Higher Education Loan Authority of the State of Missouri facts for kids
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| Agency overview | |
|---|---|
| Formed | 1981 |
| Jurisdiction | State government of Missouri |
| Headquarters | St. Louis, Missouri, U.S. |
| Employees | 625 (2013) |
The Higher Education Loan Authority of the State of Missouri, aka the Missouri Higher Education Loan Authority or MOHELA, is one of the largest holders and servicers of student loans in the United States. It is headquartered in St. Louis, Missouri.
MOHELA is among the 10 largest student loan servicers, alongside FedLoan Servicing (PHEAA), Granite State (GSMR), HESC/Edfinancial, Navient, Nelnet, and OSLA Servicing (as well as previously CornerStone and Great Lakes Educational Loan Services, Inc.).
Created in 1981 as a quasi-governmental entity, MOHELA participated in the Federal Family Education Loan Program (FFELP) for nearly three decades. While fully supporting a portfolio of legacy student loans through FFELP, MOHELA completed steps to become a contractor to service federal student loans. MOHELA received the first not-for-profit (NFP) contract and began servicing student loans owned by the federal government under the U.S. Department of Education Federal Loan Program in October 2011.
MOHELA was created, in part, to help students obtain low-cost education loans. MOHELA has provided a total of more than $300 million in loan forgiveness. MOHELA also formed the Missouri Scholarship Foundation, a tax-exempt nonprofit 501(c)(3) organization, to ease higher education costs for students.
More than 625 full-time MOHELA staff members work with the Department of Education, families, lenders, schools and students servicing upwards of $39 billion in student loans. A second loan servicing center opened in Columbia, Missouri in 2013.
Contents
History and structure
As a “public instrumentality and body politic and corporate of the state of Missouri,” MOHELA was created in 1981 by legislation signed into law by Governor Christopher S. “Kit” Bond. MOHELA was established to “…assure that all eligible post-secondary education students have access to student loans” (RSMo 173.360). The “authority” is governed by seven board members operating on alternating five-year terms; five of whom are appointed by the Governor of the state of Missouri, subject to the advice and consent of the Missouri Senate, and two others are representatives from the Missouri Coordinating Board of Higher Education – one of which is a permanent seat to be filled by that agency’s commissioner.
Initial funding to establish operations came from a $65 million bank letter of credit, guaranteed by several of the then members, and was repaid following the issuance of bonds. Since that original issue, MOHELA has generated its own funding from beginning to present day. From its humble beginnings with fewer than ten employees, MOHELA has grown to more than 625 full-time staff members and works with students, schools and lenders in all 50 states.
Income and finance
MOHELA supports its mission and pays operating costs exclusively from revenues derived from its own operations. Net income from student loans is typically between one cent to half a cent on every dollar on loans that MOHELA owns. A majority of MOHELA’s serviced portfolio earn a fee paid to MOHELA from the Department of Education.
National recognition
MOHELA was named an "Exceptional Performer" by the U.S. Department of Education. MOHELA maintained a compliance performance rating of 97 percent in converting federal student loans to repayment, collecting delinquent loans, and filing timely claims with guaranty agencies. MOHELA leaders also have been elected to industry and community board and serve on a variety of industry-related committees.
MOHELA became the first servicer in the not-for-profit (NFP) sector to receive a contract and began servicing student loans owned by the federal government under the U.S. Department of Education Federal Loan Program in October 2011.
Types of student loans owned and serviced by MOHELA
- Federal Subsidized and Unsubsidized Stafford Loans
- Federal Perkins Loans
- Federal PLUS Loans
- Federal GradPLUS Loans
- Federal Student Loan Consolidation
- Private Alternative Loans
• MOHELA • Missouri Department of Higher Education • U.S. Department of Education • Federal Student Loan Servicers • HCERA/SAFRA - Not-For-Profit (NFP) Servicer Program
