What's the Difference between Sallie Mae and Navient?

Sara Lindberg Updated on May 7, 2018

Two names that come up often when talking about student loans are Sallie Mae and Navient.

Lots of people know the name Sallie Mae because of its connection with the federal student loan program through the U.S. Department of Education. In fact, if you're a parent, it's possible that you had a federal student loan through Sallie Mae. But that company's role has changed. Here's what you need to know.

sallie mae-navientDecades ago, Sallie Mae was formed as a government entity tasked with servicing federal student loans. Over time, Sallie Mae began offering private loans as well. 

Fast-forward 40+ years to 2014 when, thanks to government regulations, Sallie Mae was no longer allowed to offer both private and federal loans. So the company split in two: Sallie Mae would handle private loans and Navient would service federal loans for the government. 

Today, Sallie Mae and Navient operate as separate entities.

So if you're applying for a Sallie Mae loan, know that it's a private loan through a private lender. If you're hoping to get a federal student loan, you'll need to fill out the FAFSA. When you begin making payments, Navient may be the company that services your loan—or it could be one of the several other federal student loan servicers.

Your student loan servicer basically acts as the billing, collections, and customer service for federal loans.  

Best Banks for Private Student Loans in 2018. Get Your Rate.

What Sallie Mae can do for you

Sallie Mae offers private student loans including the Sallie Mae Smart Option Student Loan and the Sallie Mae Parent Loan.

They offer competitive rates that range from 3.87% APR to 10.75% APR for a variable interest rate loan and 5.74% APR to 11.85% APR for a fixed interest rate loan. Plus, they have three different repayment options you can choose from.

The Sallie Mae Smart Option Student Loan is for students who have been accepted or are enrolled in an eligible degree-granting institution within the last year. You must be U.S. citizens or permanent resident. Non-U.S. students can apply with a creditworthy cosigner who is a U.S. citizen or permanent resident.

See our Sallie Mae Student Loan Review for more detailed information about eligibility requirements. 

The Sallie Mae Parent Loan is a private loan that is available to parents, family members, or other individuals who plan on helping pay for a students education. You must be a U.S. citizen or permanent resident and have good credit in order to apply for this loan. 

What you need to know about Navient

Since you’re on the borrowing end of the student loan process, you might not be too concerned about the company that is going to service your federal student loan.

More than likely, you’re just trying to figure out what your FAFSA status is and how to read your financial aid award letter. 

But after graduation, Navient may be the one servicing your student loans—which means you will be sending your monthly payment to them.

After you start paying on your student loan, they will be able to provide you with information about different income-driven repayment plans that can help make your monthly payments more affordable. And if you experience financial hardship or lose your job, Navient may also be able to assist you with deferment or forbearance. 

Want to know more about how private student loans work? Get our free Private Student Loans 101 guide. 

Published in: Federal Student Loans

About the Author
Sara Lindberg

Sara Lindberg, B.S., M.Ed., is a freelance writer specializing in business, finance, health, and wellness. She holds a Bachelor's of Science degree in Exercise Science and a Master's Degree in Counseling. When she’s not writing, Sara can be found at the gym lifting weights, running the back roads to train for her next half-marathon, and spending time with her husband and two children. Read more by Sara Lindberg

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