This past month, student loans were transferred to the Sallie Mae loan company. The Federal Government has made a few changes to their methods because of the large amount of loans students are applying for. Although students might feel as though they should have been alerted about the transfer of their loans beforehand, the change was beyond LIU Post’s control.
LIU Post, according to Joanne Graziano, associate provost for the Student Financial Services, didn’t have any control over the transferring of several student loan profiles to Sallie Mae, a well-known and often criticized loan company. “These kinds of decisions are made by the Department of Education; Post did not give the loans to the students.”
In an automated email sent to those whose loans were transferred about a week ago, the Direct Loan Servicing Center explained that the Federal Student Aid has “expanded the federal loan servicers to provide additional servicing capacity.”
Federal resources are kind of limited, according to Graziano. “So [the federal government is] hiring companies like Sallie Mae to assist them,” she added.
Payment plans will remain the same, except now students will have to send in their loan payments to the Sallie Mae Company. Sallie Mae will also assist students if they need to adjust their loan payments.
“When students signed the Master Promissory Note [when they applied for the loan,] they gave the federal government permission to do as they pleased with the loan,” Graziano added. She also compares signing the Master Promissory Note to signing for a mortgage. “You make a deal for the life of that mortgage.”
There are rumors of Sallie Mae harassing those who take out loans with them. “Like with any other loan company, if you agree to a payment plan, you have to be on time with your payments. Late payments result in those phones calls,” said Graziano .
This is not just happening at LIU Post, according to Graziano, it is happening at many other universities as well.
According to LIU Post senior and English Literature major, Nicole Ramlogan, this is not the first time loans were chosen and switched to other loan service providers. “Last year, my federal loans were transferred to Nelnet.” Ramlogan, who had two other friends who experienced this change, explained that she was not worried at all when she received a letter in the mail disclosing the details of the transfer. “Everything [about my loan arrangements] stayed the same.”
When asked if she would have preferred some sort of notice before her loan transfer, Ramlogan stated, “I’m indifferent. If you sign [a loan agreement], you should know what you’re signing for.”
Not every student at LIU Post had their loans transferred because the loan load was basically split between the Direct Loan Servicer and Sallie Mae. Though it is still unclear the criteria used to choose student loan profiles to be transferred, all students should check their My LIU emails to see if their loan was switched over to Sallie Mae.