A loan holder is the owner of your student loans. Most federal student loans are owned and held by the federal government through the Department of Education. There are some older federal student loans that are owned and held by a private company or state agency. It is important to know if your federal loans are held by the Department of Education or some other entity because your options for student loan relief may be different if the Department of Education does not own or hold your loans.
For private student loans, the loan holder is the company that owns your loans. It is possible that the loan holder may have changed since you first took out the loan.
The loan holder is usually a different company or agency than your loan servicer. A loan servicer is the company that the loan holder hires to manage your student loans.
Federal Loans – Who is the loan holder?
In most cases, if you have a federal student loan, the federal government, through the Department of Education, is the holder or owner of your loan. These loans are sometimes called “ED-held, “Department-held,” or “federally-held” loans.
Some older federal student loans, such as FFEL and Perkins Loans, are not always held by the federal government. These loans might instead be held by a private lender, state agency, or school. This is sometimes referred to as “commercially-held” or “non-ED-held” loans. If your loan is not held by the federal government and Department of Education, you may have to take steps before you can get certain loan relief, such as loan cancellation or forgiveness.
How can I tell if my loan is held by the federal government?
Log in to your account on studentaid.gov. On your Dashboard click on “View Details.” Scroll down to “Loan Breakdown.” If the name of the loan servicer starts with “Dept. of Ed” or “Default Management Collection System,” then that loan is held (owned) by the federal government. However, if the name of the loan servicer starts with either a company’s name or a school’s name, the loan is not held by the federal government.
Private Loan Holder – Who is the loan holder?
For private student loans, you can usually tell who the loan holder is by checking your credit report or reviewing any statements, bills, or loan agreements you have. You can also ask the company who is servicing your loan who the current holder of the loan is. It is possible that the loan holder may have changed since you first took out the loan.