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My One Year Student Loan Payoff Update

  January 28, 2022 marked my one year anniversary of paying off my student loans . Reflecting back on choosing to pay off my student loans leaves me with several take a ways that I want to share with you! In September 2020 I decided to become debt free by utilizing the debt snowball method to pay off all my debt. Before this I had struggled to save and really understand basic financial principles. As a first-generation college student, I received a scholarship to attend undergrad for free, but the scholarship did not cover summers. During the summers I took out student loans to cover costs without paying interest rates or how much I was taking out. By the end of undergrad I had amassed a little under $17K. Fast forward to graduate school I received another scholarship that covered my education. At the time I was a teacher in a new very expensive city and I had missed the cutoff to have my paycheck last me throughout the summer. So, I decided to take out a loan for two summers to keep

FedLoan is Extending their Student Loan Contract?!

 

So if you are making student loan payments like I am and your loans are with FedLoan you have probably noticed the error message at the top of the screen that states that FedLoan will be ending their contract to service student loans soon. However, there is no date posted as to when the contract actually ends. So that prompted me to do some digging so that I could be prepared for when this happens.


Figure 1: This is a thumbnail for my YouTube video “FedLoan is Extending their Student Loan Contract?!” where I am sitting in my office with my arms folded, wearing a yellow sweater, with a suspicious look on my face. My hair is short, black, and curly.

Upon further research, I learned that FedLoan is actually extending their contract for one year, which will end on December 14, 2022. I’m not sure why FedLoan has decided to extend their contract but I suspect that it may be due to the PSLF or the Public Service Loan Forgiveness Act. FedLoan is the sole contractor for the PSLF and with all of the recent changes to this program this will most likely require a lot more time for folks to turn in the waiver to make them eligible to have their loans forgiven under this act. 


Figure 2: This is a screenshot of the message that is at the top of the screen when I log into FedLoan. The message states that FedLoan will stop servicing student loans at the end of their contract.  


Now all though FedLoan will be ending their contract in 2022 you can still expect your account to be transferred to a new loan holder like Naviant, MOHELA, etc up until this date to create a smooth transition. With this being said be sure to print off all documents that may be stored in your account. As you know when accounts change sometimes, things get lost and you do not want any of your information permanently deleted. Start with printing off your current balance, your payment history, and other important communication. Be sure to place this information in a file or save it to the cloud. 

Figure 3: This is a photo of three file folders with papers inside of them. The folders are blue, yellow, and red.

 

Guys I am almost at the finish line with paying off all of my student loans! I hope that I will be finished by the end of this month but if not it will definitely be next month. So stay tuned for more information about my student loan journey. What are your thoughts on FedLoan extending their contract? Does this make a difference for you in any way? Are you paying off your student loans? Drop down in the comments and let me know! Also, be sure to check out my latest video below! To stay up to date with this topic and many others be sure to sign up for my email subscriber list !

 

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