Student Loan Nonprofit Loses Contract, to Cut Jobs

HELENA, Mont. (AP) — A nonprofit company that services federal student loans plans to cut 10 to 15 jobs in Helena after losing a contract under the recent federal budget deal.

Student Assistance Foundation spokeswoman Carolyn Bright tells the Independent Record (http://bit.ly/1mvP7Ap) SAF must also make some other cost and benefit reductions. Bright says early retirement options have been offered to about 30 employees.

SAF and its for-profit subsidiary Tru Student Inc. had been gearing up to service federal loans for several years.

The federal government assumed direct control of federal student loans in 2010 instead of guaranteeing loans offered by other lenders, such as SAF. While some nonprofits were allowed to service some loans, the December 2012 budget bill struck that provision.

SAF services a $2.9 billion loan portfolio for 141,000 borrowers.