Consumer complaint received 2018-04-11
Product: Student loan — Private student loan
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: AES/PHEAA (NY)

In XX/XX/XXXX at XXXX  years of age I received a co-signed loan disbursement of {$28000.00} for my education expenses from a private student loan servicing company based in Pennsylvania through American Education Services ALPLN Loan Program. I, like many at that age, was not fully aware of what I was agreeing to once it came to the time of repayment and did not understand that private student loans would not have any of the basic or common sense regulations that help borrowers repay these loans. I think this company is one of the worst of the worst, and they structure these loans to inflate the principal balance and make borrowers pay substantially more in interest versus the amount that is allocated to pay the principal balance with monthly repayments. To date XX/XX/XXXX I have repaid a total amount of {$18000.00}, {$12000.00} of which was paid interest, {$6000.00} of the remaining amount was paid to the principal balance, with {$60.00} also in fees. To this day XX/XX/XXXX, the principal balance I owe is {$31000.00}, ( that is criminal! ) In recent days, I noticed some suspicious activity and messaging on my account that was notifying me of forbearances I did not initiate or authorize and I was told these were put in place to update the account with strange information relating to in school deferments that go years back. In XXXX of XXXX, I was notified that the repayment terms of my loan have changed, which I did not agree to or initiate, that raised my monthly repayments by $ XXXX {$40.00} per month. Also, I had a phone call with American Education Services yesterday XX/XX/XXXX as I had noticed that my monthly payments had increased one month into my new repayment terms, to a higher rate than of the rate. I asked the customer service representative why is my XX/XX/XXXX rate higher, she replied that my monthly repayments will rise in XX/XX/XXXX and XX/XX/XXXX of every year throughout the remaining payment terms of my loan which is over 130 months to date, and that she could not forecast what my repayment amounts would be as my loan does not have a fixed interest rate, and it would be impossible for them to calculate this information. But she did allude that my payments could approximately rise to as much as {$400.00} or {$500.00} a month over the course of the years ahead in my repayment as " I am now paying more of my principal '' according to the new terms. The last I checked, this is not he wild west, how in XX/XX/XXXX, in a nation that prides itself on its dedication to upholding the rule of law and protecting the vulnerable, lets these companies and run freely wild with profiting off the backs of lower income earners like myself, who earn only {$30000.00} a year? How can they be so bold to tell me that I have no options but to roll with the repayment terms of their loan that has seemingly no limit as to what my monthly payments will be for the next 130+ months as the interest rate is not fixed. What makes my loan repayment amount increase consecutively every XX/XX/XXXX and XX/XX/XXXX, apparently nothing related to the interest rate? I implore the CFPB to investigate American Education Services for predatory student lending and bring confidence back to the thousands of students like myself who are trying their hardest to pay their loans back, but are being weighed down by a predatory lender who does not properly communicate the repayment terms of their loan to borrowers in a clear and concise fashion, and a predatory lender who makes complicated account changes that do not make sense to the borrower. XXXX XXXX got sent to prison for his ponzi scheme, how can American Education Services which is operated by the Pennsylvania Higher Education Assistance Agency keep getting away with theirs?!?! Why were they even lending in New York?!?! I thank-you for your time, and do appreciate your attention to my concerns which are very upsetting to me.