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Student Loans

AES Student Loans Review

There are a plethora of student loan servicers, but few are as well-known as American Education Services (AES), which is one of the largest servicers in the nation.

Established in 1963 by the Pennsylvania Higher Education Assistance Agency (PHEAA), AES was created to assist in the management of loans funded as part of the Federal Family Education Loan Program (FFELP).

AES services both private student loans—many of which are owned by National Collegiate Student Loan Trusts—and federal loans. However, it should be noted that PHEAA carries out loan servicing obligations under AES as well as FedLoan Servicing, which was specifically created to manage federal loans.

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What Does AES Student Loans Do?

According to the National Student Loan Data System, AES services over 4.48 million student loan borrowers and manages an outstanding balance of $155.7 billion in student debt. Included in this balance are loans that originated as part of the Federal Family Education Loan Program.

According to, as part of this program “private lenders made federal student loans to students, and guaranty agencies insured these funds, which were in turn reinsured by the federal government.”

This program ended in 2010, and today all federal loans are originated by the Department of Education. However, there are still millions of borrowers currently repaying loans that originated through FFEL, and AES continues to service those loans.

AES is a Servicer, Not a Lender

This is an important distinction as borrowers cannot apply for a loan on the AES site and AES does not originate loans.

Instead, borrowers can apply for a loan through a qualified lender or financial institution, including the Department of Education. Lenders are responsible for disbursing funds and setting loan rates and terms.

Loan Management

A servicer like AES, on the other hand, is responsible for loan management. As such, AES accepts and processes student loan payments; supports the various federal repayment programs, including those outlined below; educates borrowers on their repayment options and rights, including those that dictate the availability of deferment or forbearance options; and ultimately acts as a middleman between the lender and the borrower.

For the most part, borrowers manage their loans without engaging with the lender; it’s the servicer that becomes the face of the loan.

Repayment Options Through AES

Much like any other loan servicer, AES student loans offers a variety of repayment plans. Borrowers with private loans serviced by AES must contact the servicer to discuss repayment options.

Borrowers with federal loans, however, that are serviced by AES may be eligible for one or more of the repayment options currently offered by the federal government aside from the Standard 10-Year plan. They include the following:

  • Graduated Repayment Plan: Borrowers making payments under this plan can make smaller payments at the beginning of their repayment period and over time, loan payments increase. In some cases, borrowers on this plan can make interest-only payments for a limited amount of time.
  • Income-Based Repayment (IBR): The IBR program allows borrowers to make payments based on their income, family size, and eligible loan debt. Payments are either 10 or 15 percent of the borrower’s discretionary income, depending on when the loan was secured. Loans on the IBR Plan are eligible for forgiveness after 20 to 25 years of eligible monthly payments, depending on the year the loan was obtained.
  • Revised Pay As You Earn Repayment Plan (REPAYE): Similar to the IBR program, but with fewer restrictions, the REPAYE Plan requires borrowers to make monthly payments that amount to “generally” 10 percent of their discretionary income. Undergraduate loans that are being repaid as part of the REPAYE plan are eligible for forgiveness in 20 years, while those that are used for graduate or professional study are eligible for forgiveness after 25 years.
  • Income-Contingent Repayment Plan (ICR): The ICR plan allows borrowers to pay the lesser of the following: 20 percent of their discretionary income or what they would pay on a fixed repayment plan over the course of 12 years, with adjustments made according to the borrower’s income. Loans included in this plan become eligible for forgiveness after 25 years of eligible monthly payments.

A full list of repayment options is available on AES’s “Repayment Plans” page.

If you need assistance with your monthly payments, are interested in any of the income-driven plans, or believe you are eligible for public service loan forgiveness, you can contact AES at 1-800-233-0057. Customer service specialists are available Monday through Friday from 7:30 a.m. to 9:00 p.m. (ET).

AES customers can also email AES by logging into their account and using the onsite email contact option.

What to Do If You Want to Change Servicers

Unfortunately, there is no easy way to change your servicer if you are unhappy with AES.

If you have federal student loans, you could try consolidating your loans through the Direct Consolidation Loan Program, which may result in you having a new servicer.

Alternatively, if you have federal and/or private loans, you could refinance your loans with a private lender. You may also be eligible for a lower interest rate or new repayment term that better fits your needs as well. Note that you will lose access to federal benefits and repayment plans if you refinance federal student loans.

Problems with AES Student Loan Servicing

Despite being a leading student loan servicer for several years, complaints and negative AES Student Loans reviews are easy to find.

Though complaints vary, and not everyone is indicative of a problematic pattern, borrower complaints frequently deal with communication issues, between both the borrower and the servicer and the servicer and major credit bureaus.

Misinformation & Poor Communication

Loans are confusing, and even when armed with the best information, making decisions about loan repayment can be difficult. That issue is expounded when the information is false or missing altogether.

Such is the case for many borrowers, according to the Consumer Financial Protection Bureau complaints.

The site is littered with tales of failed auto payments; lack of communications regarding loans that fell into default status, often for years before being addressed; and a slew of other dismaying stories that culminated with destroyed credit scores, unnecessarily accrued interest, and co-signer woes.

False Credit Reporting

Student loan debt can take a toll on your credit—directly and indirectly—but for many AES customers, the impact was even more severe due to inaccuracies that appeared on their credit report.

Though these complaints varied, several borrowers reported that loans were showing up as delinquent even though they were taking advantage of forbearances, which places a momentary pause on repayment.

Others found they were victims of identity theft, with erroneous loan accounts showing up on their credit reports.

Bottom Line

As a long-time figure in the student loan industry, AES has a vast collection of knowledge and experience that frequently benefits borrowers, particularly when it comes to identifying the best way to approach loan repayment.

Additionally, they offer a mobile app as well as other repayment methods (e.g., direct debit, payment by phone, etc.)

However, AES, like most loan servicers, is not without faults, and as such, borrowers working with AES must remain diligent in their loan management efforts, and that includes actively reviewing account information as well as their credit report.