Consumer complaint received 2023-12-16
Company: MOHELA
State: KY
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:
Good afternoon to those concerned.

In short, I am seeking assistance from the CFPB for : 1. Assistance in understanding what I owe Mohela in a timely manner.

2. Transparency from Mohela when changes are made to how money is allocated to pay loans.

3. Raising concern of how onerous it is to contact Mohela, as their online/email assistance is nearly nonexistent and their call center availability is unreliable.

The full context is below.

I would like to discuss my concerns about how my loan payments have been handled under Mohela. I was one of the fortunate few who was able to pay my loan payments throughout the pandemic, despite a significant hit to my budget. I was transferred from my old loan company to Mohela, and from the beginning had problems. Mohela sets up its systems ( from my experience, at least ) to intentionally confuse student loan borrowers to incorrectly pay off their loans to increase interest. When I was first transferred, I noticed that my autopay amount under the last company was the same, but they had taken the whole amount of the payment ( {$250.00} ) and placed it under one loan instead of paying each individual loan 's required amount, causing interest to build. I called in and had that corrected, and was told that I had to go to the online portal and dictate how much I wanted to pay on each and every loan. After doing that, payments were fine for XXXX. Autopay worked as intended and all of my loans had their minimum payment amounts compensated. 

In XXXX of XXXX  I heard that Mohela was having servicing issues, so I decided to check the mail statements I had been receiving by request from Mohela as physical proof of payment receipts. I found that without my knowledge or consent, Mohela had taken 2 months of payments ( XXXX and XXXX ) and placed them under XXXX loan again, and not distributing the funds as I had so carefully worked out 2 years ago. I called Mohela and was able to get the funds properly dispersed, and was assured that it would not happen again. This call took nearly an hour to complete ( XXXX minutes in total ), with much of the call time spent in automated messages and waiting for an available representative. 

In early XXXX I filed for an IDR plan, and was informed by the FSA that my ongoing payments should be around $ XXXX {$16.00}. I checked that Mohela had received the notice, and assumed that it would take at least a month to process. On XX/XX/XXXX, I received the latest letter from Mohela regarding my previous loan payment that was processed via auto-withdrawal on XX/XX/XXXX. I saw that once again, the entire payment amount of {$250.00} was once again placed on only one loan. On XX/XX/XXXX I attempted to reach out to Mohela, only to find that they close their call centers early half of the week ( XXXX XXXX  eastern ), and have a varying schedule for when their call center is open. I also only learned that their call center was closed after 5 minutes of pre-recorded, unskippable audio notifications. During this call I was told through an AI assistant ( I assume ) that I will have {$38.00} withdrawn for my student loan payment this month, not the usual {$250.00}. I assumed that would be the amount withdrawn and accepted that I would make time to call them on the XXXX, since I do not have the time on the XXXX to call them, since it tends to be a long, often unpredictable endeavor. I logged in to the Mohela website just to get an idea of what loans had not been paid and found that Mohela was trying to pull an auto-payment in the total of {$250.00} for XX/XX/XXXX. As I am now thoroughly confused and unsure of what exactly is going on, I went to cancel autopay until I got some answers as to what I actually owe. The website told me that I could not cancel autopay. I also tried to find where the mysterious {$38.00} that was quoted had come from and was unable to find answers. I attempted to use the online contact function, but was told it was not available. 

As of now, I am contacting my bank to see if I can shut off auto-payments from Mohela since I can not do it from Mohela 's side, and can not contact them until the XXXX. 

I thank you for your time and look forward to hearing further developments regarding these issues.

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