Consumer complaint received 2024-01-27
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: MOHELA (MN)

All of my federal student loans are serviced by MOHELA. They were all put on the REPAYE IDR plan back in XXXX. 

On XX/XX/XXXX, I received a letter from MOHELA stating, " Your eligible loans have been placed on the Saving on a Valuable Education ( SAVE ) IDR Repayment Plan. If you were previously on the Revised Pay As You Earn ( REPAYE ) Income-Driven Repayment ( IDR ) Plan, it has been replaced by the SAVE Plan. '' The letter listed my new monthly payment amount as {$350.00}, and it said the scheduled begin date for XX/XX/XXXX. Given that all of my loans had been on the REPAYE IDR plan, I understood this to mean that all of my loans had been transferred to SAVE. 

However, I did not have a XXXX payment, as my account was placed in an administrative forbearance by MOHELA per federal instruction because they hadn't properly billed me for my earlier XXXX payment. At the end of XXXX, before my upcoming auto-payment, I checked the MOHELA website to make sure everything was set for my payment, and I noticed it said that my payment amount was {$1100.00}. 

I immediately called MOHELA to find out what had happened. Apparently, not all of the loans had properly been transitioned from REPAYE to SAVE, and the loans that hadn't been transitioned and dropped off an IDR plan altogether. I requested MOHELA to immediately fix this and put any loans not on SAVE on SAVE. I also requested an administrative forbearance since this wouldn't be fixed before my upcoming payment due date. The agent said she submitted for this to be done and she also requested the forbearance. 

On XX/XX/XXXX I received a letter from MOHELA stating that they were " unable to grant your request '' for an IDR repayment plan because my " request was incomplete '' and I hadn't submitted the IDR Request Form ( multiple page form ). When I had talked to the agent, she had said this form wasn't necessary because the transition should have been automatic from REPAYE to SAVE and no forms had been needed when MOHELA made that transition. 

I again had to call MOHELA and I explained the situation. The agent said she didn't see why I would have to submit an IDR application as the loans were originally IDR approved and had been dropped off by MOHELA on accident. However, upon talked to her supervisor, I ended up having to work over the phone with her to submit a new IDR request for those loans - despite the fact that this wasn't my fault and should have done automatically by MOHELA in the first place. I am still waiting on that IDR to hopefully go through. 

In addition to the issues with the REPAYE/SAVE transition, I was also improperly billed in advance of my XXXX XXXX payment. On XX/XX/XXXX, I received an email from MOHELA advising that my account was placed into an administrative forbearance through XXXX XXXX ( a little late maybe seeing as it was now XXXX ). The email letter stated that " the months of XXXX through XX/XX/XXXX will count toward IDR forgiveness and Public Service Loan Forgiveness. '' Yet when I went and checked my PSLF tracker today in MOHELA, the XXXX XXXX loans are all listed as ineligible. 

MOHELA has no business managing anybody 's money let alone student loans for millions. They're completely incompetent and in no other business field would this level of poor service stand. They should be seriously fined and punished by the government for their irresponsibility and mismanagement.