Sallie Mae splitting into two companies?

[tattooedhusker]

Just received an email about Sallie Mae splitting into two companies, has anyone else recieved this email? What exactly does it mean, figured I would pass along the info to anyone who hasn't heard about it yet. Screenshot below:

[pizzadude]

I found this on the sallie mae website:

Sallie Mae (NASDAQ: SLM), formally SLM Corporation, announced today that its board of directors has unanimously approved the strategic separation of its loan management, servicing and asset recovery business, known as Navient, from its consumer banking business. Sallie Mae Bank’s consumer banking business will continue under the Sallie Mae brand. The board also set both the record date and the distribution date for the separation

http://news.salliemae.com/press-release/corporate-and-financial/sallie-mae-board-approves-strategic-...

[efranklin23]

---

@tattooedhusker wrote:

Just received an email about Sallie Mae splitting into two companies, has anyone else recieved this email? What exactly does it mean, figured I would pass along the info to anyone who hasn't heard about it yet. Screenshot below:

---

This is a good question. I got this same email regarding my account last week. I want to know if my Sallie Mae account Credit Line continues to report with the Navient name or do they open a new Navient Credit Line and close my current Sallie Mae Account? I was using the Sallie Mae Installment Credit history to build my Credit Score and don't want to report new Credit Lines as it does hit AAoA. 

[Rikku]

I received this email about a month ago. It sounds like the two companies will each have a separate focus. From the information below, which appears on their website, it sounds like Sallie Mae will no longer service federal loans, but focus on private loans. Navient will service both federal and private loans. I hope that they handle the transition well so that borrowers who have both federal and private loans with Sallie Mae do not end up with some of their loans at each company. Frankly, I don't care if mine move to Navient - I've had a good experience with Sallie Mae and I'm sure the new company will be run the same way - but I don't want half of my loans with each company.

The following information appears on their website:

Sallie Mae®is changing

Sallie Mae has now separated into two independent, publicly traded companies, Sallie Mae and NavientSM. Both companies are committed to delivering the highest level of service to help you succeed in your higher education goals. There is nothing you have to do at this time. We'll be sure to keep in touch with you every step of the way, so you'll know exactly what to do when the time comes.

What this transition means to you

We will continue to offer, manage, and service loans and other products, as usual. Over the upcoming months, we’ll deliver more information. In the meantime, continue to visit SallieMae.com for account access, new private loans, Upromise® rewards, and savings accounts, as well as education-related services, including financial tools, and insurance products.

Two new companies, each with its own focus

Sallie Mae®

You can continue to count on Sallie Mae to help you save, plan, and pay for college. With a range of private student loans (which Sallie Mae will originate and service), retail bank products, and other education-related services, the company will leverage its decades of experience to help make your dreams of education a reality.

Sallie Mae products and services include:

• New private student loans
• Servicing private student loans
• Upromise® rewards
• Banking products
• Insurance products
• Credit cards

Visit SallieMae.com

NavientSM

As a leader in education loan portfolio management, servicing and asset recovery, Navient will be dedicated to helping you along the path to financial success. Navient will be your servicer for federal loans, including Department of Education and FFELP loans. Navient will also service private loans.

Navient businesses will include:

• Servicing federal education loans (including Department of Education and FFELP loans)
• Servicing private student loans
• Asset recovery
• Loan management and acquisition
• Guarantor services

Visit Navient.com

[Rikku]

---

@efranklin23 wrote:

---

This is a good question. I got this same email regarding my account last week. I want to know if my Sallie Mae account Credit Line continues to report with the Navient name or do they open a new Navient Credit Line and close my current Sallie Mae Account? I was using the Sallie Mae Installment Credit history to build my Credit Score and don't want to report new Credit Lines as it does hit AAoA. 

---

It's won't report as a new loan because it is not a new loan or a refinanced loan - it's a transferred loan. While I haven't been through this specific transition yet, I've had SLs sold a few times. The old TLs report as "closed/transferred" (or something similar) and stop reporting the month that the loan is transferred - and as a positive closed account, the old TL will hang around on your CR for ten years. The new TL appears on your CR when the loan is tranferred, but it will report the original date that you opened the loan, as well as payment history going back 7 years. It may show the transfer date in the comments - but it might not.

If you have a thin file and no derogs on your SL, this can work to your advantage. Say your SL is 5 years old. The original TL will stop reporting, but it will continue to report as a closed loan for 10 years. Meanwhile, you're adding a second 5-year old TL. Not bad. If you have a thick file, it's not so exciting.

[efranklin23]

---

@Rikku wrote:

---

@efranklin23 wrote:

---

This is a good question. I got this same email regarding my account last week. I want to know if my Sallie Mae account Credit Line continues to report with the Navient name or do they open a new Navient Credit Line and close my current Sallie Mae Account? I was using the Sallie Mae Installment Credit history to build my Credit Score and don't want to report new Credit Lines as it does hit AAoA. 

---

It's won't report as a new loan because it is not a new loan or a refinanced loan - it's a transferred loan. While I haven't been through this specific transition yet, I've had SLs sold a few times. The old TLs report as "closed/transferred" (or something similar) and stop reporting the month that the loan is transferred - and as a positive closed account, the old TL will hang around on your CR for ten years. The new TL appears on your CR when the loan is tranferred, but it will report the original date that you opened the loan, as well as payment history going back 7 years. It may show the transfer date in the comments - but it might not.

If you have a thin file and no derogs on your SL, this can work to your advantage. Say your SL is 5 years old. The original TL will stop reporting, but it will continue to report as a closed loan for 10 years. Meanwhile, you're adding a second 5-year old TL. Not bad. If you have a thick file, it's not so exciting.

---

Thank you for the info. I really hope I keep the same credit line to build long installment credit lines as I dont have a mortgage. I have enough credit lines (have 6 credit cards) and I had a paid off car note reporting for about another 4 years. A couple of lenders have told me they'll like to see long credit lines on my account for better rates and higher limits. 

I just dont want to buy a house or get a car just to have long installment account history.