Consumer complaint received 2024-09-01
Product: Student loan — Federal student loan servicing
Issue: Struggling to repay your loan — Problem with forgiveness, cancellation, or discharge
Company: EdFinancial Services (NY)

Dear Ombudsman, I am writing to address a deeply concerning issue regarding my federal student loans, which has caused significant emotional and mental distress. Approximately {$63000.00} spread across four federal loans were forgiven under the Public Service Loan Forgiveness ( PSLF ) program. I earned this forgiveness through a decade of dedicated service as a medical technologist at an understaffed, low-income hospital, where I fulfilled all program requirements by working tirelessly to support my community. 

On XX/XX/XXXX, I received a letter from XXXX confirming this forgiveness, which stated : Congratulations! On XXXX XXXX, XXXX, the Department of Education announced a change to the Public Service Loan Forgiveness ( PSLF ) program rules for a limited time that allows you to get credit for payments you've made on loans that wouldn't normally qualify for PSLF. As a result of this limited PSLF waiver ( StudentAid.govXXXX ), we conducted another review of your Public Service Loan Forgiveness ( PSLF ) & Temporary Expanded PSLF ( TEPSLF ) Certification & Application ( PSLF Form ) and payment history. We have determined that you have successfully made the required 120 monthly payments in order to have all or a portion of your loans listed below forgiven. 

This is a table that provides you with detailed information such as your loan sequence, loan program, Amount Forgiven, and Outstanding Balance for each applicable loan. 

Loans Details : Loan Sequence Loan Program Disbursement Date Amount Forgiven ( Principal and Interest ) Outstanding Balance XXXXXXXX XXXX XXXX XXXX XXXX {$0.00} XXXX XXXX XXXX XXXX XXXX  {$0.00} You have satisfied your obligation and no additional payments are required on these loans. 

Will I have to pay income tax on the forgiveness amount? 
No. According to the Internal Revenue Service ( IRS ), student loan amounts forgiven under PSLF or TEPSLF are not considered income for tax purposes. Please contact the IRS or a tax advisor for more information. 

Despite this clear and unequivocal statement from XXXX, I later received a bill from XXXX, claiming that these loans were never forgiven. To make matters worse, the loans were subsequently transferred to EdFinancial Services, where they continue to appear as outstanding debts. 

This situation has exacerbated my severe XXXX and XXXX, significantly affecting my ability to function both personally and professionally as a XXXX XXXX XXXX. The ongoing uncertainty and financial strain have become unbearable, leading to my prescription of XXXX of XXXX daily to manage my symptoms. 

The actions of XXXX, XXXX, and EdFinancial Services in this matter appear to be both unfair and deceptive, amounting to abusive practices that have caused substantial actual losses and damages. It is deeply troubling that after my loans were rightfully forgiven, I am still being pursued for repayment. This situation also raises concerns of potential discrimination, as my rights as a borrower are seemingly being disregarded without justification. 

I am urgently requesting your intervention to correct this egregious error. I ask that you ensure my loans are accurately reflected as forgiven across all servicing records and that all collection efforts cease immediately. Additionally, I seek appropriate compensation for the emotional distress and financial harm that this situation has inflicted upon me. 

I trust that the Department of Education will take swift and decisive action to resolve this issue and prevent any similar occurrences in the future. I appreciate your attention to this critical matter and look forward to a prompt resolution.