Aidvantage vs Navient: All You Need to Know

It’s fair to say that the Department of Education is bleeding businesses willing to collect federal student loan repayments. On September 28, 2021, Navient announced its desire to exit the federal student loan business and transfer its 6 million borrower accounts to a company called Maximus.

The announcement follows FedLoan Servicing’s announcement a few weeks earlier, which also called for an exit from government student loans. With over 40 million student loans set to be repaid on May 1, 2022, nearly two years will have passed without payment or interest.

Shifting nearly half of the federal student loan portfolio to startups is likely to cause service errors, headaches, and anxiety. However, borrowers who pay close attention to things like this need not worry, for reasons I’ll explain. We explain what to do if Navient is your service provider, as well as possible reasons why Navient has decided to stop servicing federal student loans and what this means for you.

Reasons Navient Quit the Federal Student Loans Servicing

Imagine you are using Navient and looking at your sources of income. You can see that servicing government student loans is 5-10% of your income (which is okay, by the way).

  • Over 90% of their negative headlines come from this business line.
  • More than 90% of lawsuits against your business come from the processing of student loans.
  • The Department of Education recently authorized states to begin monitoring their activities, which would require the hiring of significantly more legal and enforcement assistance.
  • You have to hire hundreds, if not thousands, of new low-wage call center representatives, even though many of his prospects have better job opportunities elsewhere due to labor shortages induced by the crisis. pandemic.

Now add to all the points above that Navient isn’t very good at servicing federal student loans. Anecdotally, out of most complaints from Student Loan Planner readers, I would rank the service providers as follows:

  • FedLoan (most)
  • Navient
  • Nelnet
  • Great Lakes (less)

Based on the issues above, it’s clear why Navient wants to get out of the federal student loan market.

Should I Be Worried About Navient Quitting?

If you’re reading this article, don’t worry about Navient ending servicing of federal student loans. I’m concerned about borrowers, who are less information-hungry and learn reactively rather than prepare proactively. You will see many articles asking you to download your payment and credit information from the Navent website.

I agree you should. But even if you forget it, you don’t have to worry. The NSLDS file is really what matters, not the Navient payment history. When determining the best course of action for a borrower, we refer to a document called the NSLDS file. NSLDS stands for National Student Loan Data System and is the Department of Education’s central scholarship registry.

By registering for NSLDS, you can get and download your NSLDS file in TXT format from the official studentaid.gov website. It has all the information for your loans in one place, including FFEL, Commercial FFEL and Direct Loans. If Navient were to shut down their website tomorrow, we would point to the NSLDS file and almost never ask a borrower to log into their service’s website for information. This is because the government’s NSLDS file already contains them.

So if you’re concerned about Navient (or FedLoan) information being lost during the transfer– don’t worry. Progress towards IDR (income-driven repayment) and PSLF waivers is tracked on this independent, government-owned website. Sometimes this file is wrong, but that is rare. The most common issue we have encountered with the NSLDS file is FedLoan Servicing’s data encryption issue when it comes to six figure consolidation loans. Fortunately, in our experience, Navient had fewer errors uploading information to the federal NSLDS file.

Steps to Take Before Navient Closes

Here are some steps you can take now to maintain your sanity as Navient moves your federal student loans to a new service provider:

  • Upload your NSLDS file to the Federal Student Loans website that we link to.
  • In Google Drive or Dropbox, create a folder called “Student Loan Information” or something like that.
  • Place a copy of your NSLDS file in this folder.
  • Take a screenshot or download any additional information you deem relevant from the Navient website. Remember that the NSLDS file will remain even with the new servicer, so this is purely preventive and will probably be useless.
  • If you have a problem with your payments or refund credits, you should use the Consumer Financial Protection Bureau’s (CFPB) Complaints Portal to file a complaint before Navient is gone.

Don’t worry if you recently consolidated student loans or were planning to sue PSLF and fear losing your payment balance. Just follow the steps above.

Aidvantage vs Navient

Aidvantage is the government credit management unit of Maximus Education. In December 2021, it began managing Department of Education loans previously managed by Navient. This change was due to Navient ceasing to be a credit services business, specifically for direct loans and Federal Family Education Loan Program (FFELP) loans.

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In our surveys of student borrowers, Navient was one of the least popular service providers. Therefore, this change could be beneficial for borrowers who have had bad experiences with Navient. However, there are some important aspects of this change to note. Here’s what you need to know about Aidvantage vs Navient student loans.

Are Navient Loans Being Forgiven or Cancelled?

Navient Corporation is one of the largest government student loan servicers in the country. Since 2017, Navient has been involved in an increasing number of court cases. These include lawsuits from the Consumer Financial Protection Bureau (CFPB), several attorneys general and a group of teachers. On January 13, 2022, a major settlement was announced, joined by 39 attorneys general that called for Navient to provide a total of $1.85 billion in aid to private and federal student borrowers.

More than 66,000 Navient private student borrowers who have been leveraged will receive full forgiveness of their remaining balances. In addition, approximately 350,000 federal borrowers who were referred to long-term forbearance in lieu of an IDR will each receive recovery payments of approximately $260. What does the conclusion of the Navient lawsuit mean for you? Can my Navient loans be forgiven, are Navient loans eligible for forgiveness, would Navient loans be forgiven, can Navient loans be forgiven, is Navient forgiving all student loans, or Navient forgiving loans are some of the questions we are inundated with.

Who Qualifies for Navient Lawsuit?

Navient’s latest settlement is the first to offer direct relief to borrowers affected by “widespread deceptive and unfair practices in student loan servicing and abuses in predatory student loan underwriting,” according to the Navient Multi-State Settlement informational website. Borrowers eligible for Navient Loan Forgiveness or Repayment do not need to take any action to receive the benefits of this agreement. It will be an automatic process.

What Navient Loans Will Be Forgiven or Cancelled?

Navient’s $1.7 billion foreclosure will be awarded primarily to borrowers who took out subprime student loans with Sallie Mae between 2002 and 2014. Keep in mind that Sallie Mae was Navient’s predecessor.

  • As part of the settlement, the borrower must have been delinquent for more than 7 consecutive months by June 30, 2021.
  • Additionally, the borrower’s mailing address on file with Navient must be in one of these states or associated with a military address ZIP Code as of June 30, 2021: AK, AZ, CA, CO, CT, DC, DE , FL, GA , HI, IA, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, NC, NE, NJ, NM, NV, NY, OH, OR, PA, RI , SC, TN, VA, VT, WA, WV and WI.
  • Borrowers who attended certain for-profit schools and received non-subprime student loans between 2002 and 2014 are also eligible for relief.

However, many of these borrowers filed for a waiver through the federal Borrower Defense to Loan Repayment due to academic malpractice.

Eligible private student borrowers will automatically receive a notification from Navient in July 2022. Refunds will also be processed for any payments made on canceled debt after June 30, 2021.

Who is Eligible for Navient Restitution Payments?

Federal student loan borrowers targeted for long-term forbearance by Navient will receive a very small $95 million payment. Each eligible borrower is looking at a whopping $260.

  • To qualify, you must reside in one of the participating states (AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, IL, IN, KY, LA, MA, MD, ME, MN , MO, NC, NE, NJ, NM, NV, NY, OH, OR, PA, TN, VA, WA, and WI) or had a military zip code address as of January 2017.
  • In addition, you must have applied for a direct loan or reimbursement from the FFEL program before January 2015 and had verbal or administrative forbearance for at least two consecutive years between October 2009 and January 2017.
  • Eligible federal borrowers will automatically receive a postcard from the Settlement Administrator during the spring. So be sure to update your mailing address on your StudentAid.gov account.

How to Get Navient Loans Forgiven?

If you have federal student loans with Navient, here are several forgiveness options available to you:

Public Service Loan Forgiveness (PSLF)

If you work for a qualified public sector employer such as government or a non-profit organization, the Public Service Loan Forgiveness program is probably your best option for student loan forgiveness. With PSLF, you can get tax-free student loan forgiveness in as little as 10 years (or 120 qualifying student loan payments).

It should be noted that the Department of Education has selected FedLoan Servicing as the exclusive manager of the Public Service Loan Termination Program. This means that you can only benefit from this program if FedLoan is your servicer. So do Navient loans qualify for PSLF or are navient loans eligible for PSLF?

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But don’t worry if you are on Navient right now. You can apply for PSLF on the StudentAid.gov website. If you are accepted into the program, Navient will automatically transfer your government student loans to FedLoan Servicing. The Department of Education will let you know if you have been accepted into the program. But if it’s taking longer than you think to get a response, you can call FedLoan Servicing at 1-855-265-4038 to request a status update.

Note that Parent PLUS loans are not eligible for PSLF. However, Parent PLUS borrowers may become eligible by taking out a Direct Consolidation Loan. It is also important to understand that for Parent PLUS loans, the parent’s employment must qualify for the PSLF, not the student’s.

Navient Income Based Repayment

Currently, the Department of Education’s Federal Student Aid offers 4 income-based repayment plans for its loans.

  • Pay As You Earn (PAYE) plan
  • Revised Pay As You Earn (REPAY) plan
  • Income Based Reimbursement (IBR) Plan
  • Income Contingent Refund (ICR) Plan

By using these income-based repayment plans, you may be able to reduce the size of your monthly payments. In addition, you may be eligible for student loan forgiveness from Navient once you reach the end of your repayment schedule.

Depending on which plan you choose, you will be eligible for forgiveness in 20 to 25 years. However, you must remain vigilant to ensure your federal student loan payments are processed properly. And you must re-certify your income and family size every year.

And remember that if you get a refund, you will have to pay taxes on the amount forgiven. So if your strategy is income-driven repayment (IDR) forgiveness, be sure you save a little money for that upcoming tax bill each year.

Navient Teacher Loan Forgiveness

Teachers may be eligible for up to $17,500 in student loan forgiveness through the Teacher Loan Forgiveness Program. However, to qualify, you must be classified as a “highly qualified” teacher by the Department of Education’s Federal Student Aid Office. And you must teach five consecutive years at an elementary school, high school, or low-income educational services agency. It is important to note that the PSLF and teacher loan forgiveness do not mix. In many cases it might be better to stick with PSLF.

Navient Loan Discharge

Technically, it’s not a “forgiveness” option. However, it should be noted that there are several ways for federal student loan borrowers to be eligible for forgiveness on their student loans.

An example is the Total and Permanent Disability Release (TPD). To be eligible for discharge from TPD, you must provide medical documentation of your disability. Loans eligible for Total and Permanent Release from Disability (TPD) include direct loans, FFEL loans, and Perkins loans.

The Federal Student Aid Office also discharge your student loan if you or, in the case of the Parent-PLUS loan, one of your parents dies. Other federal discharge options include closed school discharge, borrower defense discharge, and unauthorized payment or false certification discharge.

Frequently Asked Questions

Are Navient Loans Federal or Private?

Navient loans can be in the form of federal or private student loans. However, Navient no longer offers federal student loans, but still offers private student loans. As mentioned earlier, Navient was one of the largest federal student loan managers before it was terminated after December 31, 2021. Its loans were transferred to Aidvantage. Navient still offers private student loans from various lenders. Navient was formed in 2014 to take over the public student loan service from Sallie Mae. If you had a Sallie Mae loan through the federal government before 2014, Navient probably handled it.

Navient does not issue its own personal student loans, but does offer personal student loan refinance to existing customers by invitation only. Most student loans are federal. However, if you are still unsure whether your student loan is government or private, the best way to find out is to log into studentaid.gov with your FSA ID. All information on federal loans is there. If you can’t find your loan information on studentaid.gov, you have a personal student loan.

How to Get Rid of Navient Private Student Loans?

If you have a Navient private student loan and do not qualify for one of the above programs, refinancing your Navient student loans is the best strategy to get rid of it. By refinancing, you could kill two birds with one stone. This is your chance to get rid of your private loan and you can also save money on student loan interest. Although refinancing is not student loan forgiveness, it could be your best Navient student loan strategy. But how do student borrowers know when refinancing is the right decision? Here are three questions to ask yourself:

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1. Will you soon be eligible for a federal forgiveness?

If you are just starting your loan repayments, refinancing could save you a lot of money over the life of your loans. But if you have already made three years of federal student loan repayments for Teacher Loan Forgiveness, or five years for Public Service Loan Forgiveness, that completely changes the discussion. If you are already on track to qualify for Navient student loan forgiveness through a federal program, you should avoid refinancing.

If you choose to stay with Navient, make sure you have the right payment plan and file your taxes correctly. You also need to be vigilant to ensure that Navient is handling your loans properly. If your loans are in default with Navient, you may need to contact a student loan attorney.

2. What is your financial situation?

When you refinance federal student loans, you are no longer eligible to base your monthly payment amount on your income or to request a federal deferment or forbearance. In other words, federal student loan borrowers have less repayment flexibility on private student loans. Rain or shine, the bills keep coming. Have you set up an emergency fund? Otherwise, you may want to achieve this goal before refinancing federal student loans.

There are two other financial factors to consider: your credit rating and your debt-to-equity ratio. If you have a credit score above 650 and owe less than 1.5 times your income, you may be an ideal candidate for refinance. Otherwise, you may want to keep the loans you received from the Federal Student Aid office.

3. Have you achieved professional stability?

If you expect your income to grow in the years to come, refinancing your Navient private student loan could be a good decision. Income-based repayment plans gradually become less useful as you make more money. Plus, you will be tied up on your student loans for 20 years or more and pay a lot more interest.

However, if your employment situation is unstable, you may want to stick with federal student loans as they offer more repayment options. Knowing that income-driven repayment (IDR) is available when you need it can be a comfort. And when your professional situation stabilizes, you can always refinance later.

How do I contact Navient Loans Customer Service?

Federal student loan borrowers can continue to use their Navient credentials on the Aidvantage website.

If you are a private student borrower whose loans are managed by Navient, you can obtain details of your student loan by contacting Navient Private Student Loan Customer Service:

Navient customer service phone: 800-722-1300.

Web: navient.com.

Email: Send emails from your Navient account on navient.com

You will need your Navient ID and password to log into your account. If you don’t know your username or password, use your social security number or bank account number to get your contact information. You can also use your social security number or bank account number to register your Navient account if you haven’t already set it up.

Your Navient account number is located in the top right corner of your bank statement. If you need money for college, file the FAFSA and exhaust grants and scholarships before pursuing federal student loan options. Federal student loans have benefits unavailable for private loans and often come with lower interest rates. Only turn to private student loans if you still have funding gaps.

Navient Customer Service Hours

You can contact Navient from Monday to Thursday from 8:00 am to 9:00 pm ET

The Last Thing You Need to Know about Aidvantage vs Navient

The most important thing to remember when switching between loan servicers, Aidvantage vs Navient, is that there probably won’t be any massive changes in the process. If you have a student loan repayment strategy that you are happy with, it probably won’t affect you too much other than verifying your account access online through the new Aidvantage website. Likewise, if you are currently unhappy with your plan, now could be a good time to re-evaluate your payment strategy.

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