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Know Your Servicer

Who is lending you the money, and who are you paying back?

For some private loans, you pay the school directly. For most loans, though, your loan servicer is a third-party company that pays the loan to your school, and you repay your loan to this company directly. Before payments are due, you should be aware of who your loan servicer is by checking your promissory note, contacting the financial aid department at your school, or checking with the National Student Loan Data System.

Ask for Specifics

Your servicer can answer important questions. When are payments due? How much are my payments? How much interest am I being charged? Ask them any other questions you have on loan specifics, as the more you understand with your loan, the less intimidating the process will be.

Keep Your Contact Info Up-to-date

It’s also mega important that your servicer has your current contact info on file to avoid delays in contacting you with relevant updates and changes. A simple phone number update can avoid miscommunication that turns into a missed payment that results in a negative mark on your credit report. Your servicer can also assist with setting up your online account to help you self-manage your profile and become familiar with your loan cycle.

List of Possible Federal Student Loan Servicers

Aspire Resources Inc. 1-800-243-7552

CornerStone 1-800-663-1662

Ed-Financial 1-855-337-6884

FedLoan Servicing (PHEAA) 1-800-699-2908

Granite State—GSMR 1-888-556-0022

Great Lakes Educational Loan Services, Inc. 1-800-236-4300

MOHELA 1-888-866-4352

Navient 1-800-722-1300

Nelnet 1-888-486-4722

OSLA Servicing 1-866-264-9762

VSAC Federal Loans 1-888-932-5626*

*Please note that VSAC recently requested to discontinue operating as a federal loan servicer. 

Accrued Interest — Interest that has accumulated on a loan but has not yet been paid.

Capitalized Interest — The amount of accrued interest that is added to the loan balance resulting in a new (higher) balance.

Consolidate — Combining multiple loans into a single loan with a single payment.

Default — The failure to repay a loan according to the terms agreed to in the promissory note. May result in legal action, including wage and tax seizure.

Deferment — A set time for a temporary postponement of loan payments. Does not always postpone interest.

Delinquency — A loan status for overdue payments. Extended delinquency can result in loan default.

Discretionary income — The amount after taxes and living expenses used as qualification for some repayment plans.

Forbearance — An option to temporarily suspend or reduce loan payments.

Garnishment — A legal course of action for a percentage of money to be withheld from a borrower’s paychecks, tax refunds, and Social Security Income (SSI) and applied towards student loan repayment.

Grace period — The set amount of time after you graduate, withdraw, or drop below half-time enrollment before you must begin loan repayment. Not all loans have grace periods, but for most federal student loans, the grace period is six months. Confirm with your servicer.

Interest — The cost of borrowing money that is added to the loan based on the rate of the original loan amount.

Interest rate — A set percentage of loan principal that calculates the amount of interest due.

Loan rehabilitation — The recovery of a defaulted loan through required payments over a specific time that reinstates the loan to good standing. Also reinstates loan repayment and postponement benefits.

Loan servicer — Companies that disburse, manage and collect payments on a loan.

Promissory note — A legal document stating the terms of a loan that is agreed to by all involved parties.

Subsidized — A type of student loan that the government partially or temporarily pays the interest that accrues.

Unsubsidized — A type of student loan that accrues interest as soon as the loan is disbursed-including while students are enrolled in school.