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FSA Announces Transfer Update on FedLoan Accounts

By Hugh T. Ferguson, NASFAA Senior Staff Reporter

Federal Student Aid (FSA) in a recent updated notice announced that the student loan servicer MOHELA will be servicing certain types of loans previously administered by FedLoan (PHEAA), which elected to not extend its servicing contract and is currently in the process of exiting the federal student loan portfolio.

“We have also determined that MOHELA will be the future servicer for borrowers in the Public Service Loan Forgiveness (PSLF) Program and the Teacher Education Assistance for College and Higher Education (TEACH) Grant Program,” FSA wrote in an updated announcement published Dec. 22, 2021. “All borrowers enrolled in PSLF and all TEACH Grant recipients will remain with FedLoan Servicing until they are transferred to MOHELA later in 2022.”

FSA also indicated that it would provide updates to this webpage in order to inform borrowers of impending details concerning loan transfers.

With the federal student loan payment pause now extended through May, the Department of Education (ED) has additional time to sort through administrative hurdles that could make resuming student loan repayment a bumpy process.

Stay tuned to Today’s News for more updates on the student loan system in the wake of the pandemic.

 

Publication Date: 1/4/2022


Jennifer A | 1/11/2022 3:47:07 PM

What about borrowers who would like to participate in the PSLF program but they've been transferred to a new loan servicer who isn't MOHELA. Say the borrower was under PHEAA, is now under NAVIENT; would these borrowers have the option to enroll in the PSLF program is they became eligible for it during the last 2 years?

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