The Department of Education has approved a request from Navient to transfer its portfolio of 5.6 million of student loans to Maximus, which will take over Navient’s contract with the Department going forward.
Navient announced its decision to stop servicing loans under the Next Generation Financial Services Environment program, or NextGen, last month. The move came after two other servicers — the Pennsylvania Higher Education Assistance Agency (PHEAA) and Granite State Management and Resources — announced during the summer that they were also choosing not to renew contracts with the federal government to service and collect on student loans.
“As evidence of our commitment to improving borrowers’ experience with federal student loans, we will make this transition as seamless as possible; borrowers will not lose access to their payment histories or account data, and they will not need to change their current log-in information, automatic payment arrangements, or other borrower-specific details,” said Richard Cordray, the Chief Operating Officer of Federal Student Aid, in a statement.
The transition comes at a time when the federal government is trying to navigate the payment restart for 41 million individuals with student loans who have not had to make a payment in more than 18 months and bolstering its oversight of student loan servicers.
About 800 Navient employees who worked on the NextGen account will be transferred to Maximus as part of the deal. Navient will serve as a subcontractor to Maximus for the next 90 days to facilitate the transition of accounts, Maximus announced. Once transferred, the loans will be serviced by Maximus’s Aidvantage platform.
