Consumer complaint received 2024-11-24 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: MA

Complaint narrative:
On XX/XX/year>, I submitted a loan consolidation request to XXXX XXXX XXXX XXXX. My application included all of my subsidized and unsubsidized student loans from XXXX loan servicers, Mohela and XXXX XXXX. The loans totals were {$41000.00} for unsubsidized loans and {$16000.00} for subsidized loans. 


I received a letter dated XX/XX/year> from XXXX stating that my loans had been transferred from the servicers to XXXX so that they could carry out the consolidation of my loans and then transferred back to Mohela. 
On or about XX/XX/year> both the Mohela and XXXX websites updated with information that the consolidation was completed and my loans were sent back to Mohela. They totaled {$16000.00} in subsidized loans and {$3300.00} in unsubsidized loans. As the total for the unsubsidized loans seemed incorrect as they should have still totaled to the original {$41000.00} I called Mohela and XXXX to confirm that the consolidation was complete and that the total was correct. 

Both servicers assured me the consolidation was complete and that {$3300.00} was the correct amount. Furthermore, I received a letter from Mohela dated XX/XX/year> confirming the completion of my unsubsidized loan consolidation with a remaining total of {$3300.00}. Having received both verbal and written confirmation that the consolidation was complete and that this was in fact the correct new total, I submitted payments on XX/XX/XXXX and XXXX, 2024 to have my consolidated unsubsidized loan paid in full. 

As I was awaiting the confirmation letter stating that my unsubsidized loans were now paid in full, I had several further communications with Mohela and XXXX. On XXXX phone call Mohela confirmed that my unsubsidized loan was both fully consolidated and paid in full. I requested this in writing and received a letter from Mohela dated XX/XX/year> that it was paid in full. By this point, the completed consolidation and the paid in full status were also reflected on the XXXX XXXX XXXXXXXX XXXX website. At this time, with multiple written documentations confirming both consolidation completion and my unsubsidized loans now paid in full, and with my only remaining loan the {$16000.00} subsidized loan, I made significant financial decisions to reflect my new lower student loan debt. 

On XX/XX/year>, I logged into my Mohela account to look into my subsidized loans and to my surprise the status on my consolidated unsubsidized student loan had changed back to repayment with a balance of XXXX + approximately {$780.00} in interest that had been accruing. The transaction was backdated as a disbursement from XXXX on XX/XX/year>. Neither of my accounts with Aidvantage or the XXXX XXXX XXXX have evidence of this disbursement ever occurring. To date, the Department of Education still shows my loan as paid in full. 

My dispute with Mohela is in regard to the following items : ( XXXX ) The {$38000.00} disbursement on XX/XX/year> was not communicated to me in any communication between XX/XX/year> and XX/XX/year> with Mohela, XXXX, and XXXX XXXX XXXX XXXX It was not listed in my account history either throughout this time and only appeared shortly before XX/XX/year> as I had last logged into my account on/around XX/XX/year> at which time it was still not there. After I paid the remaining {$3300.00} on the unsubsidized loan on XX/XX/XXXX & XXXX and after I received in writing on XX/XX/year> that the unsubsidized loan was paid in full, I made significant financial decisions. 

( XXXX ) It is unacceptable to expect me to pay interest on the {$38000.00} accruing from XX/XX/XXXX to XX/XX/year> as the loan was marked as paid in full and was gone from my accounts on Mohela, XXXX, and XXXX XXXX XXXX XXXX. There was both no indication that there was a remaining loan which was accruing interest nor was there any way for me to pay it to avoid the interest.

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