Granite State Management and Resources, a federal student loan service operated by the New Hampshire Higher Education Association Foundation, recently announced plans not to renew its contract with the US Department of Education at the end of the year. In addition, Connecticut colleges and universities are writing off $ 17 million in student loan debt, a move that will affect more than 18,000 current and former students. Here’s what you need to know about student loan news this week.
2 current student loan trends for the week of Jul 26, 2021
1. Granite Public Administration and Resources Terminates Contract with Federal Student Aid Program
Granite Public Administration and Resources (GSM & R) announced in Press release that he will complete his contract with the US Department of Education on December 31 of this year. GSM & R currently serves 1.3 million borrowers with federal student loans, payment processing, abstinence requests, and repayment plans. GSM & R will no longer service federal student loans when the contract expires and will instead focus on its private student loan product. EDvestinU…
The Department of Education will be responsible for transferring the 1.3 million borrowers currently managed by GSM & R to other federal service personnel. Federal Student Services COO Richard Cordray said individuals currently borrowing from GSM & R can expect “early and frequent communication and clear guidance” regarding the upcoming transfer.
How does it affect student loans
GSM & R is the second federal service personnel to terminate a contract with the Department of Education this month. The Pennsylvania Higher Education Support Agency (PHEAA), also known as FedLoan Servicing, has announced plans finish your contract December 14, 2021
Between the two service providers, approximately 10 million borrowers will be transferred to other federal services through the Department of Education, adding additional pressure to the end of the administrative leniency period at the end of September. The department also announced earlier this year that making important steps towards redefining the student loan repayment process by creating a single centralized platform for student loans.
Borrowers who have received loans currently managed by GSM & R and PHEAA can count on liaising with their support staff or from the Ministry of Education. Borrowers affected by the move will see changes in their service organization, but their loan details will not change.
2. Connecticut colleges and universities are writing off debts of more than 18,000 students.
Connecticut Colleges and Universities (CSCU) are writing off institutional student loan arrears from the summer of 2019 to the spring of 2021, resulting in a write-off of $ 17 million to 18,161 former and current students.
The money used to write off the debt comes from the federal higher education emergency fund, which was designed to help colleges and students affected by the pandemic. “By clearing these students’ debt to educational institutions, we are removing the obstacle that is keeping too many people from continuing their educational journey,” said CSCU President Terrence Cheng.
In addition to paying off this outstanding debt, CSCU will also waive the suspension of class registration and account hold, granting registration status to students who were unable to register for classes due to arrears.
How does it affect student loans
CSCU follows Fayetteville State University and Delaware State University, among other colleges, in using federal pandemic relief funds to write off student debt.
This forgiven debt to the university; debt to private student loan lenders or the federal government is still outstanding. However, clearing institutional debt allows current students with outstanding loans to register for classes and former students to focus on paying off other forms of student loans.
Here’s how to prepare
Whether you are new to obtaining student loans or in the process of paying off, it is wise to know how student loan rates can change. As 2021 progresses, more opportunities may open up for cheaper loans or loan forgiveness; follow up Student Bank Loan News Center for the latest trends.