Consumer complaint received 2018-08-17
Company: AES/PHEAA
State: MN
Product: Student loan
Sub-product: Private student loan
Issue: Dealing with your lender or servicer
Sub-issue: Trouble with how payments are being handled

Complaint:
In the Fall of XXXX, I co-signed for my daughters to receive a loan to attend College. When the loan went into repayment status my daughter did not pay the monthly obligation. I was contacted and told I had to make the payments since she was not honoring her obligation. I informed the student loan company that I would be making the monthly payment and to send me all communications concerning this debt moving forward. I have been making monthly payments on this debt since XX/XX/XXXX religiously. The monthly payment was on auto payment. Even when I filed bankruptcy in XXXX, I continued to make my monthly payments. American Education Service continued to send me monthly statements for this loan. 
My daughter filed bankruptcy in XXXX. I called American Education Services to let them know she had filed bankruptcy and want to make sure they knew I would continue making my monthly payments. The representative informed that it was my obligation to continue making the monthly payments since I wasnt the one that file bankruptcy. This wasnt an issue for me since that was my intent. 
In XXXX of XXXX I received a call from a collection Agency informing me that the student loan I co-signed for was in collections and payment is due in full. I thought this was a fraudulent call because the loan was on auto pay. I checked my account and the payment was coming out of my account. I thought the call was fraudulent. I got another call concerning this a week later. I asked the representative for documentation concerning the loan. I followed up with American Education Service and was told the loan was transferred because my daughter was in bankruptcy. 
I was never notified that the student loan was being transferred. When I asked the representative at American Education Service why I didnt receive notification. I was told it was because my daughter filed bankruptcy and they are not allowed to send out information to collect a debt. 
When I asked what they did with my monthly payments, I was told that the payments were being sent back to my daughter. I was so confused since they have it on record that I am making the monthly payment and it was coming out of my checking account. Then I followed up with the request that they continue accepting my monthly payments because I dont want my credit to be impacted by this. I was told that it was already reported to the credit report as a charge off account. That if I continued to make the payments it would be sent to my daughter because they no longer service the account. I was completely shocked. I was trying to make my payments but being told that they would not accept them. 
In conclusion, I took ownership of fulfilling my obligation as a co-signer of this student loan. I was making payment from the time this loan became due. I didnt refuse to make the loan payments. It was the creditor that refused to accept my monthly payment. Now, I am being sued because of it. I feel that XXXX XXXX XXXX XXXX XXXX, placed my debt in collections to collect additional interest and fees. I would like to be made whole. I have lost 11 payments totaling {$1400.00}, been refused credit due to the student loan being in charged off and assessed additional fees due to their refusal to accept my payment. Since, the creditors mistake, I am requesting that this debt be forgiven. 

LISTED BELOW ARE THE AREAS IN WHICH I FEEL I HAVE BEEN HARMED. 

DELAYING POSTING PAYMENTS Even though I was making my monthly payments on time, I continued to get late payments assessed to my account and additional interest accrued when they refused to accept my payments. From XX/XX/XXXX XX/XX/XXXX American Education Servicer proceeded to send my monthly payments to my daughter even though their records indicated that I was paying the student loan debt. I was never informed of this by anyone until I called in XXXX of XXXX. 

SERVICING TRANSFER It is my understanding that any public company that sales loans, assigns or transfer loans must provide notice to the customer when their loan is being sold, transferred or assigned to another company. The student loan I co-signed for was transferred without providing me with any notification. 

CREDIT REPORTING They payments XXXX XXXX XXXX XXXX XXXX XXXX received from XX/XX/XXXX XX/XX/XXXX were not reported to the credit bureau as payments being made on time. Instead it was reported that my last monthly payment was XX/XX/XXXX and the account was in collections/charged off. 

BANKRUPTCY FILING As indicated above my daughter filed Bankruptcy. It is my understanding that when a borrower files bankruptcy it only protects that individual. All collection activities against the borrower has to stop. However, Chapter XXXX automatic stay doesnt extend to the cosigner. The creditor is allowed to contact the co-signer to collect on the debt.

Company response to consumer: Closed with explanation