Consumer complaint received 2019-11-27
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: AES/PHEAA (NY)

I consolidated all Parent Student Pus Loans with my bank XXXX XXXX and paid off all the loans including Fedloan Servicing in XXXX XXXXand I started paying XXXX XXXX  for the loan. Then in XX/XX/XXXX, I started receiving emails from Fedloans Servicing and thought it was some glitch in their system. I continued to receive emails every month and I continue to ignore them until XX/XX/XXXX. I logged into the website of Fedloan Servicing to check what's the reason I am receiving the emails and I find out that I have a balance. I called and spoke to customer service explaining that I have proof of payments of three checks accompanied of three letters clearly stating the payment of the three loan in full. They told me that they received the checks and applied them to the account and they do not have records of the letters because it's another department that handle that. I sent them to them copies of the checks and the associated letters. I continued calling to follow up and during my follow-ups I explained to them that the account is paid in full and they should close the account. They refuse to do so and since they made the mistake by depositing the checks and disregarding the letters indicating the full payment of the account to clean there mess, they issued three treasury checks of the amount that paid in full the Fedloan Servicing in XX/XX/XXXX and sent the account to a collection agency. I received the three treasury checks, I wrote void on them and returned them back to them. The collection agency corresponded with me regarding the account, I sent them the proof of payment in full and I called them. They had nothing to say to me other than it's under investigation. I continued to contact the collection agency and at the end they told me that file is back to Fedloan Servicing and they will not contact me an more. In XX/XX/XXXX or XXXX, XXXX, Fedloan Servicing used another tactic by sending three treasury checks to XXXX XXXX  directly stating on the stub " Refund ''. XXXX XXXX   get the checks and deposited them directly into my account without our consent. We did not realize we had that money in aour XXXX XXXX  account until XX/XX/XXXX. We called XXXX XXXX customer service and they stated that we received a refund from the treasury department of XXXX, we asked for what? and they had no explanation. We realized the tactic Fedloan Servicing used to hook us up for the full payment already made in XX/XX/XXXX and we told the customer service that we did not endorse those checks into our account and please remove it from our account. They told us to go in person to the bank. I went to the bank and spoke to V.P. Store Manager XXXX XXXX ( XXXX XXXX ) regarding the above matter and asked him to remove the money that is definitely not ours and we did not deposit those checks. He told me that he will check with XXXX XXXX  corporate legal department and get back to me. He never did, then I payed him a visit on the morning of XX/XX/XXXX and asked him regarding the out come with his corporate legal department, he said I can not do anything. Now Fedloan Servicing has erased all activities on my account and made it look like I did not make any payment and reinstated the interest like they did not have the full payments since XX/XX/XXXX.