When the time comes to start paying back student loans, many college grads are surprised to learn that they don’t deal directly with the U.S. Department of Education. The federal government issues billions of dollars of student loans each year, but it doesn’t supervise the repayment of those loans. Instead, it assigns them to a handful of authorized servicing companies that act as go-betweens, processing borrowers’ payments and answering their questions.
Great Lakes Educational Loan Services is one of the nation’s largest servicers, handling about 1 in 4 student loans issued by the federal government. If Great Lakes is your student loan servicer, learning who they are and what resources they offer could save you time and money. Here’s what you need to know about Great Lakes.
Great Lakes is based in Madison, Wisconsin and has been in business since 1967. It does not originate loans, but instead guarantees them and makes collections on behalf of lenders. Unlike many of its competitors, Great Lakes is a nonprofit corporation and is not publicly traded. Over the past 50 years, it has worked with more than 6,000 colleges and universities and 1,000 private lenders.
Great Lakes is now the second-largest servicer of federal student loans, behind American Education Services (AES). Great Lakes handles about 23% of the U.S. Department of Education’s direct loans, serving approximately 8 million borrowers with debt totaling over $220 billion. However, the volume should not be construed as a measure of popularity. Students have no say in which company manages their loan; servicers are assigned by the government. And like all of its competitors, Great Lakes has been the subject of numerous consumer complaints.
Student debt has been a hot political issue in recent years, as Americans’ outstanding loan balances have continued to surge. Political candidates and elected officials have proposed a wide range of remedies to address ongoing borrower frustration. One major change currently under consideration is to have a single online platform for all U.S. Department of Education loan servicing. Recently, Great Lakes formed a joint venture with Nelnet to bid on the massive contract. The combined entity, called GreatNet, is one of three vendors being considered for the job. The others are Navient and AES/FedLoan.
Like all servicers, Great Lakes manages borrowers’ accounts, processes monthly payments, and communicates directly with borrowers about their loans. The company helps borrowers change repayment plans or request deferment or forbearance, if they’re experiencing economic hardship. It also certifies borrowers for loan forgiveness.
After setting up an account on the Great Lakes website, borrowers can use the online portal to check their statements, make payments, change due dates, calculate payoff times, switch payment plans, print tax documents, and more. The company offers a .25% interest rate deduction for anyone who signs up for automatic payments.
Great Lakes also has a mobile app that can send reminders and confirmations. The app is available for both iOS and Android. Reviews have been mixed, but the company has released several updates to address complaints of bugs and limited functionality.
The Great Lakes website has a knowledge center to help current students, graduates, and parents navigate debt repayment. It has an archive of articles about loan forgiveness, consolidation, service member benefits, and more. The company’s Facebook and Twitter accounts also serve as sources of information and support.
Great Lakes differs from other loan servicers in that it does have a philanthropic arm. The company has given more than $200 million in grants since 2006 focused on overcoming barriers to graduation. Grants fund research and programs to help students from low-income families, students of color, and students who are first in their families to go to college.
Loan servicers don’t have much discretion when it comes to designing repayment plans. For federal student loans, they can only offer the payment plans established by the U.S. Department of Education. So like all of its competitors, Great Lakes offers a limited set of repayment options:
Great Lakes has an online Repayment Planner tool that shows account holders the effect of different plans, including how much they’d pay monthly and over the life of the loan. But it’s up to borrowers to research their options and request a change. All loans start out on the standard plan.
If you have a loan (or loans) being serviced by Great Lakes and you’re struggling to make your payments, the first step is to contact their customer service department. All graduates are entitled to a six-month grace period immediately after finishing college, but entry level salaries can be meager and unexpected financial difficulties can arise at any time. If you’re unemployed, underemployed, or experiencing hardship, you might qualify for forbearance or deferment. You might be able to decrease your monthly payments by extending the term of your loan. These are some of the remedies that servicers can offer, but the options are limited.
Many grads with Great Lakes-serviced loans have been able to cut their monthly payments significantly by refinancing with a private lender at a lower interest rate. If you owe at least $5,000 and you’re paying more than 4% interest, it’s a good idea to explore refinancing. Lowering your interest rate by just a few percentage points could have a huge impact on your overall repayment. In a recent analysis we found that people who refinanced with private lenders saved an average of $259 a month and $19,231 over the life of their student loans.
If you have multiple student loans, you can also consolidate them into a single monthly payment, simplifying your finances and making it easier to chart a path out of debt. It’s easy to find out if refinancing or consolidation can save you money. Online applications take less than 5 minutes, with no impact to credit. With most modern lenders, you can get a personalized quote in less time than it takes to brew a pot of coffee.
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Office Hours: M-F: 7:00 AM to 9:00 PM (CT)
P.O. Box 7860
Madison, QI 53707-7860
Works with 275+ not-for-profit community lenders for higher approval chances
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Offers unemployment protection and career/coaching/networking
SoFi, which stands for “Social Finance,” was created by a group of Stanford business students who found themselves with a mountain of debt after graduation. They set out to change the student loan industry and help borrowers like themselves to get lower interest rates. SoFi has some of the lowest interest rates and, unlike the other lenders we reviewed, it has no maximum amount you can finance. However, Nevada residents can’t currently refinance with SoFi. Minimum loan balances are higher in Arizona, Massachusetts and Pennsylvania due to state laws. Additional state restrictions may apply.
For every loan they fund, they contribute to the education of a child in need
CommonBond was founded in 2011 by three MBA graduates from the University of Pennsylvania’s Wharton School who wanted to help their peers escape from high-interest student loan debt. Its original focus was on grad students, but it has since expanded to cover undergrads as well.
Of all the companies we reviewed, CommonBond has some of the best customer service. The company prides itself on being easy to reach by email, phone, or live chat. It offers networking events, expert panels, insider newsletters, and even has a program help borrowers who lose their jobs to find new ones. CommonBond also makes you feel good about choosing to refinance with them by donating money to an education nonprofit for each loan they write.
Get a personalized review of your refinancing options with CommonBond today.
Earnest empowers people with the financial captial they need to live better lives.
Using technology, data, and design to build affordable products, Earnest's lending products are built for a new generation seeking to reach life's milestones. The company understands every applicant's unique financial story to offer the lowest possible rates and radically flexible loan options for living life.
Click here to apply with Earnest and to see how much you can save.
Operates in all 50 states; 2nd largest student loan refinancing lender
Laurel Road is a national online lender with customers in all 50 states, the District of Columbia, and Puerto Rico. Many of our non-bank competitors are not able to lend in all 50 states.Laurel Road has grown to be the second largest player in the student loan refinancing space in large part because of our reputation as the go-to low rate provider.
Special offers for medical resident and fellow refinance products
Splash Financial is a leader in student loan refinancing with new rates as low as 3.25% fixed APR which can save you tens of thousands of dollars over the life of your loans. No application or origination fees and no prepayment penalties. Splash Financial is in all 50 states and is intensely focused on customer service. Splash Financial is also one of the few companies that offers a great medical resident and fellow refinance product. You can check your rate with Splash in just minutes.
Click here to see more of Splash's offerings and to see how you can save money.