The Department of Education set up FedLoan Servicing as a student loan servicer working of behalf of the Federal Government Educational System. In 1963, this company began as Pennsylvania Higher Education Assistance Agency, and has grown into a larger loan servicing company. Fed Loan Servicing helps with two major types of federal student loans: Direct Loans and the Federal Family Education Loan Program Loans (FFELP Loans). Only a few companies actually handle Direct Loans. FedLoan Servicing will combine loans for students who have loans under more than one servicer. They also advise students to help manage their educational debts.

Somehow, for most students FedLoan naturally becomes the transitional servicer for students due to the Department of Education choosing this company to handle all loans. You do have a choice if you wish to use FedLoan or would prefer to consolidate with other servicers.

This is what FedLoan Servicing offers in terms of Repayment Options:

    • Standard Repayment: Equal monthly payments are set up for a 10 year period.
    • Graduated Repayment: Payments start out low but increase over the course of 10 years.
    • Extended Fixed Repayment: Equal monthly payments are set up for a 25 year period. You must have $30,000 or more in outstanding federal student loans to qualify.
    • Extended Graduated Repayment: Payments start low but increase over 25 years. You must have $30,000 or more in outstanding federal student loans to qualify.
    • Pay As You Earn Repayment: Student loan payments are based on 10% of your income, and debts are forgiven after 20 years of qualifying payments.
    • Income-Based Repayment: Monthly payments are based on your adjusted gross income and family size.
    • Income-Contingent Repayment: Monthly payments are based on your adjusted gross income, family size, and total loan debt.
    • Income Sensitive Repayment: Monthly payments are based on your total monthly gross income, and you must reapply for the program once a year.


    • One servicer, one bill, one payment
    • Lower monthly payments
    • Fixed interest rate


    • More monthly payments
    • More interest to pay
    • Loss of loan incentives
    • Risk of ineligibility for some military benefits

Who this is best for:

      • Have loans with multiple servicers
      • Have significant student loan debt
      • Have more than one type of federal loan
      • Have loans with variable interest rates
      • Have trouble paying the amount due on your loans and need a lower payment

FedLoan Servicing is one of a limited number of organizations approved by the Department of Education to service these loans and is dedicated to supporting borrowers with easy and convenient ways to manage their student loans.

When you have financial hardship

If you can't afford your student loan payments, don't wait until you fall behind to seek assistance. You may be able to lower your monthly payments by changing your payment plan. You may even qualify for a monthly payment as low as $0 on an Income-Driven Repayment (IDR) plan. IDR plans are a great long-term solution that can make managing your loans a little bit easier because they offer:

      • Payments as low as $0 per month
      • Payment amounts based on your income and loan debt
      • Extended repayment periods
      • Loan forgiveness

To make a payment through FedLoan, choose from one of the following:

      • Direct Debit: Have the payments automatically pulled from your bank account once a month.
      • Pay Online: Make a payment through using your bank account information.
      • Pay by Smartphone: Pay through the MyFedLoan website on your smartphone.
      • Pay by Phone: Call 1-800-699-2908 to make a payment over the phone.
      • Pay by Mail: Send in a check or money order to MyFedLoan by mail 5-7 days before the payment is due.

As long as you keep up with your payments through FedLoan, you should be on your way to paying off your federal student debt. Many borrowers who have loans with FedLoan are unsatisfied with how cut and dry the servicer is when there are hardships. On top of this, there have been many complaints about the quality of customer service and the way problems are resolved; not much flexibility with FedLoan. They are reported to be resistant and strict, leaving many borrowers more frustrated and stressed.

Other Companies to Consider: SoFi