Wells Fargo has exited the student loan business. Our private student loans are being transitioned to a new loan holder and repayment will be managed by a new loan servicer, Firstmark Services, a division of Nelnet.
Why is Wells Fargo closing student loans?
But the financial services company began exiting the student loan business in June 2020, partly because of COVID-19 disruption. That month, Wells Fargo said that it was narrowing its student loan focus. Even before the pandemic, reports show that private student loans were a shrinking part of the Wells Fargo portfolio.
Who did Wells Fargo sell my student loan to?
Firstmark
Wells Fargo sold its student loans to Firstmark, whose parent company, Nelnet, is well-established in the student loan industry. If you have a student loan with Wells Fargo, the transfer will be made with no action necessary on your part.
What does Wells Fargo have to do with student loans?
The disclosures must explain how the bank applies and allocates payments and how borrowers can direct payments to any of the loans in their student loan account. Correct errors on credit reports: Wells Fargo must remove any negative student loan information that has been inaccurately or incompletely provided to a consumer reporting company.
How many people are in default on student loans?
Today there are more than 40 million federal and private student loan borrowers and collectively these consumers owe roughly $1.3 trillion. Last year, the CFPB found that more than 8 million borrowers are in default on more than $110 billion in student loans, a problem that may be driven by breakdowns in student loan servicing.
Why did the CFPB take action against Wells Fargo?
While private student loans are a small portion of the overall market, the Bureau found that they are generally used by borrowers with high levels of debt who also have federal loans. According to the CFPB’s order, Wells Fargo failed to provide the level of student loan servicing that borrowers are entitled to under the law.
How big is the problem with student loans?
Last year, the CFPB found that more than 8 million borrowers are in default on more than $110 billion in student loans, a problem that may be driven by breakdowns in student loan servicing. Private student loans comprise approximately $100 billion of all outstanding student loans.
