Consumer complaint received 2019-11-14
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: AES/PHEAA (MN)

In XXXX of XXXX I submitted the necessary documentation to remain in an income based repayment plan for my student loans and received documented verification that my application was approved through XXXX. At the same time I submitted public student loan forgiveness payment verification paperwork to certify that my payments counted toward public student loan forgiveness. In XX/XX/XXXX I received notification from FedLoan that they would be taking over my loan services from XXXX going forward as apart of the public student loan forgiveness program and that my direct deposits and monthly payments would continue as with my previous loan service provider. Their communication also stated that my current income based repayment plan did not qualify for public student loan forgiveness and that I would need to change plans in order for payments to count toward the program. This communication did not say if I did not recertify it would change my current repayment amounts effective immediately nor did it include a date by which the recertification needed to be completed in order to avoid an increase in payments. On XX/XX/XXXX I received a letter from FedLoan dated XX/XX/XXXX stating that because they had not received documentation of my income that I would be automatically placed on the 10 year repayment plan and my next bill would be {$2300.00} on XX/XX/XXXX. I immediately resubmitted an application for income based repayment by fax, mail and the online FedLoan account. I reached out by phone and email to FedLoan to try to expedite my application request, an effort taking >4 hours, without response. XX/XX/XXXX I received electronic communication that my application would be processed by XX/XX/XXXX but I would still be required to pay {$2300.00} on XX/XX/XXXX until the income based repayment application was approved. I again contacted FedLoan to try to speak to someone to expedite my application as I am unable to make the {$2300.00} payment XX/XX/XXXX after waiting for hours I was finally able to speak to someone who expedited my request and placed a hold on the XX/XX/XXXX bill. 

I am complaining because 1 ) my recertification for income based repayment had already been processed and approved for this year ; 2 ) FedLoan gave me 2 weeks notice of the increase in my monthly loan payment and need to reapply for income based repayment ; 3 ) on the income based recertification/application it specifically states that if the repayment plan changes the loan service provider should default payments to the plan with the lowest monthly amount until reapplication has been completed and FedLoan placed me on the 10 year repayment plan by default, the greatest monthly repayment plan ; 3 ) I spent >8 hours trying to contact FedLoans and submit documentation they asked for by various means ( as several different sets of instruction were provided ) with limited success. This experience caused me great amounts of stress, took away from my productivity at work and, most importantly, was entirely avoidable if the loan servicer had provided a transparent process including steps needed to successfully transfer my loans, taken the time to transfer my already approved income based repayment plan, or given me more notice to re-apply prior to defaulting to the greatest monthly repayment plan.