If you’re going to take out loans to pay for college, you may soon become very familiar with American Education Services (AES). As one of the largest student loan servicers in the country, AES handles both federal and private loans for millions of students each year.
About American Education Services and AES student loans
AES was initially founded by the Pennsylvania Higher Education Assistance Agency (PHEAA) to help service loans through the (now defunct) Family Federal Education Loan Program (FFELP).
AES — known formally as “American Education Services — Pennsylvania Higher Education Assistance Agency” — is one of four primary federal student loan servicers (the other three being Nelnet, Navient and Great Lakes, which is owned by Navient but operates independently).
Note that you don’t get to choose your federal service provider. Instead, the government assigns you one.
AES and PHEAA also run the websites aessuccess.org, You Can Deal With It, and EducationPlanner.org in order to educate student borrowers on both the loan application process and their repayment options after graduation. Each provides various resources to help borrowers successfully manage education expenses.
As a student loan servicer, AES functions much like the others. While they don’t grant loans themselves, they’ll handle the monthly billing of your loan payment and field any repayment- or consolidation-related questions and concerns you may have about your loans.
Making AES student loan payments
American Education Services offers a variety of ways for borrowers to make student loan payments, including traditional options like paying via mail or telephone, and newer ones like paying online or on your mobile phone.
Students with loans serviced by AES can go to their website and sign up for an online account for instant access to their loans and a library of resources.
Through the online portal, borrowers can arrange to make a monthly one-time payment, and even schedule up to eight payments (in advance) every 60 days.
You can also take advantage of the direct debit program. This allows borrowers to automatically debit their payment (auto-pay) from a validated checking account and potentially qualify for an interest rate reduction for doing so.
AES student loan repayment options
Those having trouble making federal student loan payments can take advantage of AES sister company FedLoan Servicing to make a plan.
Some borrowers work with AES directly by calling customer service to discuss pausing their loan through deferment or forbearance. But there are other repayment options available through American Education Services, including:
- Graduated payment plan, where borrowers make smaller payments at first, with the amount increasing over time as the borrower’s income (hopefully) rises as well.
- Income-sensitive repayment plans, where the repayment amount is set based on net monthly income.
- 25-year Extended plan, which draws the typical 10-year repayment term out to 25 years, decreasing the monthly payments but increasing the total interest cost.
AES also helps borrowers with their private student debt, which it refers to as “alternative loans.” AES may not have as many options available for private loan repayment, but the website suggests calling customer service to discuss any issues in the event of financial difficulty.
It’s worth noting here that AES also works with borrowers seeking to consolidate or refinance their loans into a lower interest rate. Although it may be easier to consolidate with your provider directly, you can also look into refinancing your loans with a private lender. An extra benefit to refinance is that you might be able to get a lower interest rate, saving you a bundle of money, though you’ll need to shop around for the best deal and possibly find a cosigner if your credit isn’t strong.
Challenges with AES
Student loan servicers are often the subject of complaints by borrowers who feel they didn’t get the help they needed. According to a Consumer Financial Protection Bureau (CFPB) ombudsman report, in terms of the volume of complaints against the federal loan servicers, AES came in second to Navient (albeit a distant second), with almost 2,000 customer complaints between September 2016 and August 2017 (Navient had more than 10,000).
Based on the Consumer Financial Protection Bureau data, the top two complaints were receiving bad information about a loan and issues with how payments are handled.
Note that you can’t change your federal student loan service provider unless you consolidate or otherwise refinance your loans. Your federal loan could, however, be transferred to another provider by the government.
AES Contact Information
Office Hours: 7:30 AM – 9 PM (EST)
Mailing address for general correspondence:
American Education Services
P.O. Box 2461
Harrisburg, PA 17105-2461
Julie Evans contributed to this report.
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 2.98% APR (with Auto Pay) to 5.79% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.64% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of July 31, 2020, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 7/31/2020. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.
© 2020 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
All credit products are subject to credit approval.
Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.
As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.
Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.
Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.
Interest Rate: A simple annual rate that is applied to an unpaid balance.
Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of September 9, 2020. Information and rates are subject to change without notice.
3 Important Disclosures for SoFi.
4 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount.
The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.
To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of September 10, 2020.
5 Important Disclosures for CommonBond.
Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.16% effective Sep 1, 2020 and may increase after consummation.