Consumer complaint received 2025-07-16 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: WI

Complaint narrative:
In XX/XX/XXXX, I had been trying to contact MOHELA ( ten times between XX/XX/XXXX and XX/XX/XXXX ) regarding my discovery of an incorrect total student loan balance that had accrued between XX/XX/XXXX through XX/XX/XXXX. I had capitalized interest wrongfully applied to my loans while in forbearance and a 0 % interest applied to my account. 
My last statement repayment schedule from MOHELA as of XX/XX/XXXX has the principle & accrued unpaid interest balance total of {$180000.00} and the total to be repaid over the life cycle of the loan ( XXXX as of that date ) to be {$250000.00} ( see attached document ). I have been in forbearance with 0 % interest accrual since XX/XX/XXXX and prior to that have been making payments to both the principle and interest since the CARES Act coverage ended in XX/XX/XXXX ( see attached document ). The total should not have changed outside of payments I made during forbearance, however, MOHELA has stated that I currently owe roughly $ XXXX ( total current balance ), not on the life cycle of the loan. That would mean that the loan servicer would have made roughly {$63000.00} of interest between XX/XX/XXXX and XX/XX/XXXX while I was in this 0 % forbearance. I believe and can prove that my interest has been applied wrongfully while in forbearance and they have incorrectly taken the estimated total amount to be repaid over the life cycle of the loan and applied it to my current balance. 
When expressing this to the MOHELA representatives multiple times they stated only XXXX can review interest rates and there's nothing they can do and put me on extended holds. When contacting XXXX, representatives state this is not correct and only my servicer can correct/investigate the interest rate accrual. I was told by XXXX to obtain a dispute/complaint form with MOHELA, but the MOHELA representative stated he never heard of this form and the submit claim link on the MOHELA website opens the FSA website to the Feedback link. MOHEAL representatives have tried to transfer me to the Resolution Team but wait times have been anywhere from 3 hours to 2 business days. I was told by a MOHELA supervisor that this issue would be resolved by XX/XX/XXXX, which it has not been. No one will account for this wrongdoing and fix this issue, leaving me with tens of thousands of dollars of incorrect interest accrual to have to pay back starting XX/XX/XXXX. It seems my only other options are to submit a complaint with the Consumer Financial Protection Bureau and the Wisconsin Department of Financial Institutions and hope they are able to resolve this issue quickly. 

XXXX of Events : XX/XX/XXXX : XXXX total current loan balance has increased by $ XXXX while in forbearance with 0 % interest applied to loans and unable to pay on the principle. 
XX/XX/XXXX XX/XX/XXXX : Called MOHELA XXXX times due to being put on long holds, no callbacks, and the issue left unresolved XX/XX/XXXX : Submitted Feedback Case # XXXX with supporting documentation to the Federal Student Aid website. 
XX/XX/XXXX : Waited on long hold for MOHELA XXXX XXXX member. XXXX states this issue has happened to many accounts and will be resolved by XX/XX/XXXX before interest accrual kicks back in. 
XX/XX/XXXX : XXXX replies to my XXXX case with a screenshot of the MOHELA website with my loans and the incorrect total balance displayed. Then they close the case. 
XX/XX/XXXX : Receive email from U.S. Department of Education stating interest will begin to accrue on SAVE PlaXXXX loans on XX/XX/XXXX. 
XX/XX/XXXX : Called MOHELA and FSA to follow up with account. 
o MOHELA Representative XXXX would not answer questions regarding my interest. Said she had to transfer me to a different representative ( wait time XXXX hours and XXXX min ) o MOHELA Representative XXXX looked into my account and stated, I see interest has quadrupled since XX/XX/XXXX. XXXX have to transfer you to a supervisor ( XXXX business day wait ). 
o XXXX Representative XXXX suggested to escalate my closed XXXX case to the Ombudsman Group by replying to the original email. Stated there is no required window of time that the Ombudsman Group would get back to me in.

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