Consumer complaint received 2024-03-09
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Received bad information about your loan
Company: MOHELA (CA)

I am a student loan borrower and my loans are currently being serviced by MOHELA. Below is summary of some recent issues I have experienced while interacting with MOHELA regarding my student loans and my MOHELA account. My attempts to have these issues resolved through direct communication with MOHELA and/or via complaints filed with the Federal Student Aid ( FSA ) Office of the US Department of Education have been unsuccessful. 

1. My request to be placed on forbearance after making XXXX payments toward PSLF, while my last PSLF form is being processed by MOHELA, was denied by them. This is contrary to information available on the FSA website, which indicates that borrowers HAVE THE OPTION TO REQUEST FORBEARANCE after making XXXX payments. 

Specifically : I have made XXXX payments toward PSLF, and they are reflected as 'eligible " payments on MOHELA XXXX website. My XXXX eligible payment was posted on my due date, XX/XX/XXXX. My employer completed my employment certification form on XX/XX/XXXX, and it was received by MOHELA on XX/XX/XXXX. As of this morning, the form shows processed, yet, no updates have been made to my account ( i.e., my employment dates and number of qualifying payments have NOT been updated ), and at this point it is unclear if the form was marked as processed in error, or if my account is yet to be updated. The processing time of PSLF forms per MOHELAs website is up to 60 days. 

I called MOHELA on XX/XX/XXXX to request that my account be placed in forbearance while they are processing my PSLF form, and spoke to a representative by the name of XXXX. She denied my request stating MOHELA does not grant forbearances until their system confirms that the payments are qualifying ( i.e., they are made in accordance with all PLSF program rules ), which requires that the processing of my PSLF form is completed and my account is updated. I requested to speak to a supervisor or someone else in the office, but that request was denied as well because XXXX believed she had already given me all the information anyone in the office could give me. Yet, during the call we touched on various issues pertaining to my account and the PSLF program, and none of the information she provided was correct. She did place me on hold for some time, reportedly to check with a supervisor, but came back on the line XXXX min later to notify me that her supervisor, XXXX XXXX XXXX had refused to accept my call. Additionally, XXXX was not able to provide me with a call reference number for our call as it reportedly generates AFTER the call is completed. She suggested I call back to ask for the reference number, even though she was well aware of the exceptionally long wait times to speak to a representative at MOHELA ( i.e., it took me XXXX tries, a XXXX min attempt, followed by a XXXX min attempt, and I finally got connected after I waited on hold for nearly an hour ). Needless to say, as a full-time employee in the public sector is it extremely challenging to find enough time during business hours Monday to Friday to be on hold waiting to be connected with a MOHELA representative or to spend unnecessarily long time on the phone with representatives who provide erroneous information. Lastly, XXXX also refused to send me the call reference number after our call via MOHELA 's messaging system, as they do not send personal messages. She did say that all calls are being recorded, so hopefully my call with her can be tracked down if need be. 

The denial of my request to place my account in forbearance while my PSLF forms is being processed by MOHELA is contrary to what the US Department of Education/FSA indicate on the FSA website . Here is an excerpt of the statement from the FSA website : Q : When I submit my form for loan forgiveness after making the required XXXX qualifying payments, how long will it take to process my form and forgive my remaining loan balance? 
You should continue to make payments while your PSLF form is being processed, BUT YOU HAVE THE OPTION TO REQUEST A FORBEARANCE IF YOU BELIEVE ( or our system determines ) YOU HAVE ALREADY MADE XXXX PAYMENTS. 

The denial is further unreasonable and problematic given MOHELAs processing time of PSLF forms has doubled over the last couple of months, and has gone from up to XXXX days to up to XXXX days. Being the borrower, I should not be burdened financially by being forced to make extra payments, because MOHELA is unable to process applications in a timely fashion. In fact, based on past experience, these time frames are gross underestimates of how long it truly takes MOHELA to process PSLF applications. My last application from XX/XX/XXXX took over XXXX months to be processed, even though at the time MOHELAs website reflected that it would take up to 30 days. Additionally, forms are often incorrectly marked as processed, and yet, no updates are made to the account, which as of this morning, appears to be the case with my current PSLF form. Forms are also often marked as duplicate, even though they contain new/updated information. Prior to the payment restart in XX/XX/XXXX, MOHELA representatives on the phone were able to expedite the corrections of such errors, but since XX/XX/XXXX, they are no longer willing to do so. In turn, in order to have a mistake like that corrected, a borrower is placed at the end of line, as though they just submitted their form for processing, even though they had been waiting a while when the error in processing occurred ; as a result, the waiting period to have the form processed correctly is unnecessarily prolonged/restarted. 

-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 2. The month of XX/XX/XXXX is incorrectly listed as ineligible toward PSLF : The month of XX/XX/XXXX is listed as ineligible toward PSLF in my MOHELA account, which is incorrect. Specifically, there was Administrative Forbearance on my account between XX/XX/XXXX and XX/XX/XXXX while my application to change my IDR plan was being processed. Per the new XXXX Department of Education rules, starting XX/XX/XXXX, periods spent in Administrative or Mandatory Administrative Forbearance count toward PSLF, and therefore, the month of XX/XX/XXXX, should be corrected to reflect eligible in my MOHELA account. 
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- 3. Late billing notices for XX/XX/XXXX : I am one of the XXXX XXXX student loan borrowers, who received a late billing notice for the month of XX/XX/XXXX. Specifically, my billing notice was posted in my account on XX/XX/XXXX, only XXXX days prior to my payment due date at the time ( i.e., the XXXX of each month ), even though the notice itself was dated days prior to being posted ( i.e., XX/XX/XXXX ). After discovering XXXX failure to meet its basic obligation to send timely billing notices to borrowers, XXXX Department of Education instructed MOHELA to make adjusts to ALL affected borrowers accounts by : 1 ) placing them in forbearance until the issue was correct, 2 ) resetting the accrued interest to XXXX, and 3 ) crediting the affected accounts toward PSLF for each month the accounts remained in forbearance. Despite the directive from the US Department of Education, no adjustments were ever made to my account. Ive spoken to MOHELA multiple times about this issue, and after much push back from MOHELA ( indicating my account was not affected ), in XXXX I was promised that the adjustments to my account would be implemented within a few weeks. Yet, as of today, XX/XX/XXXX, no changes have been made. The interest that accrued in XXXX was never reset to XXXX, and the month of XXXX, as indicated above, continues to show as ineligible toward XXXX. As previously indicated, my account was in administrative forbearance, but for a different reason ( i.e., while my application to change my IDR plan was being processed ). I did file a complaint with FSA regarding this very issue, and it was closed XXXX times by MOHELA without any communication with me as to why it was closed and what the findings of their investigation showed. Please note that complaints filed with FSA get forwarded to the loan servicer ( i.e., MOHELA in my case ) for processing and resolution, which is why it was MOHELA, and not FSA, closing the complaints.

While the first course of action directed by the US Department of Education ( i.e., placing the account in forbearance ) is irrelevant in my case, since the account was already in forbearance for a different reason, the other XXXX directives ( i.e., 2. Resetting the accrued interest, and 3. Crediting XXXX toward PSLF ) still need to be addressed. 

Thank you for your time and consideration. I will be happy to provide any additional information that might be required.