PHEAA Begins Servicing Federal Direct Loans
Agency passes U.S. Department of Education validation process
Harrisburg, PA (July 2, 2010)—The Pennsylvania Higher Education Assistance Agency (PHEAA) today announced that it had successfully completed the acceptance and validation process with the U.S. Department of Education (Department) to begin receiving and servicing new Federal Direct Loans.
In June 2009, PHEAA was one of four servicers to be awarded a Federal Loan Servicing Contract with the Department to service the nation's growing federally-owned student loan portfolio. In August 2009, PHEAA was approved by the Department to service Federal FFEL loans sold to the Department under the Ensuring Continued Access to Student Loans Act (ECASLA). Under this portion of the servicing contract, PHEAA is currently servicing loans for 1.5 million borrowers.
“This is great news for PHEAA and the Commonwealth,” said Representative William Adolph, PHEAA Board Chairman. “I have witnessed the dedication and commitment of all PHEAA staff who have worked so hard to make this happen - helping to ensure PHEAA's continued strength as it fulfills its public service mission for Pennsylvania families.”
To handle additional student loan capacity and meet federal requirements, PHEAA upgraded a number of existing systems and implemented additional security measures within the agency. The need for additional staffing to service loans from the Department allowed PHEAA to accept applications for 150 full-time and summer positions in its customer service and collection call centers.
“In a difficult economic environment with high unemployment rates, PHEAA was able to offer significant employment opportunities to residents of Pennsylvania,” said Senator Sean Logan, PHEAA Board Vice Chairman. “As the federal government's loan portfolio continues to grow and new business opportunities arise, PHEAA has proven it has the ability to respond quickly to keep pace with ongoing changes in the student loan industry.”
Last year, PHEAA launched its new MyFedLoan.org website where borrowers who have their loans assigned to PHEAA for servicing can manage their accounts online and access important information about repayment options, while schools can access and customize PHEAA's student loan default prevention materials.
PHEAA will continue working closely with students, families, schools and lending partners by servicing loans for its existing customers, administering the State Grant and other state-funded student aid programs and providing early awareness and outreach services and programs to Pennsylvania residents.