Consumer complaint received 2017-02-09
Company: Navient Solutions, LLC.
State: PA
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:
I borrowed roughly {$22000.00} to attend college. I was asked to pay close to {$370.00} a month in student loans once I graduated. I could, in no way, afford to make this payment. I was instructed by my loan servicer ( XXXX XXXX at that time ) to defer my payments for a year or XXXX until I could afford to make the payments, stating how many borrowers, in my same situation, opted for this option. I agreed to defer for a year and felt relieved that I had a year to better my financial situation with my new career and could then afford to start repaying my loans. I did not realize that by deferring that I would accrue such a substantial amount of what is called " capitalized interest. '' Now I do blame myself for not keeping a closer eye on my account, however at the time I did not own a computer, nor could I afford XXXX so I did not utilize online " anything '' for any of my accounts. Several years of deferring later, I opened my online account, mainly due to XXXX XXXX being taken over by Navient and now having a tablet ( given as a gift! ) I WAS SHOCKED ... .I realized that I had accrued almost {$7000.00} in capitalized interest. I consulted with Navient and was told to start paying {$150.00} a month. I did this for about a year an a half. I noticed that none of the money I was paying was going to towards the principal and all of it was going to interest. I called and was told by Navient that I had to pay off the capitalized interest first before it would start to come off of my principal. I was once again devastated. I realized that as I was " paying off the capitalized interest first '', I was continuing to accrue interest on the total account balance ... all that capitalized interest accruing interest ... .I was getting nowhere! I was paying every month and every time I looked, my account balance was higher. I called Navient and was told that I needed to pay {$390.00} a month to get ahead on my loan. I started paying {$400.00} a month on XXXX XXXX. I kept looking at my account online and seeing that roughly {$270.00} of the {$400.00} was going to the principal and roughly {$120.00} of the {$400.00} was going to interest. Not great ... but it was the first time that I was actually seeing my money going towards the principal balance!! I am still currently paying {$400.00} a month ... .I have paid close to {$13000.00} back since I borrowed this money ... and I currently owe roughly {$1600.00} MORE than what I originally borrowed!! This is financial XXXX. My once ~ {$22000.00} school loan has turned into a ~ {$35000.00} loan and is steadily climbing. Its clear to me that I have been steered into financial turmoil by the very organization that is set in place to help guide and mentor me though my school loans. I then received my XXXX form for XXXX. It states that I paid {$4500.00} of interest to Navient in the XXXX tax year. I paid Navient a total of {$4800.00} in payments in the tax year XXXX. If this form is correct, then that means that I paid ONLY {$270.00} towards the principal balance on my loan. However, my online account shows that almost that same amount ( XXXX ) is going towards the principal balance EVERY MONTH. So how can that be? When I questioned Navient I was told that " if that is what the tax form states then that is the correct amount of interest that you paid in the tax year XXXX. '' When I continued to question Navient, I was then told that the reason the amount was so high was " because it is actually the amount of interest that you have paid since XXXX. '' I replied with, " well that sure sounds like tax fraud to me. '' I ended the call immediately. I went to log on to my Navient account and when I typed " Navient '' into the search bar, it popped up. " Navient being sued '' I could n't believe it. I called and spoke with a wonderful lady at the Bureau of Consumer Financial Protection who informed my of what Navient was being accused of and literally, I am XXXX..HELP

Company response to consumer: Closed with explanation