Consumer complaint received 2016-03-24
Company: GREAT LAKES
State: IN
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with my lender or servicer
Sub-issue: Trouble with how payments are handled

Complaint:
Great Lakes Student Loans has been servicing my federal loans for several years now. I have been making large, timely monthly payments for the past two years. At the beginning of XXXX, with enough money saved up, I decided to pay off my smallest federal student loan. I called Great Lakes customer service and woman explained to me that I would have to make an online payment, but that she would make a " note '' in my file for how the payment should be allocated to the smallest loan to pay off the balance. She told me this would take XXXX5 business days. I checked one week later and my payment had been allocated equally among my XXXX federal loans. I called the Great Lakes customer service department again where a woman explained that sometimes it can take up to 10 business days for this to be allocated correctly, but that it would be allocated to the correct account going back to XXXX XXXX. 

I checked this morning and saw that while Great Lakes had allocated my payment to the correct loan, they had taken out my monthly payment from the large loan payment made on XXXX XXXX, despite the fact that my monthly payment was not due until the middle of the month. I called the Great Lakes customer service department AGAIN, when a customer service rep tells me that we ALWAYS have to make the monthly payment PRIOR to making ANOTHER payment to pay off a loan. Not only had this not been communicated to me EITHER time I called, Great Lakes informed me that this " monthly payment requirement '' is counted by the MONTH and NOT the billing cycle. So, even though I had made a $ 500 monthly payment in the middle of XXXX, since I wanted to pay off my loan on XXXX XXXX, I would have had to make ANOTHER {$500.00} payment in XXXX in addition to the {$4000.00} payment I had planned to make to pay off my loan. This is high way robbery of students who are working hard to pay of their loans ON TIME and AHEAD OF SCHEDULE. It is n't enough to not " communicate '' these necessary pieces of information. In order to FULLY pay off the loan, I was forced to pay ANOTHER {$360.00} TODAY. 

I expected so much more of a company that is servicing federal student loans. This is absolute XXXX that I have to call a company FOUR times to properly apply MY payment to the appropriate loan. Meanwhile, making hundreds of dollars of interest in the " confusion. '' Great Lakes MUST change this. Students should be allowed to pay off the balance of ANY loan at ANY time and not jump through rings of fire to do so. They need to change their website so that students can select which loan they want to pay-off and give them the capabilities to do so. Great Lakes needs to apparently TRAIN its customer service representatives so that they know " key '' pieces of information like the calendar month payment requirement. 

It truly is unbelievable how difficult this process was and all I was trying to do was pay-off the balance of XXXX of my loans. Great Lakes should be be ashamed.

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