Consumer complaint received 2023-10-17
Company: Maximus Education, LLC dba Aidvantage
State: CO
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with your lender or servicer
Sub-issue: Trouble with how payments are being handled

Complaint:
I was involved in XXXX XXXX XXXX as well as the XXXX one-time reset which discharged ALL of my student loans. Aidvantage retained {$35000.00} in funds from the Federal Government granted to me via the XXXX XXXX XXXX in XXXX of XXXX. 

My loan servicer, Aidvantage, did not comply with the settlement agreement and no payments made to XXXX to this discharged loan were refunded to me.

Furthermore, the remaining loans were discharged via XXXX XXXX reset with an " effective date '' of XX/XX/XXXX. Federal mandate instructed Aidvantage to refund any payments made after this date to me as well. -no refunds were granted. 

1 ) All credits granted by the Education Department from the Settlement Agreement within XXXX XXXX XXXX were " reversed '' or taken by Aidvantage. Any payments made to the Education Department for this discharged loan were supposed to be returned to the borrower. ( {$18000.00} in credits were retained by Aidvantage granted in lieu of interest charged to the discharged loan ) 2 ) XX/XX/XXXX : Instead a " new consolidated loan was created '' and all credits and payments granted by the department of Education in agreement with the XXXXXXXX XXXX XXXXXXXX case and previously made by me were applied to this loan instead of being returned to the borrower. Interest was also recalculated at this time.

3 ) These remaining loans were then discharged by The XXXX  one time reset. The XXXX XXXX was supposed to be based on the original loans date that it entered repayment. Instead they used a consolidated loan date that was XXXX years later. All loans were supposed to be judged independently from when payment started and a refund for payments made after 20 years of the loans life ( effective date ) towards the loan refunded. This was not the case.

4 ) All funds and credits ( {$17000.00} ) after the listed " effective date '' of XXXX by the IDR were reversed by Aidvantage and no refund was received- again contradictory to Federal Mandate.

4a ) These funds were in response to delays by the Federal Government to offset interest charges - In a Federal Court. The Federal courts decisions can not be reversed by a corporate entity and all funds were granted after the effective date {$35000.00}. were granted to me, as class action member, to offset hardships and interest charges. Aidvantage retained all funds.

4b ) The credits from XXXX XXXX XXXX came in two phases. Phase 1 payments were directly applied to the remaining loan " before the effective date '' and reflected interest from the loan discharge by XXXXXXXX XXXX XXXXXXXX. No refund was given. 

4c ) The second half of the credits from this case were applied after the IDR effective date. Aidvantage then applied a payment reversal then another payment- for the $ XXXX listed in the ledger history available for download -but no refund has been received and a zero balance exists on Aidvantages website.

5 ) {$19000.00} was paid in interest even though no interest payments were no due. They also did not show any calculations for Amortized interest and front the notion " Interest is calculated daily based off the current principal balance of the loan ''. Which it is not... Aidvantage hides the fact that interest is amortized in advance based on the " stated '' payoff plan of the borrower. AKA : two borrowers who both have XXXX loans - pay a different rate because one is paying off a loan that is amortized for 10 years. The other is paying of a loan Amortizing after 20 years. - No interest calculations were provided by Aidvantage- The FSA Obundsman office reviewed the case and agree with Aidvantage confirming a - {$17000.00} balance.

6 ) The Federal Student Aid Obundsman office also agree 'd with Aidvantages numbers and, I qoute, " we agree with the interest calculations based off of the {$41000.00} loan dispersed. Funny - Aidvantage loan interest calculation was based off of {$50000.00} initial disbursement and not the Daily principal balance- which was only {$25000.00} after payments and credits on the first day that I entered into repayment. 
AKA : I paid interest on a {$50000.00} loan, amortized at 7 years. loan that was actually only {$25000.00}.

7 ) All interest was calculated off of the INITIAL LOAN AMOUNT - not daily balance. Resulting in an excess payment of : {$4800.00}

Company response to consumer: Closed with explanation