Navient Exits Student Loan Servicing: What’s Next for Borrowers

For years, Navient has been slowly shifting away from servicing student loans, and it will soon complete the process.

In its recent announcement on Jan. 30, 2024, the company revealed plans to outsource the servicing of its remaining student loan portfolio, including 2.7 million student loans, to MOHELA. As a result of this transition, Navient expects to eliminate as much as $400 million in operating costs.

If you have FFEL loans or private student loans serviced by Navient, you should continue making your loan payments to Navient until you’re notified to pay a new servicer.

Current student loan rates

How will my loans be impacted?

Navient has indicated that the transfer of its student loan portfolio to MOHELA will begin in the latter half of 2024, but could take almost two years to complete. Borrowers currently working with Navient need to be aware that they may soon have a new loan servicer to collect their payments and assist with loan tasks. 

Based on problems that occurred during past transitions, it's also crucial for any borrower who sees a $0 balance on their Navient account to understand their loans are just being moved and not being erased.

If you have FFEL loans managed by Navient

The Federal Family Education Loan (FFEL) program stopped operating on July 1, 2010, but there are still many borrowers with outstanding loan balances. Approximately $38 billion worth of these outstanding FFEL loans are being serviced by Navient — for now. All the FFEL loans currently within Navient's portfolio will transition to MOHELA for loan servicing over the course of the next 18 to 24 months.

It's also important to note that you have the option of consolidating FFEL loans into a federal Direct Consolidation Loan. This can result in your loan being transferred to a different federal loan servicer. If you don't want to lose the progress you’ve made toward loan forgiveness, you'll need to consolidate your FFEL loans by Apr. 30, 2024, to ensure you get credit for payments you’ve already made.

If you have private student loans managed by Navient

While Navient's private student loan portfolio is less substantial than its FFEL portfolio, the servicer still has $17 billion of private student loans under its control. Like the FFEL loans, private student loans will become the responsibility of MOHELA to service after the transition is completed throughout the latter half of 2024 and the upcoming two years.

If you have federal loans managed by Navient

Navient stopped servicing other federal student loans besides FFEL loans as of Dec. 31, 2021. So if you had other federal loans serviced by Navient in the past, you should not be impacted by this new transition. It’s likely that Aidvantage has already been servicing your loan for several years. 

Related: 8 Ways To Lower Your Student Loan Payments

How can borrowers prepare? 

Navient has indicated it will work with MOHELA “toward ensuring a seamless transition in the coming months and providing customers with uninterrupted servicing of their loans,” according to their website. 

MOHELA also has a dedicated web page for borrowers who receive notice that their loans will be transitioned. You can review MOHELA’s resources to learn how to do things like create an online account login. 

While the transition should hopefully happen seamlessly, it is still a good idea to download and save your loan payment history in case information is lost during the process of Navient transferring its portfolio. You'll also want to make sure your most updated address and contact details are on file in case Navient or MOHELA needs to get in touch with you.