Consumer complaint received 2024-04-30 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: MOHELA
State: TX

Complaint narrative:
I reached out to Mohela to inquire about my recent student loan transfer, specifically why my monthly payments increased, and why my XXXX payment had not been Auto debited from my account. I received an email fros the XXXX XXXX XXXX XXXX stating that my loan servicer would be changed ( from XXXX to Mohela ). The email stated the following : " You might have already received instructions for creating your account in the new environment. If you haven't, you will receive an email 15 days before your account transfers. '' My loan payment was to be auto debited from my account on XX/XX/XXXX. I received an email from XXXX on XX/XX/XXXX stating, " Your Recurring Special Payment Instructions Have Been Removed. '' My first welcome email from Mohela was on XX/XX/XXXX. 

I reached out to XXXX and I was informed by a representative that my account was marked " XXXX '' during the transfer. When questioned why my account has accrued interest amount of {$350.00}, when my XXXX monthly payment was only supposed to be {$410.00}, I could not be given an answer. 

When I questioned Mohela about why my monthly payments would now be going up from {$410.00} to {$470.00}, the first representative I spoke with stated that it would likely have to do with changes in my income, as well as the " financial hardship '' that was placed on my account. When I informed the representative that I had never applied for a financial hardship and that my household income from XXXX to XXXX actually decreased, I could not get an explanation as to why this changed. The representative then stated that if I needed to look into lower monthly payments I could look into the different repayment options and apply. 

I then contacted XXXX, and I was informed that my account " was pulled by Mohela '' on XX/XX/XXXX, so my XXXX payment would not be able to be made or forwarded to Mohela to give me credit for an XXXX payment since I no longer had access to make payments to my account as it was " paid in full. '' The XXXX representative also informed me that there was no way for XXXX to know when Mohela would be " pulling accounts '' just as mine had been " pulled. '' I contacted Mohela a second time via phone call. The second representative informed me that the increase in my monthly payment is due to my account now being under " Mohela standards. '' When questioned why I was not able to make a payment and still have interest accrue, I was informed that this is " standard practice for all loan transfer processes '' and interest still accrues during this time even though borrowers are unable to access their account to make their normal scheduled monthly payments. 

My previous monthly payment to XXXX went from {$410.00} to transfer over to Mohela to now being {$470.00}. With {$330.00} accrued interest to pay all because of the standard loan transfer processes. All I am asking for is an explanation as to the discrepancies in amounts and why borrowers are being penalized for loan transfers that are out of our control and I can not be given an answer. The only answer I received was from a Mohela representative that stated that accounts are " not neglected, '' but this is simply the loan transfer process. 

After speaking with both Mohela represenatives, I stayed on the line to complete the phone survey, but after a few minutes of waiting, I was transferred back into the queue to speak to a representative. After speaking with the XXXX representative, I thanked her for her help and was immediately hung up on, which did not allow me the chance to fill out the phone survey. 

When looking online to file a complaint, there is no option for XXXX. However, Mohela has an option, but it prompts you to call in to speak to a representative. 

I am beyond frustrated with the student loan repayment process and the added amounts of money that we have to pay without any further explanation. I have no more faith in our system.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation