Consumer complaint received 2016-05-31
Product: Student loan — Federal student loan servicing
Issue: Can't repay my loan — Can't temporarily postpone payments
Company: AES/PHEAA (NY)

My servicer, FedLoanServicing ( " FLS '' ) is attempting to raise my monthly payment by nearly {$2000.00} ( a 400 % increase ) as a result of their own delay in processing my annual Income Driven Repayment ( " IDR '' ) re-certification. FLS is manipulating the recertification timeline to increase borrowers ' payments while they process requests for lower payments. 
Since XXXX. XXXX, I have had my {$220000.00} in student loans on the IDR plan, Pay As You Earn ( " PAYE '' ). If I were on a standard payment plan, my payments would total $ XXXX/mo, which my family can not afford ; however, with PAYE, my monthly payments were much lower, and set at $ XXXX/mo for XXXX. 
As required, each year I re-certified my income to remain on the PAYE plan. On XXXX, FLS sent a letter stating that I needed to re-certify for my IDR plan by XXXX. According to the letter, if I did not re-certify within 10 days of that date, my payment would increase to the 10-year repayment amount, which was $ XXXX -- ( 10 days from XXXX was XXXX. ) On XXXX, prior to the deadline, I filed my IDR recertification via fax, along with all supporting documents. The next day, FLS confirmed receipt of these documents. 
On XXXX, XXXX day before the recertification deadline, FLS filed an electronic letter ( dated XXXX ) notifying me that my IDR request was denied, but included no explanation as to why. Sometime between XXXX XXXX and XXXX, I called FLS for an explanation as to why. At that time, an FLS representative explained that, although I had filed all the required paperwork and supporting documents, I had checked a box in both XXXX and XXXX of the recertification form, which was improper -- XXXX was for borrowers who, like me, were already in an IDR plan and were submitting documentation for recertification, and XXXX was for borrowers that wanted to loan holder to place the borrower on the plan with lowest monthly payment. According to FLS, these Sections were " mutually exclusive, '' and denied my application. I stated that I only meant to check XXXX, but the representative stated that it could not be done over the phone and that I would have to re-file my IDR re-certification. By that point, I was already in the 10-day grace period, ending XXXX. 
Before re-submitting my IDR re-certification, I needed to gather new supporting documents, which delayed me beyond the XXXX grace period end. So, on XXXX, I called FLS to confirm that my payment would not automatically revert to $ XXXX/mo, and I explained FLS ' prior denial for the clerical error. The representative explained that if I filed my recertification, and it was processed before my XXXX payment, my payment would not increase. Accordingly, on XXXX, I re-submitted my IDR re-certification, and FLS confirmed receipt on XXXX. 
On XXXX, I logged in to check my FLS account, and saw that despite filing my annual recertification, FLS had placed me back on the standard repayment plan, and that I would owe $ XXXX/mo. I immediately called FLS. The first representative believed it was an error, but upon review, confirmed that because I failed to recertify by XXXX, I was placed on the Standard Plan. Although he first stated that I had been re-certified for IDR, he later stated that my re-certification was still processing. I asked for an " administrative forbearance, '' which usually stops payments while FLS processes an IDR re-certification, but he said I was not eligible. Instead, the representative stated that I could ask for a general forbearance, which would stop payments while FLS processed my IDR re-certification, but would capitalize {$18000.00} in interest on my loans, raising my loan balance to {$230000.00}. A supervisor echoed all of this. FLS stated that my IDR was processing and would likely be done in XXXX XXXX, after which my payment would decrease to appx. $ XXXX/mo. A borrower has not control over this timeline.