Consumer complaint received 2024-06-26
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: MOHELA (VA)

I sent the following letter of complaint to Mohela, and spoke with four representatives over the last two days. The representatives refuse to correct the problem. This is the third time that the same thing happened to me. They are putting loan borrowers on in-school deferment and each time assessing interest for being on deferment. My loan has increased rather than decreased, despite the fact that I have been saving up money to pay extra out of the principle. {$14000.00} of interest is a lot of money for student burrowers to pay for a loan servicer 's mistake. But, the loan servicer is call-deflecting. Mohela has been already sued by multiple borrowers, but continues to use the same tactic on student loan borrowers. Most of them are too young to fight against what they are doing. They are being ripped off XXXX XXXX XXXX of dollars without recourse -- despite the excellent law that Biden administration came up with to help them pay off loans. 

= = = = = XX/XX/year> Re : Keep My Account the Same ; Remove ALL Interests Assessed by Mohela by Changing My Status to In-School Deferment in XXXX XXXX  ; Keep Automatic Payment for Public Service Loan Forgiveness Account To Whom it may concern at Mohela, I was on an Automatic Monthly Payment Plan to pay off my student loan on XX/XX/year>, before Mohela transitioned its electronic XXXX in XXXX. I owed {$130000.00} in total loan balance as of XX/XX/year>. On XX/XX/XXXX, someone placed me on deferment status, despite my explicit instructions in a letter not to do so sent to your company. As a result, I was assessed {$14000.00} in interest due to the status change from in-payment to in-school deferment in XX/XX/year>. As of XX/XX/year>, I owed {$130000.00}, and your company assessed {$14000.00} in interest on XX/XX/year>, due to randomly changing my status to in-school deferment. I had explicitly sent a letter to your company on XX/XX/year>, stating that I am not supposed to be placed on an in-school deferment. I had to spend several hours working with your representatives to fix this problem in XXXX and remove the {$14000.00} in interest that your company assessed on XX/XX/year>. 

As on XX/XX/XXXX and XX/XX/year>, I was on automatic monthly payment plan. Your company was supposed to withdraw {$330.00} per month for the student loan and these payments were supposed to count for my Public Service Loan Forgiveness XXXX payments. 

Yesterday, XX/XX/year>, I discovered that your company stopped drawing my automatic monthly payment after XX/XX/XXXX during the transition of your electronic platform. I found out that your company again lost my record, put me back on in-school deferment status in XXXX ( middle of previous semester ), and assessed approximately {$14000.00} in interest in XXXX on my loan account for randomly changing my status. I did not request my status to be changed! Additionally, it is the middle of XXXX, and I had already spoken with your representatives in XX/XX/year> not to do this. There was not even a change in semester! 

I sent your company my last letter on XX/XX/year>, explaining that I do not want deferment ( Exhibit D ). As part of my work, I am required to take some training courses at the XXXX XXXX XXXX XXXX, and I am continuing to work as a resident at the same time. I have not changed employment, nor has there been any new semester or coursework that started between XX/XX/scrub> XXXX XXXX XXXX XXXX Yet, your company changed my status to in-deferment and again assessed approximately {$14000.00} in interest, and added the interest to my loan. 

I called your representative yesterday ( XX/XX/year> ). The first representative was a trainee, and I kindly explained the situation to her. She did not know what she was doing and transferred my call to her supervisor, who was rude. The supervisor stated that she needed my phone number for debt collection and insisted that she had removed all interest assessed by changing my status to in-deferment. She also claimed not to see any paperwork I had submitted previously, requesting that I not be placed on in-school deferment. I have sent your company multiple communications, including a letter on XX/XX/year> ( Exhibit D ). Your company fixed everything in XX/XX/year>. However, in XXXX, your company changed my status again and assessed ~ {$14000.00} in interest. Now my loan balance is {$140000.00}. My loan balance continues to increase because your company keeps placing me on in-deferment and assessing ~ {$14000.00} each time, making it nearly impossible to pay off the loan. It does not make any sense to put me on loan deferment status in the middle of XX/XX/year> after I explicitly requested not to be put on deferment in XX/XX/year>. Please remove the approximately {$14000.00} in interest that Mohela assessed on my loan between XX/XX/XXXX and XX/XX/XXXX. Students should not be forced to pay {$14000.00} more in loans every time Mohela loses their paperwork. 

Your company 's mistake in not withdrawing money from my account in XXXX and XXXX of XXXX  has cost me two pay periods of Public Service Loan Forgiveness. Please rectify this problem. Two payments I made manually yesterday are pending processing. If my loan is not forgiven because I am two months short of forgiveness due to your company 's failure to process my payments for XX/XX/XXXX and XX/XX/year>, I will personally hold your company responsible for the remaining loan amount. Your company has been hereby notified. 

Thank you very much. 

Best regards, XXXX XXXX XXXX XXXX Exhibit A : My balance in XX/XX/year> Exhibit B : Your company made same mistake in XX/XX/year> Exhibit C : My balance increased again in XXXX, instead of decreasing. Your company made the same mistake in XXXX that you made in XXXX. My balance is increasing despite I trying to pay it off, because your company keeps putting me on deferment status and adding interests incorrectly. Please fix this! 




Exhibit D : I have sent several letters to explain that I do not want deferment. This letter was sent to your company on XX/XX/year>.