Understand My Great Lakes Student Loans
Student loans can be confusing and difficult to understand. It is important to try and comprehend how they work in order to avoid falling behind on your payments or defaulting on your loan. A lender is the actual institution that you borrow money from and who disburses money to your school on your behalf. This can be either the federal government or a private financial institution.
The loan servicer may be different from your lender; it is the company who actually services your loan. Your loan servicer is who collects your payments and handles any consolidation or refinancing you wish to do during the life of your loan. Loans are bought and sold constantly, and your loan servicer could change. The terms of your loan remain the same without your expressed consent to change them, however.
If you have a federal student loan, your loan servicer will be chosen for you. The U.S. Department of Education contracts with loan servicers, like Great Lakes, to manage their loans. Great Lakes does not actually fund or disburse student loans.
Loan Servicer Information
The Great Lakes Higher Education Corporation is a non-profit organization that works with the U.S. Department of Education and private lenders in order to help you successfully navigate the student loan process. Great Lakes is the point of contact for any and all questions you may have during the life of your loan. Great Lakes will keep you updated with all current information pertaining to your loan and assist you with repayment when it is time.
You will pay your bill for student loans to Great Lakes directly. Some of the services Great Lakes provides include:
- Keeping you current on your loan status
- Offering flexible repayment plans
- Providing you with debt consolidation options if you have more than one loan
- Helping you manage your debt to avoid default
- Financial advice
It is important that you make sure Great Lakes has your most current contact information, especially your mailing address. You should also take care to read any material sent to you by your loan servicer in order to ensure you know what is happening with your loan.
It is also important to be aware of what type of loan you have. Most likely you have a loan through the William D. Ford Direct Loan Program, which makes the federal government your lender. These loans are disbursed directly to your school after filling out your Free Application for Federal Student Aid (FAFSA) and may be either subsidized or unsubsidized. Subsidized loans are based on financial need, and the government takes care of the interest. In the case of an unsubsidized loan, you will be responsible for the interest payments.
In order to qualify for a federal loan, you must meet certain eligibility requirements, and you must reapply each year. Federal loans offer fixed-rate and low-interest payments with flexible repayment plans. The College Board published that 33 percent of undergraduates in the 2013-2014 academic year took out federal loans.
Commercial lenders or individual financial institutions hold private loans. They may have variable interest rates and be more expensive than federal loans in the long run. Private loans are often considered to be alternative loans to federal student loan options. Some students may have more than one loan or lender, and Great Lakes can work to help you consolidate your loans into one manageable payment.