Consumer complaint received 2024-03-14
Product: Student loan — Federal student loan servicing
Issue: Struggling to repay your loan — Problem with your payment plan
Company: MOHELA (RI)

XX/XX/XXXX I signed up for Income Driven Repayment with federal student aid in anticipation of loans restarting. My expected calculated monthly payment was around {$80.00}. 
XX/XX/XXXX {$80.00} was withdrawn from Dept of Education. 
XX/XX/XXXX I noted a {$2400.00} unexpected withdrawal from Dept of Education. This amount is much greater than my whole biweekly paycheck, which sent my account into overdraft. 
I called Mohela XX/XX/XXXX and spoke to a woman whose name I didnt write down. She helped me by requesting a refund of {$2400.00}. She helped me by applying to another IDR plan which I was under the impression I was already on ( see XX/XX/XXXX ).. 
My new monthly payment would be around {$18.00}. She also put my account into administrative forbearance while awaiting enrollment in the new IDR plan. This forbearance was approved on XX/XX/XXXX with a total time from XX/XX/XXXX - XX/XX/XXXX. I was approved for the IDR plan on XX/XX/XXXX, at which point my loans came out of forbearance. 
I awaited Mohelas return of the money I literally did not have. I put expenses on my credit card and took loans from family. This was exceptionally difficult as my XXXX was broken into at my home on XX/XX/XXXX and I incurred approximately {$1200.00} in additional costs related to this. By XXXX, as my credit card payments had significantly increased and I had not been able to pay my family back, I wrote to Mohela on XX/XX/XXXX. I have excluded their included state specific text which appear at the bottom of each Mohela message. 

Deferment and Forbearance Attachments ( click to open ) : Received XXXX XXXX XXXX Body : Your Question : Good morning, I wanted to follow up on the status of my refund request for the withdrawal on/around XX/XX/XXXX of appx XXXX. I could not afford this payment, was not expecting it, and it overdrafted my account. I soon need to pay people back for keeping me afloat. Thank you, XXXX XXXX MOHELA 's Response : Thank you for contacting MOHELA, We apologize for any inconvenience experienced with your Auto Debit payment drafting after you have submitted your payment. Our records indicate that a request was submitted on XX/XX/XXXX to refund the payments you made on the effective date of XX/XX/XXXX in the amount of {$2400.00}. Please allow up to 60 days for this request to be processed. All refunds are issued by the U.S. Treasury. MOHELA is not able to verify a maximum timeframe on behalf of the U.S. Treasurys processing. 
Thank you, MOHELA Phone XXXX Fax XXXX TDD Dial XXXX XXXX M, XXXX T-W, and XXXX TR-F. XXXX. XXXX XXXX XXXX, XXXX, MO XXXX. 
This message, from a debt collector, is an attempt to collect a debt and any information obtained will be used for that purpose. '' I called Mohela on XX/XX/XXXX and spoke with a man. He informed me that it looked like my refund had been approved and completed, but I assured him no money had come back into my account. He transferred me to another department, but after > 20 minutes on hold I unfortunately had to give up on the call. 

I called Mohela again on XX/XX/XXXX. I spoke to XXXX. She informed me that my request for refund had been DENIED on or around XX/XX/XXXX. I informed her the man I spoke to had tried to transfer me to another department, and I asked to speak to another department and she declined to transfer me. I asked about the appeals process and she stated that I could try to submit another refund request. I asked her the reason for the denial. She stated because it was a legitimate payment and auto-debit withdrawal. I asked why I was not notified. She stated because I would have had to request notification of the decision. I requested a notification during this phone call. 

Please see attached PDF document which includes screenshots. 

I would have contacted my bank if I knew that this auto-debit refund had been denied. I could have taken earlier action to prevent this payment I could not afford from going through. Mohela 's used obfuscation and unfair actions to take money that I did not actually have.