Consumer complaint received 2017-01-31
Product: Student loan — Federal student loan servicing
Issue: Dealing with my lender or servicer — Trouble with how payments are handled
Company: AES/PHEAA (TX)

I am submitting a complaint regarding AES, American Education Services. I recently sent in an extra payment of {$6500.00} on XX/XX/XXXX to pay off the loan sequence XXXX. This is a consolidated loan and I wanted to pay off the principle on the smaller loan to make it easier to see how interest was being calculated. I called and wrote down verbatim what the AES employee recommended to have this loan sequence paid off. I sent a check on XX/XX/XXXX. 
The check posted XX/XX/XXXX and found that the loan was not paid off as instructed. The amount was applied to both loans. I called on XX/XX/XXXX, the day it posted, and I was told it was not written correctly. I was told XX/XX/XXXX that he would put forth the request to have the payment apply to the one loan, and that this would take up to 7-10 business days. 
I called back on XX/XX/XXXX and was told yes, it was requested that the loan be moved to sequence XXXX, but that it was not sent in until XX/XX/XXXX ; therefore they had until XX/XX/XXXX to process this correctly ( the 10th business day ). However, today being XX/XX/XXXX, 13 business days, the payment still has not been applied correctly. Furthermore, a payment was made earlier this year for which the same thing happened. I had written a letter to apply it to loan sequence XXXX, and it was not applied correctly. I had to call back to get it applied correctly, and later found out that they did not apply it to principle only. 
I have been making regular payments and pay the simple interest with these payments. Any payments made between should go to principle only especially if I deem that that is how it should be utilized. However, persons from AES have insisted that the interest must be paid first regardless if extra payments are sent in. Anywhere that I read, that is not the case. If I am making regular payments, I should be able to send in extra money to pay down principle ONLY. 
Additionally, I have been paying more than the minimal amount on the loan. I requested over the phone an amortization schedule so that I could understand the payments of this loan. XXXX, a supervisor, said an amortization schedule could not be provided. 
I sent in a certified letter explaining these issues as well as a request for an amortization schedule XX/XX/XXXX. I had read according to Federal Register 34 CFR 682.205 Disclosure requirements for lenders # XXXX, I have a right to The borrower 's repayment schedule, including the due date of the first installment and the number, amount, and frequency of payments based on the repayment schedule selected by the borrower. 
Additional I am noticing AES is specifically trying to garner more interest payments by not following the directions that I set forth in the letter sent with the payment. If you look at the XX/XX/XXXX payment of {$25000.00}, {$69.00} went to interest on a balance of {$110000.00} with 22 days since last payment. All of that should have gone to principle. When I paid {$6500.00} on XX/XX/XXXX then I paid {$87.00} in interest on a balance of {$83000.00} with 11 days since last payment. Does this make sense to you? Why is there an increased interest on a smaller amount of principle? The days between regular payments were less on the {$6500.00} amount than on the {$25000.00} amount. If there is a shorter time between loan payments ( 11 days versus 22 days ), there should be less daily interest that has accrued, correct? The loan principle has also been decreasing with regular payments and the additional {$25000.00} payment XX/XX/XXXX. How am I paying more interest now XX/XX/XXXX than I did XX/XX/XXXX? All of the recent payment was supposed to go to pay off the loan sequence XXXX for the subsidized portion of the loan, but instead was split up between XXXX loans where more of the percentage of the payment went to interest. They did not follow my explicit instructions for the extra payment, therefore acquiring more interest payment.