Consumer complaint received 2025-01-15 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Received bad information about your loan
Company: MOHELA
State: IA

Complaint narrative:
My federal Direct student loans are currently on the SAVE payment plan. I electronically submitted an IDR Application to switch to IBR using the studentaid.gov application tool linked in Mohela 's FAQs webpage. On XX/XX/XXXX, Mohela uploaded a letter to my online account stating they could not grant my application because it was missing my signature. I reviewed the PDF of my application on my studentaid.gov account, and my name was typed in the signature field like all my previously submitted and approved electronic applications. 

On XX/XX/XXXX, I called the Mohela customer service tool-free number to inquiry about the denial. During the conversation, the Mohela representative informed me that Mohela stopped accepting electronic signatures in XX/XX/XXXX, so all IDR applications require physical signatures. I explained I had submitted my application through the online portal and had not been informed the application required a physical signature. I also asked how they could not accept a form submitted through an online tool Mohela directs borrowers to use. The representative repeated that Mohela does not accept electronic signatures. Further attempts to reason with the representative were unproductive. 

Additionally, when I asked that my loans be placed on a PSLF-qualifying processing forbearance for the 60 days following my submission of my IDR application in XXXX, the representative informed me that the general forbearance on my loans could not be changed to a processing forbearance because I did not have a currently pending IDR application. I pointed out Mohela had been processing my IDR application from XX/XX/XXXX, until they denied it on XX/XX/XXXX, so I should have been placed on a processing forbearance during that time. After placing me on hold to speak with her supervisor ( named either XXXX or XXXX XXXX, the representative returned to our call and told me that she was submitting a request to the team that handles forbearances to ask that my loans be switched to a processing forbearance for the 60 days following my application 's submission in XXXX. She further informed me that this request would take 5-10 days to process. 

All of this is compounded by the fact that my remaining direct loans have 119 PSLF-qualifying months, meaning I only need one more qualifying month to trigger forgiveness. In addition to the issue described above, I told by Mohela on a phone call on XX/XX/XXXX, that the forbearance placed on my loans for that month would qualify for PSLF when I called to request the forbearance be removed from my loans in order for me to make my final payment. I was told not to worry and submit an ECF at the end of XXXX. I did so only to find that XXXX designated XXXX as well as XX/XX/XXXX as ineligible, even though I had made a payment in XXXX. I submitted a reconsideration request for both months, and eventually XX/XX/XXXX was marked eligible and qualifying, though XX/XX/XXXX remains ineligible. 

Mohela 's failure to accept IDR application forms submitted to through an online portal their own website instructs borrowers to go to is an unfair business practice at minimum and could be seen as deliberately delaying and/or preventing forgiveness for borrowers entitled to PSLF. Mohela 's actions, whether by incompetence, negligence, or malice, have repeated denied me the ability to fulfill my obligations under PSLF and prevented the discharge of my loans.

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