During the tumultuous times of the COVID-19 pandemic, Wells Fargo quietly made a significant decision that affected many students’ financial lives. It bid farewell to its entire student loan segment. If you were already a Wells Fargo customer, there was a window of opportunity to secure new private student loans, which remained open until January 28, 2021.
The New Custodian
With Wells Fargo out of the student loan game, the pressing question was, “Who would take over the service of Wells Fargo’s existing student loans?” The answer came in the form of Firstmark Services, a division of Nelnet, which stepped in to manage the student loan servicing.
Options for Pre-Transfer Wells Fargo Borrowers
If you were one of the smart individuals who secured Wells Fargo student loans before the bank decided to exit the education lending sector, you have two paths forward:
1. Continue Payments Through Firstmark
Firstmark Services notified all affected borrowers, outlining how to access their accounts and continue making payments. You can contact Firstmark Services at 888-538-7378, operating from Monday through Friday, 7 a.m. to 8 p.m. ET. This option ensures a seamless transition in servicing your loans.
2. Consider Refinancing with Another Lender
Alternatively, you can refinance your Wells Fargo student loans with a different lender. This step might lead to more favourable terms and conditions. After paying off your debt, you’ll start making monthly payments to the new lender.
Exploring Alternatives
Now, if you’re currently in college and seeking financial support, here are some alternatives to consider:
Federal Student Loans
Federal loans often serve as an excellent starting point for funding your college education. Various forms of federal student aid are at your disposal, including:
Direct Subsidized Loans
Designed for low-income undergraduate students, these loans don’t accrue interest while you’re in school at least half-time or during grace periods.
Direct Unsubsidized Loans
Both undergraduates and graduate students can qualify for these loans. They accrue interest while you’re in school but offer low, fixed interest rates and flexible repayment options.
Direct Parent PLUS Loans
These loans allow parents to borrow money for their child’s undergraduate education.
Direct Grad PLUS Loans
If you’re pursuing graduate studies and have exhausted unsubsidized loans, Grad PLUS loans can cover the total cost of attendance.
The federal student loan system also offers benefits like income-driven repayment (IDR) plans, loan forgiveness options, and forbearance, providing essential financial flexibility.
To apply for federal student loans, complete the Free Application for Federal Student Aid (FAFSA) and connect with your college’s financial aid office.
Refinancing Wells Fargo Student Loans
If you’re looking for a fresh start with a new lender, refinancing your Wells Fargo student loans is a viable option. Doing so can secure better interest rates and terms tailored to your budget.
Private Student Loans
Numerous financial institutions extend private student loans to undergraduate and graduate students and parents supporting their children’s education. Private loans often allow borrowing up to the total cost of attendance, with repayment terms stretching up to 20 years. Plus, many lenders permit postponing payments until after graduation.
Comparing Your Student Loan Options
Making informed decisions is crucial when navigating the maze of student loan options. Take time to compare offers from different lenders, considering factors like:
- Interest Rate Types: Federal loans feature fixed interest rates, while private loans may offer fixed or variable rates.
- Loan Terms: Evaluate the impact of various loan terms on your monthly payments and overall cost.
- Credit Requirements: Private lenders tend to have stringent credit requirements, so monitor your credit score.
- Loan Amounts: Different lenders may have different borrowing limits.
- Repayment Options: Understand the repayment options, including in-school payment requirements.
Considering these factors will help you make a well-informed choice, ensuring your educational journey is financially secure.