American Education Services is a company that provides loans through private student loans and the Federal Mortgage Loan Program. FFEL is scheduled to shut down in 2010, but millions of loans are still being repaid. If AES offers student loan services, it’s best to understand how a company can help manage payments.
What Is American Education Services (AES)?
American Education Services is a student loan services company that handles student loan accounts via reimbursement. It is also one of the few loan service providers that have signed a contract with the Ministry of Education to oversee student loans granted via the federal program.
AES is maintained by the Pennsylvania Higher Education Support Organization (also known as PHEAA), a student support organization. PHEAA is one of the leading student loan service providers at the national level. This contains an extensive range of federal student loans. According to the Federal Student Aid Department data, as of September 2020, PHEAA has provided $ 380.8 billion in federal student loans to more than 8 million borrowers.
PHEAA offers student loan services nationwide through AES and FedLoan Servicing. AES and FedLoan are affiliated, but they are different student loan service providers and work independently.
How did AES Student Loans work?
AES Student Loans is an education debt account controlled by this loan service company. These debts can be private student loans or federal student loans borrowed via the FFEL program.
Though the FFELP program closed in 2010, the FFELP loans have not been provided for more than ten years. However, many mortgagors, including those served by AES, are still repaying these types of loans. Therefore, some borrowers have AES, which can provide services for loans borrowed from private lenders.
Is AES a private or federal student loan?
You can recognize the type of loan you have by logging in to your online account.
You can also use the Student Loan Data System at studenttaid.gov to see if your loan is a federal student loan.
After logging in, you will be able to see the loan description.
You must include the term FFEL in the description of federal student loans.
FFEL loans are loans provided under the federal family education loan program.
The FFEL program is funded by private lenders and supported by the federal government.
Private student loans can say something similar to NCSLT in the description. AES is a leading loan provider owned by the National University Student Loan Trust.
Do AES loans qualify for loan forgiveness?
To be eligible for the PSLF program, you need to:
- Full-time work
- Work in public services for qualified employers
- 120 payments per month
- Pay these payments according to an income-based repayment plan
- Have a direct loan
The final qualification is the key.
The PSLF program only allows federal loans under the direct loan program.
AES is not a direct loan provider.
AES is a component of the Pennsylvania Higher Education Support Organization. PHEAA also owns FedLoan Servicing in its portfolio, and PHEAA designed this service to act as a service provider for various federal loan programs.
AES is a loan service provider that offers loans under the Federal Family Education Loan Program. Therefore, if you pay a federal student loan to AES, that loan is not covered by the PSLF program. This is terrible news.
The good news is that you can qualify by combining these FFEL loans into a Direct Consolidation loan. The new loan you get is qualified for the PSLF program.
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What are American Education Services’ interest rates and fees?
The United States Department of Educational Services does not put interest rates on loans. The United States Congress sets interest rates for federal student loans, and private lenders set interest rates and loan terms for loans initiated by them. If you are unfamiliar with the interest rates and types of fees charged by the lender, you can:
- Log in to your AES account and go to your loan details.
- Call AES Customer Service (800-233-0557) Monday through Friday from 7:30 am to 9 pm EST.
- Check your monthly statement.
- Log in to NSLDS to view your student loan details.
How AES Can Help Borrowers?
Using AES as your service provider will become a one-stop service for any operations or assistance you may require for these accounts. Here are some particular ways AES helps debtors handle student loans.
Billing and Processing Payments
AES takes student loan payments via direct debits, online transfers, checks, and its mobile application. If you like to pay more or less than you owe, AES offers you the option of allocating certain funds to a particular account. This permits you to repay some loans faster than others.
Help Struggling Borrowers
AES can help find borrowers who are struggling to carry on with student loan payments. Some possibilities include understanding the option to change the due date and reduce or suspend payments.
Access Federal Student Loan Benefits
According to its website, AES can assist you in discovering, apply, and use protections and programs for federal student loan borrowers. This consist of:
- Reduce or adjust payments through federal repayment programs, such as gradual and income-based repayments
- Federal Student Loan Consolidation
- Understand plans to forgive, cancel or repay federal student loans
- Postpone payment by deferring or concession
- Recovery of defaulted federal student loans
American Education Services Lawsuit
PHEAA has been subject to multiple proceedings by states for abusing and misusing borrowers under the PSLF program. In February 2021, the loan manager resolved a class action proceeding filed by the Massachusetts Attorney General. The proceedings accused PHEAA of deliberately extending the loan term. They converted the grant into a loan and did not correctly notify the applicant of the PSLF program requirements, get a 99% rejection rate.
The bottom line
The American Educational Services Corporation proposes several ways to handle your account and pay federal or private loans. If your service provider is having trouble, you can refinance or merge your student loans. However, these options have consequences, so consider them cautiously before making any changes.