Consumer complaint received 2024-07-10
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Received bad information about your loan
Company: Maximus Federal Services, Inc. (NJ)

My student loan servicer, Aidvantage, has increased my total payment amount by {$2000.00}, which is unlawful in accordance with the government 's XXXX plan ( which I am enrolled in ). Aidvantage refuses to correct the amount. My monthly payments are {$0.00}, as I currently have NO INCOME. Under the XXXX plan, any monthly interest amount that exceeds the monthly payment ( {$0.00} ) is automatically forgiven. The Department of Education confirms that it is the student loan servicer 's responsibility to ensure that the balances reflect the interest forgiven under the XXXX XXXX, in short, I should not see any interest accruing. If Aidvantage is refusing to adjust the interest currently accruing, it is violating the terms of the government-set XXXX plan. 
I quote directly from the governments website ( studentaid.gov ) : XXXX of the greatest benefits for borrowers on the XXXX XXXX is the government interest subsidy. On the XXXX XXXX, if you pay what you owe each month, your loans wont grow due to unpaid interest. This is because any accrued interest not covered by your monthly payment wont be added to your principal balance. 
Under other XXXX plans, you XXXX see your loan balance grow due to unpaid interest. With the XXXX XXXX, any remaining accrued interest will be covered by the government, so your principal balance wont increase ( XXXX, accessed XXXX XX/XX/XXXX ). 

Aidvantage is not honoring the fact that I am enrolled in the XXXX plan. To my horror, I also just saw that Aidvantage has placed my account in FORBEARANCE on XX/XX/XXXX after I had applied for being enrolled in the XXXX plan, not for forbearance. Forbearances can be harmful for borrowers because interest accrues on their loans during the period of paused payments. XXXX accrued interest can then be capitalized added back on to the loan principal balance having a compounding effect and leading to runaway balance growth. Forbearances also do not count towards loan forgiveness terms, such as the XXXX repayment term for XXXX XXXX XXXX ( XXXX ) or the 10 years of public service employment required for borrowers on track for the XXXX program. Aidvantage randomly placed my account in forbearance when what I asked for, very clearly and specifically -- as can be gleaned from my studentaid.gov application -- was to be placed in the XXXX plan. This is not only harmful to me, but it is abusive. It is decidedly NOT what I had asked for and enrolled in on XXXX. Furthermore, to simply place me in forbearance after I enrolled in the XXXX plan is deceptive and misleading conduct and an abuse of power on behalf of my student servicer, Aidvantage. 

Moreover, Aidvantage purposed stalled my XXXX plan application which was submitted on XXXX on XX/XX/XXXX. They requested tax forms which I had shared with them on XXXX 's application ( hence an unnecessary delay tactic ) and they ignored my XXXX application for months. They finally approved in on XX/XX/XXXX. And now I see that they did not do so without placing me in forbearance first, which is likely the cause for the accrual of interest. They are not acting according to the lawful terms of the government 's XXXX plan, and have mislead me or stalled me repeatedly, only to unlawfully accrue huge interest payments on my loans.