Student Loan Debt Collection- Who Actually Owns It?

Depending on the form of student loan, the federal government or private organizations own it. For example, the U.S. Department of Education owns federal student loans, whereas private student loans are controlled by the financial company that made them. Learn more about who owns student loans and how to determine who owns yours. 


  • In the United States, student loans are often owned by the federal government or financial organizations. 
  • Almost all student loans are completely guaranteed by the federal government. 
  • Some student debts are managed by organizations such as Sallie Mae or a third-party loan servicing organization. 
  • Direct Loans, Perkins Loans, and Federal Family Education Loans are examples of federal student loans. 
  • Federal loans may be owned by private enterprises. 

 Ownership of Student Loans 

A student loan is often owned by the federal government or a financial institution. A student loan may be generated by one institution, owned by another, and guaranteed by a third. Other agencies can also service it. A loan servicer, which can change frequently, normally oversees the invoicing process, takes payments, and serves as the borrower’s point of contact for issues and complaints. 

As a result, knowing who owns your student loan might be tricky because the person in charge of your loan may be different from your primary contact with the loan. If you refinance your debt, the situation may become even more challenging.

The owner of your student loan will vary depending on the sort of loan you took out; however, the federal government will almost certainly play a part in your loan, such as backing it. Direct Loans, Perkins Loans, and Federal Family Education Loans are examples of federal student loans. However, keep in mind that private corporations can hold government loans. 

The majority of student loan originators are huge banking institutions, like large banks or the federal government. However, once a loan is originated, it becomes an asset that may be purchased or sold on the market. Banks frequently sell educational loans to other middlemen in order to strengthen their capital ratio and offer more loans. 

 Important* The government fully guarantees Almost every student loan, so banking institutions can sell them for a higher price because default risk is not transferred with the asset. 

Non-Government Owners 

The lender or a third-party loan servicing corporation holds the majority of student loans that are not owned by the government. Both originators and third parties can undertake in-house student loan debt collection services or outsource that responsibility to a student loan collection agency. 

Many student debts are also owned by private corporations having connections with the Department of Education. 

The Federal Government as Creditor 

According to Federal Reserve data, total U.S. student loan debt will reach more than $1.7 trillion in the fourth quarter of 2022, with total U.S. student loan debt reaching more than $1.7 trillion in the fourth quarter of 2022. The federal government owns the majority of that debt. 

Prior to the Affordable Care Act, the bulk of student loans were originated by private lenders but insured by the government, which meant that taxpayers would foot the bill if student borrowers failed. The Congressional Budget Office (CBO) projected in 2010 that only 55% of loans fell into this category, compared to approximately 93% currently. 

The federal government did not hold any student loans at one time while guaranteeing loans since at least 1965. In 2020, student debts accounted for roughly 20% of all government assets in the United States. 

How to Determine Who Owns Your Student Loan 

You have various options for determining who owns your student loan. To begin, you should obtain a copy of your credit report from one of the three major credit bureaus: Experian, Equifax, and TransUnion. Your student loan debt collection agency may be listed on your credit record. 

You can also find out who owns your student loan by contacting the financial assistance department at your school or college. Finally, you can visit the Federal Student Aid website of the United States Department of Education. 

Once you know who owns your debt, you can update your contact details and learn about any relief programs you may be eligible for. You can profit from potential advantages such as income-driven repayment arrangements. 

The Bottom Line 

A professional agency offers everything under one roof. It’s essential to keep in mind that delinquency can have a significant impact on your business. You can always stay on the safer side with the help of a professional agency. When you initiate the process, the experts will run an overview of all delinquent accounts. After that, there’s complete planning over the context and implementation of strategies.

Knowing who actually owns and services your student loan might help you keep your loan current and understand the perks and relief programs available to you. To determine who owns your student loan, contact your institution’s financial aid office and the U.S. Department of Education’s Federal Student Aid website. 

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