Consumer complaint received 2019-11-29
Company: COAST PROFESSIONAL INC
State: IL
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:
In XXXX of XXXX, the US Dept. of Education recalled my federal student loans with XXXX XXXX and gave it to Coast Professional to manage. I was never notified of the change because Coast Professional incorrectly updated my contact information upon the transfer. Since XXXX XXXX is not able to provide payment information to Coast Professional, the payments stopped coming out of my account. Communications regarding the missed payments from Coast Professional went to the new address that they incorrectly updated and have now put my account in a default status. The only reason I found out about any of this is because the HR department at my work informed me of the upcoming garnishment to my next paycheck. When I contacted Coast Professional, the representative admitted that they had received undelivered statuses on the missed payment and garnishment notifications and told me it was my job to keep up to date contact information with the US Department of Education. When I contacted the US Department of Education, their records show that I updated my address in XX/XX/XXXX and that Coast Professional had since changed it on XX/XX/XXXX to an address I had not lived at for over three years. Due to Coast Service 's clerical error, I was told I would see an increase in my monthly payments on top of the garnishment. When I explained the situation to the US Department of Education, they were dismissive and said that all I can do is file a request for hearing ; the hearing process can take up to 60 days. Prior to the hearing, the garnishments and increased monthly payments ( which would more than triple my current payments ) would be owed. I told Coast Professional I was willing to pay for all missed monthly payments immediately if the default status is removed, the garnishments stopped, and the monthly payments returned to the prior amount. Per the US Department of Education, I have the right to a 30 day notice with regards to the garnishment, the nature and amount of debt, the opportunity to inspect and copy records relating to the debt, the right to object to the garnishment and the options to avoid garnishment by voluntary repayment. I was not afforded any of these due to Coast Professional 's clerical error. Coast Professional told me there was nothing I could do about the garnishment and they were not receptive to my proposed solution. Additionally, the representative from Coast Professional told me one option I had was to pay off the loan in full or settle for an amount less than was owed ; settling would negatively impact my credit score for a long time. The amount of the loan due and savings on the settlement were misquoted by more than 10 % of the balance on the loans. I have consulted with an  attorney and they have informed me that the cost of the pursuing legal action would outweigh any financial benefit I would realize. I cant help but feel like the address change was intentional and a tactic they use to collect additional money from people in situations like mine because they know there are minimal chances for repercussions.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation