Consumer complaint received 2023-09-27
Company: MOHELA
State: MD
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with your lender or servicer
Sub-issue: Received bad information about your loan

Complaint:
Here is the original message I sent to Mohela : Dear XXXX XXXX, I hope this letter finds you well. I am writing to address some significant concerns I have regarding the handling of my student loans by the XXXX organization. I believe it is crucial to bring these matters to your attention, even though I understand that XXXX XXXX is no longer my servicer. My aim is to request that the federal government and/or Mohela, my current servicer, thoroughly investigate this matter regarding the removal of my loans due to what I believe to be illegal practices by student loan companies. First and foremost, I wish to highlight several instances where your organization 's actions appeared to be inconsistent and, in some cases, legally questionable. These actions have not only affected my financial stability but have also had severe emotional repercussions. XXXX and Denial of Application : I experienced a perplexing situation wherein my application for loan assistance was initially accepted, only to be subsequently denied without a clear explanation. This uncertainty caused significant anxiety and stress, impacting my overall well-being. Loan Transfer and Redirection : My loans were transferred to XXXX XXXX and then redirected back to XXXX. These abrupt changes in loan servicing created administrative chaos and made it challenging to manage my financial obligations effectively. The constant uncertainty surrounding the status of my loans has led to persistent anxiety. Misinformation About Eligibility : I was informed that I needed to make ten years of payments when, in reality, the program 's requirements were different. This misinformation led to unnecessary financial burdens, mounting stress, and sleepless nights as I struggled to comprehend the situation. Failure to Process Submitted Forms : On several occasions, I resubmitted required forms, only to receive continued denials without any follow-up or clarification on the specific issues that led to these denials. This lack of communication further exacerbated my anxiety. Increased Interest Rates : The fluctuation in loan servicing caused delays in processing, resulting in heightened interest rates. These additional costs have further strained my already fragile financial situation, intensifying my anxiety. Forbearance Without Consent : My student loans were placed into forbearance for a year without my consent or request. This adversely affected my credit score and, consequently, my ability to secure housing. At one point, I lost home ownership due to the negative impact on my debt-to-income ratio, causing immense stress and emotional distress. In addition to the significant financial hardships caused by these issues, the mental stress and anxiety have taken a considerable toll on my overall well-being. The constant turmoil and uncertainty surrounding my student loans have affected my ability to focus, maintain healthy relationships, and enjoy life without persistent worry. While I understand that XXXX XXXX is no longer my servicer, I believe it is imperative that the federal government and/or Mohela thoroughly investigate the matters I have raised regarding the removal of my loans due to what I believe to be illegal practices by student loan companies. I implore you to thoroughly investigate this matter and take corrective action as necessary. Ensuring fair and consistent loan servicing practices is essential for individuals like me who rely on these programs to pursue higher education and achieve financial stability. I appreciate your prompt attention to this matter and look forward to any assistance and support you can provide in addressing these concerns. 

MOHELA 's XXXX : Dear XXXX XXXX, Thank you for contacting MOHELA. Our records indicate, a response was provided to many of your concerns with a document dated for XX/XX/XXXX. A digital copy has been sent to your web account in a separate correspondence. If you would like to report concerns with a prior servicer, you will need to contact studentaid.gov and file a complaint with them. The Revised Pay as You Earn ( REPAYE ) plan has changed to the Saving on A Valuable Education ( SAVE ) plan which may significantly decrease monthly payment amounts compared to all other IDR plans. If you are already enrolled in the REPAYE Plan you will automatically be put on the SAVE Plan. More information on these upcoming changes is available at : https : //studentaid.gov/SAVE. Congress recently passed a law preventing further extensions of the payment pause. Student loan interest resumed on XX/XX/XXXX, and payments will be due starting in XXXX. We will notify borrowers well before payments restart. The earliest first payment due date after the payment pause ends will be no sooner than XX/XX/XXXX. On XX/XX/XXXX, the XXXX Department of Education ( XXXX ) announced several changes and updates that will bring borrowers closer to forgiveness under income-driven repayment ( IDR ) plans. These adjustments to accounts include conducting a one-time revision of IDR payment counters to address past inaccuracies and permanently fix IDR payment counting by reforming EDs IDR tracking procedures going forward. Based on the newly eligible months from the one-time account adjustment, borrowers who have reached 240 or 300 months ( as applicable ) worth of payments for IDR forgiveness or 120 months of PSLF will begin to see their loans forgiven in XXXX. The Department will continue to discharge loans as borrowers reach the months needed for forgiveness. All other borrowers will see their accounts update in XXXX. More information on these upcoming changes is available at : https : //studentaid.gov/announcements-events/idr-account-adjustment. If you have any other questions or concerns, please contact us at the number listed below. Sincerely, Customer Advocacy Team Phone XXXX, Fax XXXX, TDD Dial XXXX, XXXX M, XXXX XXXX XXXX XXXX XXXX Correspondence : XXXX XXXX XXXX, XXXX, MO XXXX Payment : Department of Education MOHELA XXXX XXXX XXXX XXXX XXXX XXXX, MO XXXX mohela.com fb.com/MOHELA.usa @ MOHELA This message, from a debt collector, is an attempt to collect a debt. Any information obtained will be used for that purpose. California residents : The state Rosenthal Fair Debt Collection Practices Act and the federal Fair Debt Collection Practices Act require that, except under unusual circumstances, collectors may not contact you before 8 a.m. or after 9 p.m. They may not harass you by using threats of violence or arrest or by using obscene language. Collectors may not use false or misleading statements or call you at work if they know or have reason to know that you may not receive personal calls at work. For the most part, collectors may not tell another person, other than your attorney or spouse, about your debt. Collectors may contact another person to confirm your location or enforce a judgment. For more information about debt collection activities, you may contact the Federal Trade Commission at 877.FTC.HELP or www.ftc.gov. ATTENTION MASSACHUSETTS BORROWERS : If you are struggling with your student loans, please fill out the form located at : https : //www.mass.gov/forms/submit-a-student-loan-help-request to get help from the Ombudsman 's Student Loan Assistance Unit . State of XXXX 's Student Loan Assistance Unit XXXX My follow-up response XX/XX/XXXX : Dear Mohela, I would like to thank you for your recent response to my complaint. While I appreciate your prompt attention, I would like to address a few points in your reply. 

First and foremost, I want to emphasize that when you acquired someone else 's debt, you also assumed the associated responsibilities, including rectifying any issues tied to those loans. My initial complaint was a direct result of concerns related to the handling of my student loans, which I believe have been mishandled. 

It is essential to recognize that the loans in question were previously managed by XXXX, an entity that has since been closed. This has raised significant challenges in addressing and resolving the issues I have encountered. I understand that XXXX ' closure is not under your control, but it does not absolve you of the responsibility to address these concerns. 

I would also like to inform you that a formal complaint has already been filed against Fedloans due to their actions in managing my student loans. In light of the transfer of these loans to Mohela, the issues persist and continue to affect my financial situation. Therefore, I intend to file a similar complaint against Mohela, as the issues remain unresolved. 

My primary goal in raising these concerns is to ensure that the loans currently under your administration are accurately managed and that the challenges I've faced are properly addressed. I believe it is crucial to recognize the legitimacy of the issues at hand and take proactive steps to resolve them. 

I appreciate your understanding of the situation and look forward to a response that acknowledges the specific concerns I have outlined. It is my hope that we can work together to reach a satisfactory resolution. 

Sincerely, XXXX XXXX

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation