MyFedLoan Review

What is FedLoan Servicing? The basics

FedLoan Servicing is a nonprofit organization run by the Pennsylvania Higher Education Assistance Agency (PHEAA). Despite its association with the Pennsylvania-based agency, FedLoan Servicing handles loans nationally.

Under the current structure, there are eight federal loan servicers. The government assigns a servicer to you when you take out federal student loans.

This means you might have ended up with FedLoan Servicing if you have one or more of the following student loans:

  • Direct subsidized loans: These are need-based loans available to undergrads. The government covers interest charges while you’re in school, during your grace period and during any periods of deferment.
  • Direct unsubsidized loans: Undergraduate and graduate students are eligible for direct unsubsidized loans, regardless of their financial need. You’ll pay interest while loans are deferred, including while you’re still in school.
  • Direct PLUS loans: Graduate students and parents can qualify for PLUS loans — however, unlike with other direct loan programs, you can’t have bad credit. Interest isn’t subsidized with these loans.
  • Direct consolidation loans: These loans allow you to combine all of your federal loans into one loan with one servicer.

Your FedLoan Servicing loans may soon be transferred

Though the Department of Education has already started transitioning accounts away from FedLoan Servicing, this change will happen at different times for different borrowers. If you haven’t received a notification via MyFedLoans (and your new servicer) in 2021, your loan remains in place in 2022. It’s imperative that you stay current on your account regardless of if and when the loan is transferred.

Timeline of FedLoan Servicing transfersEducation Department announcement
Sept. 29, 2021Some borrowers will soon be transferred to MOHELA
Oct. 18, 2021Groups of borrowers will be transitioned to Navient (now Aidvantage), Edfinancial and Nelnet
Dec. 22, 2021Other borrowers will be moved to MOHELA, Aidvantage, Edfinancial and Nelnet

In December 2021, the Department of Education also announced that MOHELA would assume FedLoan’s role in servicing borrowers who are pursuing Public Service Loan Forgiveness and TEACH Grants.

Using the MyFedLoan platform to manage your loans

If FedLoan Servicing is still your loan servicer, using the MyFedLoans platform is the easiest way to:

  • Make payments
  • Track your loan repayment progress
  • Get information about forgiveness options
  • Download the forms needed for deferment and forbearance, forgiveness and discharge, the TEACH grant and more

How to make payments to FedLoan Servicing

You can make student loan payments in the following ways:

  • Direct debit: You can link a checking or savings account to your FedLoan Servicing account. The company will automatically withdraw your payment on the same day each month. As an added benefit, signing up for automatic payments can reduce your interest rate by 0.25%.
  • App: Use the app to send your payments or make extra payments on your loans. You can also use the app to view your balance and get other information on your loan.
  • Website: You can manually make one-time payments through the site.
  • Phone: FedLoan Servicing has an automated phone line you can call at any time to make payments. Dial 800-699-2908 and have your loan account number and bank account routing number ready.
  • Mail: If you prefer, you can mail a check or money order to the company. Mail your payments to: U.S. Department of Education, FedLoan Servicing, P.O. Box 790234, Louis, MO 63179-0234.
  • Third-party servicer: You may choose to use a third-party bill payment servicer or schedule payments through your bank. However, FedLoan Servicing notes on its website that they don’t have the ability to offer interest rate reductions or other incentives for auto payments set up by a third party, so the direct debit program may be a better choice.
  • Advance payments: You may set up advance payments up to 60 days in the future, for a maximum of eight advance payments per month. You can schedule these advance payments directly through the website.
  • Targeted payments: FedLoan Servicing allows you to target extra payment amounts to specific loans, as long as you pay the minimum amount due on each loan. Making extra payments on your loans may reduce the amount of interest you pay overall and could save you money over the long term.

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