Consumer complaint received 2026-01-20 00:00:00
Product: Student loan — Private student loan
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: SLM CORPORATION
State: TX

Complaint narrative:
I am the debtor and primary borrower on certain private student loan accounts serviced by Sallie Mae. 
I filed a voluntary petition for relief under XXXX XXXX of the Bankruptcy Code. An automatic stay pursuant to 11 U.S.C. 362 ( a ) became effective in XXXX and remained in effect until XX/XX/XXXX. ( see documentation below. ) Sallie Mae received notice of my bankruptcy filing and issued electronic communications acknowledging the bankruptcy and stating that no payment was due at that time. ( see documentation below. ) During the automatic stay, Sallie Mae restricted my access to my online borrower account, preventing me from viewing loan balances, payment status, correspondence, or notices. No physical mail regarding payment obligations or account status was sent to me during this period. 
While the automatic stay was in effect, Sallie Mae unilaterally altered its internal servicing designation by treating the cosigner as the primary borrower, despite the loan contract identifying me as the primary borrower. ( see documentation below. ) During the stay, Sallie Mae contacted the cosigner by telephone and electronic communications seeking payment on the loans. These communications occurred while Sallie Mae had knowledge of the bankruptcy filing and the automatic stay. 
The cosigner did not have an online account with Sallie Mae and did not select electronic delivery preferences. Sallie Mae nevertheless relied on electronic communication preferences selected by me to justify the absence of mailed notices, while sending electronic messages stating that documents were available online. 
After termination of the automatic stay, Sallie Mae reverted the borrower and cosigner designations to their original status and asserted that the loans were delinquent due to nonpayment during the automatic stay, demanding retroactive payment for that period. ( see documentation and recorded communication below ) Sallie Mae reported the loans as XXXX or more days past due to consumer reporting agencies beginning in XXXX, including periods when the automatic stay was in effect. ( see documentation below. ) Any alleged delinquency arose solely from XXXX XXXX conduct during the automatic stay and did not exist prior to the bankruptcy filing. 
XXXX XXXX actions caused emotional distress, significant time expenditure, and damage to my credit profile, and interfered with the fresh start protections afforded by the Bankruptcy Code.

Sallie Mae had actual notice of my Chapter 7 bankruptcy and the automatic stay imposed under 11 U.S.C. 362. Notwithstanding that notice, Sallie Mae engaged in conduct that includes, but is not limited to : ( 1 ) indirect collection activity during the automatic stay by reclassifying the cosigner as the primary borrower and contacting the cosigner for payment ; ( 2 ) restricting borrower access to account information while representing that no payment was due ; ( 3 ) retroactively assessing delinquency for the stay period ; and ( 4 ) furnishing inaccurate delinquency information to consumer reporting agencies.

Anticipated Company Position and Clarification 1. Internal Policies and Procedures Anticipated Position : Sallie Mae may state that its internal policies and procedures were followed. 

Clarification : Internal policies and procedures do not supersede federal consumer protection laws applicable to private student loan lenders and servicers. Even where a company asserts compliance with its internal processes, the resulting conduct must still comply with : UDAAP prohibitions under 12 U.S.C. 5531 and 5536, FCRA accuracy and furnishing obligations under 15 U.S.C. 1681s-2, and Bankruptcy Code protections, including the automatic stay under 11 U.S.C. 362.

In this matter, Sallie Maes procedures resulted in the assessment of retroactive delinquency for a legally protected period, conflicting representations regarding payment obligations, and furnishing of misleading credit information. A servicing practice that produces outcomes inconsistent with federal law is not compliant, regardless of whether it aligns with internal policy. 

2. Credit Reporting Accuracy and Automation Anticipated Position : Sallie Mae may assert that credit reporting is accurate, automated, or outside its control once furnished to consumer reporting agencies.

Clarification : Under the Fair Credit Reporting Act, furnishersincluding private student loan lendersare responsible for ensuring the accuracy and completeness of information they provide to consumer reporting agencies. Reporting an account as delinquent for a period during which : payment was subject to a bankruptcy automatic stay, and the borrower was informed that no payment was due, is materially misleading. The use of automated systems does not relieve a furnisher of its statutory obligation to ensure that reported information accurately reflects the legal status of the account. 

3. Cosigner Liability and Collection Activity Anticipated Position : Sallie Mae may contend that collection activity was permissible because a cosigner remained contractually liable.

Clarification : While a cosigner may remain liable under the loan contract, the conduct at issue exceeded permissible cosigner collection. During the bankruptcy period, Sallie Mae : internally altered borrower and cosigner designations without notice or authorization, relied on that alteration to maintain account activity during the automatic stay, and subsequently reversed the designation and carried forward delinquency to the primary borrower. 

This sequence reflects procedural handling that materially affected account status and post-bankruptcy delinquency, rather than ordinary cosigner collection activity, and directly contributed to retroactive payment demands and credit reporting harm. 

4. Repayment Programs and Upfront Payment Requirements Anticipated Position : Sallie Mae may state that repayment or assistance programs require financial review and an upfront payment before eligibility can be determined.

Clarification : While private student loan lenders may evaluate financial information, conditioning access to repayment options on an unspecified and undisclosed upfront payment, while refusing to disclose eligibility criteria or required amounts, raises concerns under XXXX. Withholding material information needed for a consumer to understand available options and obligations, while simultaneously demanding payment, constitutes unfair and potentially abusive servicing conduct. 

Purpose of This Clarification These clarifications are provided to ensure the CFPBs review focuses on the legal effect of XXXX XXXX servicing practices, rather than on whether internal policies were followed. The issues raised concern post-bankruptcy payment handling, credit reporting accuracy, and transparency, all of which are subject to federal consumer protection requirements for private student loan lenders.

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