JPMorgan Chase is the largest financial entity in the United States. Until a few years ago, it was also one of the largest lenders of both private and federal student loans.
In April of 2017, Chase Bank sold its private student loan portfolio to Navient. If you had Chase private student loans, that means your account transferred over to a new company.
In this article, we’ll help you understand what happened to Chase private student loans, as well as federal loans that were serviced by Chase Bank. We’ll also offer some alternatives to Chase Bank if you need a reliable private loan.
What Happened to Chase Private Student Loans?
You may be wondering: why did Chase stop offering private student loans? Why did they sell their entire portfolio of student loans to another lender, rather than continuing to collect payments as usual?
In short, Chase’s decision to stop offering student loans stemmed from new student loan regulations.
The creation of the Direct Loan program in 2010 meant Chase could no longer originate federal student loans. The change took a toll on Chase’s student loan division’s profit margins. In turn, it caused the company to rethink its position on student loans entirely.
Here’s the detailed timeline of what happened to Chase private student loans:
In the late ’00s, Chase Bank was earning substantial profits on private loans and federal loans alike:
As a private lender, Chase Bank originated its own private student loans.
Chase Bank also originated new federal student loans under the Federal Family Education Loan (FFEL) program.
In 2010, Congress eliminated the Federal Family Education Loan program. Under FFEL, private lenders like Chase Bank issued student loans that were subsidized and guaranteed by the U.S. government.
The Direct Federal Loan program replaced FFEL in 2010. Direct Loans are originated by the U.S. government directly and serviced by private companies.
Without the FFEL program, Chase Bank’s student loan arm became much less profitable.
Profits continued to fall for Chase private student loans until the bank decided to stop issuing loans in 2013.
However, the company kept its student loan division open for existing Chase student loans.
After another four years, Chase closed its student loan division entirely. The bank sold its remaining loan portfolio (all of the accounts that still had outstanding balances) to Navient in a $6.9 billion transaction.
There Are No Chase Private Student Loans: Here Are Some Alternatives
You might have been interested in Chase private student loans because of Chase’s reputation as a dependable financial institution.
Since Chase private student loans are no longer available, you’ll have to look elsewhere. When you’re choosing a private student loan lender, make sure to compare multiple companies and find the one that suits you best.
Additionally, borrow as much federal financial aid as you can, first, before turning to private loans. Federal student loans offer more protections, and often (depending on your credit score), better rates. Only borrow as much as you need.
Below are some valuable alternatives if you need a private student loan from a reputable lender.
Where Did Your Chase Private Student Loans Go?
Many borrowers are still repaying Chase student loans that originated prior to 2013. If you had Chase private student loans or a Chase federal loan under FFEL, Chase Bank is no longer your loan company.
If you had student loans with Chase, you should have received notification of the transfer. Make sure you check your records (paper mail and email) for that document.
If you’re still not sure where your loan ended up, you can confirm by looking at your latest loan statement.
You can also see if a transfer took place, and see who the new loan-holder is, by reviewing your credit report.
Your Chase student loan could have ended up with one of several student loan companies and servicers. Here’s an overview of the loan companies that own or service Chase Bank’s student loans now.
Chase Bank sold the majority of its student loan portfolio to Navient, the largest student loan servicer in the United States. This portfolio included both private loans and FFEL federal loans.
JPMorgan Chase and Navient finalized the $6.9 billion deal in 2017. The lenders announced the transfer in April of 2017 and should have notified you if it affected your loan account.
Conduent Education Services
The majority of Chase student loans ended up with Navient. However, Conduent Education Services (previously ACS Education Services) ended up as the servicer for some loans.
If your federal Chase student loans were serviced by Conduent before the Navient sale in 2017, they might still be maintained by the same company.
American Education Services
If your Chase private student loans were serviced by American Education Services (AES) before the Navient transaction in 2017, they might still be serviced by AES. However, some loans that were serviced by AES were transferred to Navient for loan servicing.
Who is Navient?
Navient is the largest loan servicer in the United States. It doesn’t originate loans on its own, but it handles other companies’ private student loans. Navient also services federal student loans, including new Direct Loans.
Navient has been locked in a legal battle with the Consumer Financial Protection Bureau (CFPB) since 2017. Navient allegedly mishandled loan payments and purposely misguided borrowers. Several states and the American Federation of Teachers have also launched lawsuits against the company for allegedly acting against borrowers’ best interests.
If your Chase private student loans transferred over to Navient, it’s a good idea to keep yourself informed about the pending legal action.
What to Expect if Navient Bought Your Chase Loan
When you took out a student loan with Chase, you probably didn’t expect another company to purchase your loan several years down the line. If you’re one of the borrowers whose student loan accounts were acquired by Navient, here’s what you can expect.
- You should be informed.
When the transfer took place, you should have received a welcome letter and notification from Navient, as well as a notification from Chase. The welcome package contained information for setting up your Navient account and managing your loans with the company. If you didn’t receive a notification, contact Navient.
- Your promissory note still applies.
When you agreed to loan terms and rates with Chase, you signed a promissory note. When a company buys a loan portfolio from another institution, the promissory notes for those loans go too. All of the features of your loan should stay the same and be upheld by Navient.
- You have options.
You always have options when it comes to your student loans. If you’re not happy with the way Navient has handled your student loans, see below for some options to change lenders.
What to Do with Your Chase Student Loans
If you have Chase loans that are now owned by Navient, and you’re not happy with your new lender, you have several options. Those options depend on whether your Chase loans are standard private loans or FFEL loans.
Chase Private Student Loans Options
If you had Chase private student loans, you now have student loans that are owned by Navient. If you want to switch lenders, the only way to do so is with refinancing. When you refinancing a student loan or loans, you pay off your current debt with new debt. You can borrow a new refinance loan to cover your existing balance, transferring your debt over to the new lender.
If you’re several years out of college and you’ve improved your credit since taking out your private loan, refinancing is something you should be considering anyway. Refinancing can allow you to get better rates and terms on your private student loan. It can also allow you to release a cosigner if you have one.
Before you commit to a particular refinance lender, make sure to compare rates from multiple companies. Consider banks and credit unions, but also online lenders. You can often get a better rate and skip unnecessary fees with an online-only lender.
Chase FFEL Loans Options
Federal loans, including loans from the now-defunct FFEL program, have more protections than private student loans. If you have an FFEL loan or loan, you can do any of the following:
- Consolidate your loans with a Direct Consolidation Loan.
- Apply for Income-Driven Repayment.
- See if you qualify for Public Service Loan Forgiveness and other forgiveness programs.
If you have federally-guaranteed loans that are eligible for any of the options above, you might not want to refinance with a private lender. Doing so will disqualify your loans from federal-sponsored loan programs.
However, if you’re sure you can get a better rate with a private lender through refinancing, and you’re not interested in the federal programs listed above, you can switch to a new lender and loan servicer through refinancing.
Do Banks Still Offer Private Student Loans?
With Chase choosing not to offer student loans anymore due to reduced profit margins, you might reasonably wonder if other banks are on the same path.
Most college students depend on federally-guaranteed student loans, including Direct Loans and, previously, FFEL loans. Fewer students rely on private student loans. Without the ability to offer federal student loans, banks and other private lenders have greatly-restricted earning potential in the student loan field.
Because banks can earn more in other areas (mortgages, auto loans, credit cards, etc.), many have chosen to stop offering student loans of any type.
The only major, a nationwide bank with a still-healthy student loan division is Wells Fargo.
What Are Your Private Student Loan Options Other than Banks?
With few major banks still offering private student loans, you’re left with less traditional options. Many of these are online-only lenders.
Another example is LendKey–an online lending service that connects you to hundreds of established banks and credit unions across the U.S.
If you prefer a lender that you can speak with in-person, consider your local credit union.
Chase Private Student Loans: Summary
To summarize: Chase Bank no longer offers or owns any student loans, federal or private. If you had a private student loan or an FFEL student loan through Chase, you still have to repay your loan. However, you’ll be making payments to another loan company or servicer.
If you’re not happy with Navient, the company that now owns your student loans, you can refinance with another lender. Refinancing will allow you to close your Navient account and even get better rates. However, think carefully before you refinance federal loans with a private lender; doing so will disqualify you from federal student loan forgiveness and repayment programs.
If you’re looking for a new student loan with the reliability of a major bank, consider working with one of the lenders recommended above. You can often get better rates and avoid fees by working with an online student lender or a credit union.
Compare the Best Student Loan Refinance Rates
Here are our top student loan refinance picks for 2019
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Student Debt Relief Loan Refinancing Advertiser Disclosure
College Ave: College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
College Ave Refi Education loans are not currently available to residents of Maine.
1 – The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation.
2 – $5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees. Information advertised valid as of 04/26/2019. Variable interest rates may increase after consummation.
3 – This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
ELFI: Subject to credit approval. Terms and conditions apply. To qualify for refinancing or student loans consolidation through ELFI, you must have at least $15,000 in student loan debt and must have earned a bachelor’s degree or higher from an approved post-secondary institution.
LendKey: Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
CommonBond: Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). 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.
Splash Financial: 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.com
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 qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest’s fixed-rate loan rates range from 3.89% APR (with autopay) to 7.89% APR (with autopay). Variable rate loan rates range from 2.50% APR (with autopay) to 7.27% APR (with autopay). 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 of 10 years or less. For loan terms of 10 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 0.26% and 5.03% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of April 23, 2019 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 04/23/19. 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 303 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, e-mail us at email@example.com, or call 888-601-2801 for more information on our student loan refinance product.