Consumer complaint received 2024-02-01
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Received bad information about your loan
Company: MOHELA (KY)

I have worked in public service since XXXX but due to the type of loan repayment I was on I was unable to qualify for Public Service Loan Forgiveness. I had decided to just make larger payments to pay off the loan rather than switch repayment since I would be putting more towards the principal each month. I had been serviced by XXXX  XXXX from XXXX to XXXX. I had applied in XXXX to PSLF and was denied due to the repayment schedule. I had done the math and I would end up paying more if I switched due to the payments I had already made and the monthly payment amount. 

When the covid payment pause went into effect I continued to pay since I could finally make a real dent in the principal since the interest was frozen. I made 28 payments of {XXXX} during this time. In XXXX on XXXX I was finally able to qualify for PSLF thanks to the limited waiver program. At that time my loans were moved to Mohela. I had no way to continue to make payments at that time due to the payment freeze and being a new client without and owed balance. I therefore waited till repayment started before continuing to pay. I had received notification that I had made 113 qualifying payments at the time of my approval into the program in XX/XX/XXXX. I was never notified that the covid pause was counted as payments at any point by XXXX, Federal Student Aid, or Mohela. I have gone back and re-read all of my communications and this was never listed. On XX/XX/XXXX of XXXX was the first reference to these paused payments counting toward the PSLF program in an email about starting repayment. At this time I sent a message on XX/XX/XXXX to Mohela referencing this email and asking if this mea n't I was done paying my loan. I was informed in the auto response they would respond in 15 days. They responded on XXXX XXXX 43 days later, saying that these covid paused payments did count and that I had to recertify to update my qualifying payment count. 

I immediately rectified and was notified on XX/XX/XXXX that I had 126 qualifying payments, not 113. This was the first time I was made away that these non-paid paused payments counted. At this time I immediately called and requested my full payment history since I knew I had over paid in the XXXX as well as during covid. At no time did they mention not being able to request this as a refund. I immediately requested the 2 payments I had made in XXXX and XXXX of XXXX since they were over the required 120 payments needed for forgiveness. Since my loans had moved from XXXX to Mohela I had no way of seeing my past payment history to know how much I had overpaid throughout the many years. 

On XX/XX/XXXX I finally received my full payment history in the mail. It was at that time I was able to see that I had overpaid {$6800.00} total, XXXX} of that being paid during the covid pause. At that time I immediately looked up how to request a refund and was only then notified that refunds could no longer be requested after XX/XX/XXXX for payments made during the covid pause. At that time I went and searched every email and conversation with any servicer and not one mentioned a refund, this date, that these months were counted whether and actual payment was made or not, no reference in any communication at any time. The first and only reference was in an email sent after the refund date had passed and it did not directly what was and was not counted or that refunds had been issued or that the refund time ended. I am attaching this email and the other referenced communications. 

I have spoken to Mohela and informed them of this and they informed me they were aware there was no notification but that they could not process a refund for this {$4900.00} due to the XXXX XXXX XXXX refund deadline passing. 

My complaint is that whether the refund can be requested or not, I was not notified at any time about any part of these paused payments counting or refunds being requested until after the deadline. This {$4900.00} is there for not a payment made towards my loan but funds being held XXXX and not being applied to any debt. From the time I was able to qualify for the program I stopped payments so these were not payments made in error, these were payments made with the good faith effort to repay a debt I had no reason to believe would ever be forgiven. 

I believe there for it is illegal for these funds to be held whether the refund time has passed or not given the lack of transparency and the immediate action upon notification on my part. Please advise on how best to proceed with this complaint to resolve this issue for myself and for what is surely millions of others who also attempted to repay this debt. I am simply requesting the {$4900.00} back as it is not being applied towards moneys owed.