Consumer complaint received 2023-10-20
Company: MOHELA
State: CA
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:
I have been transferred to a new student loan servicer called MOHELA ( this is the fourth servicer I have been transferred to, many of the past services found guilty of malfeasance ). My last servicer had an option to make principal-only payments beyond the regular monthly payment by checking a box in one 's account. I have found that MOHELA has for some unexplained reason decided not to offer this option. Last week and spoke with a representative about making such payments, and they said I could either mail a check with instructions (? ) or make a payment online and tell a customer representative that the recent payment is to be made towards the principal only. After my regular monthly auto-debit payment went through on XX/XX/XXXX, I made payments to MOHELA totaling the principal amount, {$100000.00} on Friday XX/XX/XXXX. 

I called MOHELA on Monday XX/XX/XXXX and spoke with a trainee, who said I could not apply payments to the principal, which is wrong, but as this was a trainee I explained these were payments made after the original monthly payment. The trainee said it was above his ability and so transferred me to an advanced representative who was apparently able to process the request for MOHELA on that same day. I asked for confirmation of this request to be sent to me, but he said that this was not possible, however, I should wait 2-3 business days for the request to be processed and check my account for this confirmation. 

I checked my account today, Friday XX/XX/XXXX, and the request had not been applied, and there wasn't any evidence that it had even been made. What's more, I could see that this huge ( for me ) payment was made to the interest and the principal, not as I instructed. 

I called this morning, and received another trainee, who transferred me to another advanced representative, who said that, again, I was not allowed to make payments towards principal. I said this was wrong, and asked to speak to a supervisor. After putting me on hold multiple times, the representative told me I could not speak to her supervisor and that I was given " wrong information '' by the other representatives, and that she could not help me out. She saw the record of my conversation from Monday, but nevertheless said that the request made last Monday could not be made, which, again, is just untrue. 

After I insisted this could in fact be done, she lost her temper at me. I said I nevertheless needed to speak to someone else who could help me out. After waiting another hour plus on hold, I finally spoke to someone else at MOHELA on the supervisor level, who supposedly made some other additional adjustment on my account ( adjusting the payment to next month, rather than XXXX, which is not something I requested at all, but was apparently the reason the request was not going through ) and said my request should be completed within 5-7 business days. I asked once again if I could have record of this request given the previous conversation, and the supervisor level representative said this wasn't possible, but, again, to look out for confirmation in my account as before. This supervisor level representative said they weren't sure where the previous advanced representative got their information. I have still have no record or extra assurances that I will not have to call back again, for the third time, next week and make sure MOHELA is doing their job. 

I've had issues with student loans servicers in the past, and have raised flags before about what seems to be deliberate opaqueness built into the system. This is my first month with MOHELA, and this is was by far more frustrating than my past experiences. My previous loan services simply lost paperwork and weren't able to give me basic information on my loan payments, which was bad enough -- Unlike MOHELA however, they did not start arguments with me about what can and can't be done with payments, and did not tell me that I was not able to receive confirmation of steps taken along the process. Further, you would expect that after being transferred from one servicer to another an improvement in service will be part of the package -- How does MOHELA justify not including an option to make payments towards the principal through your own account? This is not negligence or incompetence, it is the design of a system that takes a very cynical view towards students ' actual ability to pay students loans off, and is tailor made to mislead and confuse.

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