The current economic environment has caused many student loans to be shuffled around between lenders, and this has made it hard for students to keep track of who exactly they need to pay to clear their debt..
Many banks left the student loan business over the past year. That left those banks with no choice but to sell their student loans to other lenders, unbeknownst to many students.
The University of Arkansas Department of Financial Aid said students are often left in the dark because their current contact information isn't passed along to the new lender. That leaves new lender with no way of getting a hold of the student. In a worst case scenario this can result in a student's loan defaulting.
The university says it is constantly working to make sure this communication breakdown doesn't happen. That includes setting up systems that electronically update a student's contact information with the new lender.
Still, U of A sophomore Shanti Rahm said she still hasn't been contacted by her new lender about her loan. She said she’s waiting for them to send her a letter so she can know where to send her money.
The Office of Financial Aid said a situation like that can be avoided if a student makes sure to save all correspondence between them and the lenders, old and new. Most of the time a lender will let the student know before their loan changes hands.
The office also said many banks that still deal with student loans have reevaluated their loan transfer procedures, and this sort of confusion should start to disappear over the next year.
Source: http://www.4029tv.com
