Consumer complaint received 2022-04-25
Company: Navient Solutions, LLC.
State: LA
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with your lender or servicer
Sub-issue: Need information about your loan balance or loan terms

Complaint:
The Spousal Consolidation loan program originated in XXXX as a way for married borrowers with student loans to consolidate their individual student loans into XXXX loan for which they were both jointly and severally liable. Due to loan terms, couples would be forever bound to each other, equally responsible for each other 's debt, even if they later divorce, became XXXX or even died. However, by XXXX the disastrous spousal loan consolidation program was done away with by Congress. These loans essentially tied spouses to each other for life, even though they may have divorced or been a victim of spousal abuse. Today, there are only XXXX in payment, yet there could be many more in default or forbearance. 

Our Story In XXXX, with a balance of about {$130000.00} in student loans, we were advised and recommended by our loan servicer Sallie Mae ( a government entity, at that time ) to consolidate our loans into a FFELP Joint Spousal Consolidation loan. Based on our low income, again at the recommendation and advice of the loan servicer, we agreed to pay based on the Income Driven Repayment plan. The effect has been disastrous. To date, we have paid close to an unconscionable {$200000.00}. We have not missed XXXX payment, even during the Covid pandemic, as Spousal Consolidation loans did not qualify for the payment pause, granted to most all other student loans, by the President. Each year we continue to pay, yet make no progress on the principal balance. Currently we pay approximately {$1600.00} per month. The current balance owed is a shocking $ XXXX. This is predatory lending, an action allowable and partaken in by the U.S. government. 

Together, we have served the public in our careers for a combined forty-four years. Unfortunately, even with the requisite number of years, we do not qualify for public service loan forgiveness ( PSLF ) program because our FFEL joint spousal consolidation loan is " barred. '' In XXXX of XXXX President Biden, through the Department of Education declared a temporary expansion to the previously strenuous requirements of the Public Service Loan Forgiveness ( PSLF ) program. Specifically, the declaration/executive order stated, [ b ] orrowers who currently have FFEL, Perkins, or other non-Direct Loans, will get the benefit of this limited waiver if they applyby XX/XX/XXXX. Having an FFELP spousal consolidation loan I was excited and took the steps outlined in the Press Release. However, our current service provider Navient, informed us that FFELP Spousal Consolidation loans will not qualify under the waiver, despite the announcements that all FFELP loans would be waived. For the PSLF program waiver, FFELP borrowers must consolidate their FFELP loans via the federal direct consolidation loan program ( FDLP ) before XX/XX/XXXX, to qualify for the benefit. Currently Spousal Consolidation loans can not be re-consolidated into a FDLP consolidation loan, and therefore these public servants, after a lifetime of service, can not take advantage of the PSLF program. 

Generally, consolidating loans is a good financial plan. However, in this case when we consolidated our loans, we were unaware and never told : that we would never be allowed to reconsolidate into the direct consolidation loan ; that we would never be allowed to refinance at another rate ; that we would never be able to have the loan forgiven in bankruptcy ; that we would never be allowed to enter public loan service forgiveness. 

THERE ARE NO OTHER LOANS AS RESTRICTIVE AS THE FFELP JOINT SPOUSAL CONSOLIDATION LOAN, offered by or on behalf of the US Government. 

We have paid our original loan amounts plus an additional $ XXXX, yet still owe $ XXXX. While we agree that we should be responsible for paying our debt, which we have done, we believe it is irresponsible for the government to charge interest in the amount of $ XXXX over the life of a {$130000.00} student loan.

Company response to consumer: Closed with explanation