Firstmark is a student loan servicer responsible for managing the ongoing administration for private student loans around the country. Firstmark is a division of Nelnet, a student loan servicer covering over five million student loans on an ongoing basis. The Firstmark division has been around since 1997, building on the vast industry knowledge and experience of Nelnet.
As a loan servicer, Firstmark works with banks and other student loan lenders to manage the day-to-day administration and interactions with the borrowers. Importantly, Firstmark does not lend money itself but acts as the third-party interface between the borrower and the lender. Considering the increasing number of student loans issued through private lenders, Firstmark is a way for financial institutions to avoid the labor-intensive job of maintaining these student loans.
While the lenders still retain control over the application and approval process, Firstmark takes over the monthly payments, the customer service, and the client interface, as well as managing the problems associated with missed payments and defaulted loans. They work with many private student loan issuers, but one of their largest clients in Citizens Bank.
How Does Firstmark Interact With Borrowers?
Firstmark services all types of student loans, including refinanced loans. Importantly, the loan issuer will always maintain control over interest rates and term lengths, and it is then Firstmark's responsibility to ensure the borrower meets those terms.
For anyone with a student loan serviced through Firstmark their primary interaction will be through their monthly payment. Borrowers can go through the various customer channels supported by Firstmark to make online, mobile, or phone payments.
Borrowers can also schedule automatic withdrawals with Firstmark, who will then withdraw the monthly payment automatically from the borrower's bank account. Changes to payments are typically all made through Firstmark.
Again, Firstmark is not the lender but instead the third-party customer service agent used by the lender. They only service private student loans, and borrowers don't choose to use Firstmark specifically. Instead, the lender names Firstmark (one of many different student loan servicers) to take control of all the associated customer service.
What are the Benefits of Working With Firstmark?
Managing the daily administration of a student loan can sometimes be arduous for financial institutions, especially if their expertise lies elsewhere. Also, student borrowers often have little experience with the lending process, adding even more management to the loan process.
Working with a student loan servicer, like Firstmark, takes all the onus of management off the shoulders of the lender. Firstmark and its parent company Nelnet are almost entirely focused on the student loan market. They developed the technologies, knowledge base, and resources to specifically cater to this industry, meaning they are often much more of an authority on student loans than the lender.
Firstmark specializes in all things student loans, and working with them may be a better customer service experience than working directly with the lender. With that said, Firstmark cannot service federal student loans which always have better interest rates, repayment options, and security than private student loans. Private loans are regularly more expensive and typically have limited safety nets available.
While Firstmark acts as the face of the lending institution, and it strives to provide an exceptional customer service experience for all borrowers, at the end of the day their primary client is the lender. As an investment-grade rated servicer, they will work to provide positive returns for the financial institution on their private student loans. Their responsibility lies in ensuring loans are paid reliably, and through the appropriate channels.