ANOTHER major student loan provider Navient will no longer be handling debt because it has been a year and a half since the United States collected the last payments.
The Delaware-based company said on Tuesday that its six million borrowers would be transferred to Maximus, another government loan services company, pending “necessary approvals.”
Assuming the deal is finalized, that would mean Navient would become the third student loan manager to end his contract this year.
The other two to end their agreements include the Pennsylvania Higher Education Assistance Agency (PHEAA) and Granite State Management and Resources, affecting a total of 10 million student borrowers.
Now, a total of 16 million borrowers will be moved to new lending services.
This will leave President Joe Biden’s education department with the difficult task of not only transferring those borrowers, but also resuming payments for a total of 43 million borrowers in February.
In August, the Department of Education announced the “final extension” of the student loan hiatus until the end of January.
Since the onset of the coronavirus pandemic, the United States has put in place a pause on student loan repayments.
There has been growing pressure from Progressives and Democratic Senators Chuck Schumer and Elizabeth Warren to have Biden write off up to $ 50,000 in student debt for each borrower.
Many have claimed that Biden could write off $ 50,000 in student loan debt with a “stroke of a pen.”
While Biden has campaigned for the cancellation of $ 10,000 in debt for each borrower, he might not act on it.
The president was said to have become “suspicious” of the cancellation of the $ 10,000 loans.
Meanwhile, the Biden administration has written off a total of $ 8.7 billion in student loan debt for about 455,000 borrowers since taking office.
Many of those who did get help were people with total and permanent disabilities, totaling $ 5.8 billion.
The average student loan debt per borrower currently stands at $ 37,693, according to an EducationData report.
If you are with Navient
If you are affected by the loan transfer, expect to receive notice from your lender. You should also receive a welcome letter from your new repairer.
Also, keep in mind that a new loan provider may have different payment options.
But any major changes should be included in the welcome notice.
According to Navient, he plans to make the transition “smooth” as he moves away from servicing government loans.
We explain everything you need to know about student loan repayments.
Plus, learn how financial blogger Sahirenys Pierce and her husband have paid off over $ 99,000 in debt in five years.
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