back to true Direct Loans administered by the gov?</p>
<p>All loans are now through the government, but the government has contracted with several companies to service the loans … and SallieMae is one of the servicers. Students are assigned a servicer randomly, and if you get assigned SallieMae, that will be your servicer for all Direct Loans.</p>
<p>I hope you’re not just taking Sallie Mae’s word for it.</p>
<p>First, it’s all Direct Loans which I would hope would come from the government. You can still get private loans from whomever you want.</p>
<p>And second, how is what you’re talking about any different than how things were during the past decade? It was government loans being administered by private companies with those private companies making money for doing so. And how does the “2014 changeover” affect this arrangement with the new law?</p>
<p>Ben:</p>
<p>Kelsmom is one of cc’s resident experts on finaid. What she posts you can rely on.</p>
<p>Kelsmom answered your question already The Dept of Educ does not have the manpower nor expertise to make/service loans. Thus they contract it out to various bidders. In addition to Sallie Mae, ACS is another big contractor that gets paid to service the federal loans. The servicers just get a fee to process paper and keep track and report back to the feds. All servicers/contractors must follow the any new laws and regs.</p>
<p>That’s right … it’s SallieMae, ACS, PHEAA, Nelnet, and Great Lakes Educational Loan Services who are the servicers (5 - I was thinking it was 4, but I am looking at my servicer print out hanging on my cubicle wall as I type this). They are paid to service the loans that are originated through & guaranteed by the federal government.</p>
<p>O.k. Here’s the info. Clearly the student Direct Loan reform was way over hyped. These four private companies have now cornered the market. While they don’t keep the interest and fees, they are now the sole paid contractors for all new Direct Loans. It’s clearly a sweeter deal, since many public universities used to administer the loans themselves. Reminds me a bit of the health care reform (more customers without a public option!) and wouldn’t surprise me if the DL reform was co-written by Sallie Mae. While technically the implementation of the law was supposed to be 2014, it’s been immediately changed over with no lag.</p>
<p>Loan Servicer Contact Information</p>
<p>Students and parents who first borrowed Federal Direct Loans prior to July 1, 2010 should continue to have all of their Federal Direct Loans serviced by the Direct Loan Servicing Center at this time.</p>
<p>Direct Loan Servicing Center (ACS)</p>
<p>800-848-0979 [WWW.DL.ED.GOV</a> redirect page](<a href=“http://www.dl.ed.gov/]WWW.DL.ED.GOV”>http://www.dl.ed.gov/)</p>
<p>Students and parents who first borrowed Federal Direct Loans after July 1, 2010 will have their Federal Direct Loans serviced by one of the four servicing contractors listed below:</p>
<p>FedLoan Servicing (PHEAA)</p>
<p>800-699-2908 [FedLoan</a> Servicing](<a href=“http://www.myfedloan.org/]FedLoan”>http://www.myfedloan.org/)</p>
<p>Great Lakes Educational Loan Services, Inc</p>
<p>800-236-4300 <a href=“http://www.mygreatlakes.org/[/url]”>http://www.mygreatlakes.org/</a></p>
<p>Nelnet</p>
<p>888-486-4722 [Student</a> loan products and services ::: Nelnet](<a href=“An error has occured”>http://www.nelnet.com/)</p>
<p>Sallie Mae</p>
<p>800-722-1300 <a href=“http://www.salliemae.com/[/url]”>404;
<p>Didn’t see your other posts.</p>
<p>Is ACS a private contractor or are they just the federal government?</p>
<p>ACS is a private for-profit and was, not surprisingly, just purchased by Xerox.</p>
<p>[FinAid</a> | Health Care and Education Reconciliation Act of 2010](<a href=“Your Guide for College Financial Aid - Finaid”>Your Guide for College Financial Aid - Finaid)</p>
<p>The services fees paid to these five companies are one-third less per account compared to previously privately-administered ones… which not all Direct Loans were prior to the reform. So the government is saving about 33% on servicing fees when comparing select FFELP formerly privately-administered accounts to the ones now. But now you cannot be serviced directly by the government, as I was before on my undergrad loans, and these five companies control the ENTIRE DL servicer market. Seems like a sweet deal for them! It would not surprise me if Sallie Mae helped write the bill in the first place. </p>
<p>The only bright point in all this seems to be the student surveying system, which will result in increasing and decreasing allocation of accounts to these servicers depending on performance in coming years. I still think this is clearly a racket. It’s the same thing with the intelligence community and the military: if they weren’t paying out to private contractors, they could hire the staff to do it themselves with proper accountability and government works who have sworn an oath. It starts with a law and allocation of funds to the contractors, which then results in reductions of staff. Not the other way around.</p>
<p>Sallie Mae really screwed over a number of my friends when they were in-cahoots with the for-profit-university corporations around the country giving kick-backs to financial aid counselors. I really wanted nothing ever to do with them. I’m disappointed that Obama-Pelosi let this happen.</p>
<p>It is disappointing in that you cannot choose your servicer. Each of my kids has a small loan in order to have “skin in the game.” My D has a FFELP loan & I love the company she deals with. My S has a DL loan from this year, and I am not thrilled with his servicer (I have dealt with them, plus I don’t like their student web setup). We have not received any surveys yet as clients for this servicer.</p>