Sallie Mae, the nation’s largest student lender, said Wednesday that it has helped 2 million customers resolve past due accounts in the past year, avoiding default on $38 billion in student loans.
Sallie Mae, formally known as SLM Corp., said it helps federal student loan customers repay the loans, even if they default. The efforts helped 14 percent of defaulted customers of the federal loan program re-establish clean credit, Sallie Mae said.
The company helps borrowers avoid default by granting a temporary payment deferment in cases of economic hardship, unemployment, military deployment and other circumstances. It also allows other solutions including interest-only payments or extended length of time to pay for some types of loans.
On federally guaranteed loan defaults, the Department of Education may garnish wages, seize income tax refunds and federal benefit payments, or make a student ineligible for other types of federal aid.
The company said 422,000 customers repaid student loans in the past 12 months.
Sallie Mae manages $182 billion in education loans and serves 10 million student and parent customers.
Shares of Sallie Mae fell 22 cents to close at $11.45.