Consumer complaint received 2022-01-31
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Problem with customer service
Company: AES/PHEAA (NY)

I am a borrower who should benefit from the Biden Administration 's XXXX waiver. I have been employed for most of the past sixteen years by the United States Courts. I have made payments more than 120 months of payments on XXXX  loans and XXXX XXXX loans during the months I have been employed by the courts. I submitted an application to Fed Loan Servicing last fall. I heard from them after the Biden Administration announced the waiver program in XXXX, informing me that I did not qualify because I had not made XXXX payments on a direct loan in a qualifying repayment program. I called Fed Loan Servicing to find out why they had sent me this letter after the XXXX announced that the rules had changed. I also called because they had failed adequately to process the dates of my employment. I have three periods of employment in the federal courts. The first was for three years. I then had a two-month pause, and worked for another two years. I then left for three years, and have spent the past eight years as a federal employee. Their calculations ignored the second, two-year, period. Fed Loan 's representative acknowledged their error on periods of employment, but suggested I submit another application, as well as certification that I continued to be employed by the federal courts. The representative with whom I spoke claimed that Fed Loan had no idea about how to administer the program because the government provided no guidance, but could not explain why the company sent out a denial when they knew that the terms had changed. Instead, Fed Loan said simply to wait until they received guidance and that they would process my application when new guidance appeared. I filed a new application to ensure that the company had my most current information and in an attempt to see if they could process this correctly. 
Fed Loan sent me a letter on XX/XX/XXXX stating that the company had received my application for XXXX loan forgiveness. Fed Loan said they would process the application. I have heard nothing from them since on that issue. I continue to wait for an evaluation, and I am frustrated. I am especially frustrated because the Biden Adminstration keeps announcing how many people have been helped by the waiver program, and my US Dept. of Education Account does not even acknowledge that I have applied for XXXX. I fear that my application has fallen through the cracks, and that I am going to have to wait for months to receive the forgiveness to which I am currently entitled. Such forgiveness will be costly for me, even if I receive it. I have continued to pay on my loan as I wait for forgiveness, as I remain skeptical about the possibility. I can read the law, but I worry about Fed Loan 's ability to do so. With that in mind, I can not ignore the possibility of paying directly on the principal and lowering my interest cost. Of course, if Fed Loan doesn't bother to process my loan forgiveness by XX/XX/XXXX, I will be required to pay in any case, and pay interest on the remaining balance as well. I should have access already to the money I'm paying on my student loans. Fed Loan 's dithering incompetence is preventing that. 
I filed a complaint with the Education Department after I spoke to Fed Loan in XXXX. They responded on XX/XX/XXXX ( that letter is not part of my on-line account at Fed Loan XXXX. That too is a dithering response. XXXX replied within a week to a complaint filed via the Education Department. That response explained that they had received my applications for XXXX and stated " [ w ] e 're currently reviewing to make sure your PSLF Form is complete and to confirm that you have been employed full-time by a public service organization or have served in a full-time XXXX or XXXX XXXX position. XXXX Once they make that determination and find me eligible, Fed Loan claims, the Education Department will transfer my loan to Fed Loan and they will determine how many payments I have made. After a paragraph explaining this process, Fed Loan appears to repeat itself, explaining that " [ o ] nce you are successfully enrolled in the XXXX Program, your student loan account will automatically be opted into the waiver. The Department will work with FedLoan Servicing to review your account, update any payment counts, correct any errors, and consider/reconsider any forgiveness that may result. '' Fed Loan will then seek any additional information. They end the letter by stating " [ b ] ecause the Department will ultimately determine how the waiver will impact your specific outcome, please refer to '' the Department 's website for more information. The back of the letter describes the eligibility requirements for XXXX. That statement comes from the pre-waiver era and is misleading, describing how only payments made on particular repayment plans and particular types of loans qualify for XXXX or TEPSLF. There is a note at the bottom : " The information contained in this communication is based ont eh current XXXX program regulations. FedLoan Servicing will implement all XXXX Limited Waiver Program ( LWP ) regulation changes as directed by the U.S. Department of Education ( ED ) when detailed instructions are provided specific to your account. '' Fed Loan 's conduct in this instant has been infuriating and discouraging. Though compensated to process applications, from the beginning of the waiver program they have shifted responsibility to the Department of Education. There may be some justification for that, but there can be no justification for continuing to send out information about loans that ignores the waiver program and discourages people who may qualify from applying for forgiveness under the waiver. The back of the form they sent me, if I had not read it carefully ( I am an attorney ), would seem to tell me that I am not eligible for forgiveness under XXXX because most of my XXXX months of payment were made on FFELP loans, not direct loans ( I took them out before direct loans were avaiable ), and not under the right repayment plan. FedLoan has been misleading borrowers and costing them money. CFPB should hold them accountable.

Presently, FedLoan seems to be dilatory in processing claims and in updating applicants on the status of their loans. I have been waiting since XXXX to hear whether I am eligible for the program. I am. I currently have a direct loan. I have been employed by a qualifying agency. I have made payments on XXXX loans and on direct loans. FedLoan has not acknowledged that, and appears not to have informed the Department of Education about my loans. This has cost me money and caused stress in my life. 
In the end, it's difficult not to see FedLoan acting like an insurer : reflexively denying claims and hoping that insureds will not understand their eligibility under the policy and give up. Perhaps, too, FedLoan is compensated based on how many applications they process. Forcing me to file repeated applications when the answer in my case appears simple may be financially beneficial for them. All of this points to the supreme irony in having for-profit companies administer a program designed to reward public service. If your interest centers more on profits than the people you are supposed to serve, you serve those people as little as you can get away with. 
I hope CFPB will put pressure on FedLoan to do the job they have contracted to do, to make their correspondence with borrowers clearer, and to stop shifting blame to other parties for their own failing. I also hope the CFPB can claw back some of the funds our government has provided FedLoan for administration of the XXXX program. They have no performed adequately on their contract. I also hope that some interest on unnecessary payments can be provided for borrowers who had to wait an unreasonable amount of time for the forgiveness they were due.