What Is a Direct Loan Servicing Center?


Quick Answer

A loan servicing center is the company that handles the billing services for federal student loans, The U.S. Department of Education explains. The service center works with students on repayment plans.

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Full Answer

The loan service center works with students on loan consolidation and other services that pertain to the disbursement and repayment of a federal student loan. If circumstances of a student receiving financial aid changes, he should contact the loan service center for assistance, the U.S. Department of Education notes. The loan service center generally contacts students after the first disbursement of the loan is complete. It's possible that at some time during the loan's terms the Department of Education may transfer the loan to another service center to ensure the student receives appropriate customer service.

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