Consumer complaint received 2018-04-18
Company: GREAT LAKES
State: FL
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:
( 1 ) Excess payment seems to be applied incorrectly across two loans. I have been registered for the standard excess payment allocation since graduation, XX/XX/XXXX. However, a substantial fraction of excess payment has been applied to the principal of the lower-interest rate loan for several months. Numerical context : - Autopaying $ XXXX/mo since XX/XX/XXXX. 
- Total Scheduled Monthly Payment is $ XXXX/mo. 
- One loan with period beginning XX/XX/XXXX, disbursed $ XXXX@ 5.96 % fixed, according to NSLDS student data extract ( not available from Great Lakes or from master promissory note ) Scheduled Monthly Payment is {$43.00}. 
- One loan with period beginning XX/XX/XXXX, disbursed $ XXXX@ 5.59 % fixed, according to NSLDS student data extract ( not available from Great Lakes or from master promissory note ) Scheduled Monthly Payment is {$280.00}. 

The Scheduled Monthly Payments by individual loan seem like they might be reversed. Regardless, assuming they are correct, the changes to the individual loan balances - and total account balance - do not reflect the rules for applying payments to individual loans ' Scheduled Monthly Payments first, then excess to the loan with the highest interest rate. 

( 2 ) Servicer claims that statements prior to XX/XX/XXXX can not be provided. I have bank statements showing transactions paid out to loan servicer monthly in XX/XX/XXXX - XX/XX/XXXX and every month after. Having these statements will be important for verifying that early payments were applied correctly. 

Actions taken : * Set up spreadsheet model of monthly payments to trace calculation in statements provided online by Great Lakes. Confirmed monthly interest figures within a few dollars ( possibly related to date alignment ), but totally unable to reproduce reported changes to statement balances resulting from excess payments using loan terms, including master promissory note and my NSLDS student data records. 
* Contacted Great Lakes call center to inquire about ( 2 ) and ( 1 ). Initial representative was unable to explain ( 1 ) and admitted he had no idea how to justify from my records, and asserted that statements were not generated for account status before XX/XX/XXXX and therefore not retrievable. Requested to speak to supervisor. Supervisor asserted that a " split factor '' applied to individual loans made within the account when Scheduled Monthly Payment is applied. Supervisor refused to provide " split factor '' and insisted that it was possibly available in Master Promissory Note, but would not identify where it is derived. In fact, it is not available in Master Promissory Note. If I use the Scheduled Monthly Payment amounts for each year 's loan individually, provided in NSLDS student data record download ( MyStudentData.txt ), I still find overpayments towards the low-interest loan. 
* Contacted NSLDS by phone. Was advised that CFPB was involved in litigation against another student loan servicer for similar behavior towards borrowers repaying loans early, and recommended I contact CFPB.

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