Consumer complaint received 2019-05-22
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Received bad information about your loan
Company: AES/PHEAA (UT)

Details of Complaint : INCORRECT INFORMATION ABOUT ELIGIBILITY AND PSLF PROGRAM In XX/XX/XXXX I began repaying my student loans accrued from my XXXX and XXXX degrees through Fed Loan, the student loan servicer for Federal Student Aid in the U.S. Department of Education. 

( I have a list of payments made through Fed Loan ) In XX/XX/XXXX I was accepted into the Fed Loan Public Service Loan Forgiveness ( PSLF ) program. I was notified that I had 40 Qualifying Payments towards my 120 payments required for forgiveness. 

( Available documents : Application for Public Service Loan Forgiveness program, Information Regarding Your Eligibility for Public Service Loan Forgiveness ) In XX/XX/XXXX I contacted Fed Loan to get clarification on my payment amount. During this conversation ( Fed Loan has verified this conversation was recorded ) I was told by the Fed Loan representative that three of my student loans were unsubsidized and not eligible for PSLF. The representative told me to consolidate the loans and pick a new payment plan. 

The information was not clear to me that I was to only consolidate the three loans and begin with two separate payments for each consolidation ( the first consolidation I completed when I began my payments in XX/XX/XXXX, and the new consolidation of the three other loans ). I assumed this meant to consolidate all of my loans together as I had done when I began my payments with Fed Loan. 

( Available : Consolidation documents ) On XX/XX/XXXX I received a letter in the mail from Fed Loan that said, " We are writing to inform you that if you consolidate your loans as requested, you will be disqualified from your payments made towards your 120 payments for the loan forgiveness program. '' There was no note on the letter that said a timeline for when I had to respond. 

( Available document : Letter from Fed Loan dated XX/XX/XXXX ) On XX/XX/XXXX ( a Saturday ) a different agency within Fed Loan   sent me an e-letter to my Fed Loan inbox with the same subject line as the letter sent to my home. I did not read this letter, as I assumed it was the same information they sent me physically in the mail. However, this letter had additional information, a note saying " To cancel your consolidation application, visit MyFedLoan.org and sign into Account Access, your online account management tool. You have 10 business days from the date of this letter to cancel your application. After the consolidation process is complete, we are not able to " unconsolidate '' your new Direct Consolidation Loan. '' ( Available document : E-Letter from Fed Loan ) On XX/XX/XXXX I called Fed Loan to cancel my consolidation per the letter I received in the mail. I asked two representatives ( Fed Loan has verified these conversations are recorded ) if I had a consolidation pending. I told them repeatedly I wanted to make sure the consolidation didnt go through because I didnt want to lose the payments I had made towards my PSLF. Both representatives assured me there was no consolidation and I had nothing to worry about. 

The representatives then clarified the correct consolidation needed to qualify my unsubsidized loans for PSLF. Their instructions for me at that time was to first go request a new payment plan ( this would be the second time since XX/XX/XXXX I had done so from their instructions during this phone call and during the XX/XX/XXXX conversation ). They said once I get my new payment amount look into consolidating just the three unsubsidized loans. 

So, on XX/XX/XXXX I did as the representatives had instructed. I resubmitted a new payment plan. 

I was under the assumption that doing so, and per their instructions, the previous incorrect consolidation had been cancelled and I was not going to be disqualified from the PSLF program. 

On XX/XX/XXXX I got a letter in my Fed Loan e-inbox that read " Congratulations, your loans have been consolidated '' and then an additional letter that explained my new payment plan. 

On the morning of XX/XX/XXXX after opening these e-letters, I immediately called Fed Loan and asked why I had received a letter about my consolidation when I had called previously and was told there was not one pending and had followed their instructions to properly qualify my unsubsidized loans for PSLF program. 

The first supervisor from Fed Loan understood my confusion and the error and requested an Override Appeal within Fed Loan under the grounds that the letter was sent to me so quickly. 

Thirty minutes after he submitted this appeal, I received a call from Fed Loan informing me the request was denied. 

The second supervisor I spoke to on this day reviewed all of my recorded phone calls, all of the communication I had received and told me, " Because we sent you that e-letter in your Fed Loan inbox, there is nothing we could do. The consolidation has gone through and you are back to 0 of 120 payments towards loan forgiveness ( paraphrased ). '' I asked this supervisor after she had listened to my recordings of conversations with other representatives if when I called on XX/XX/XXXX and was told " there was no consolidation processing '' if they were giving me misinformation. The supervisor replied, " Yes, that was misinformation and I apologize about that. '' I also asked the supervisor why they would send me two letters ( digital and print ), one day apart that said different things ( Attachment E & F ) The supervisor told me because they came from " different areas '' of Fed Loan. 

As a consumer I feel as though I was misled through this process by Fed Loan,  they took advantage of me as a consumer by sending information inconsistently, as their internal departments are not coordinating the information they are sending to lenders, and giving unclear and misleading information during all of my conversations on the phone. 

As of today, I am at only 6 of 120 payments towards my public service loan forgiveness. Had I not been misled to incorrectly consolidate I would be at 55 of 120 payments. On average my payments have been {$500.00} per month. This means I have lost approximately {$26000.00} payments I will need to make up to get my loans forgiven.