Consumer complaint received 2025-04-29 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: FL

Complaint narrative:
I am submitting this complaint because my federal student loan servicer, MOHELA, has improperly applied interest to my loans during a SAVE forbearance period that should have carried a 0 % interest rate. 

On XX/XX/2025, I received communication from MOHELA, confirming my placement in interested free SAVE forbearance with the following statement : While you are in this forbearance no payment is required on your account and your interest rate will be set to 0 %. This means no interest will accrue while you are in the forbearance. 

Despite qualifying for the 0 % interest SAVE forbearance, MOHELA continued charging a 6 % interest rate on my loans, resulting in over {$17000.00} in improperly accrued interest. At the time my loans entered forbearance, I was current on my SAVE payments and had approximately {$0.00} in accrued interest. I initially assumed the issue was administrative and would self-correct, but the interest continued to grow month after month. 

On XX/XX/2025, after failed email attempts and excessive phone wait times, I faxed MOHELA with supporting documents ( screenshots and account summaries ) requesting correction. I received no response. 

On XX/XX/2025, I submitted a complaint to Federal Student Aid ( FSA ) ( Case Number XXXX ). After receiving no response, I escalated the matter to the FSA Ombudsman Group on XX/XX/2025, again submitting supporting documentation. 

On XX/XX/2025, I also spoke with MOHELA representatives by phone. A front-line agent and an advanced agent ( XXXX XXXX XXXX ID : XXXX ) confirmed verbally that my account was placed in the wrong forbearance status, causing the improper interest accrual. They acknowledged that other borrowers had been placed correctly under 0 % interest SAVE forbearance, and that Federal Student Aid was working to identify and fix affected accounts. However, they refused to provide any written confirmation of the error or any timeline for resolution. 

Because of this ongoing error : I am unable to make payments without risking application to incorrect interest. 
I can not switch repayment plans without risking capitalization of the wrong interest. 
My loan balance is inflated, which could negatively affect my credit and financial profile. 

I am attaching screenshots of my account information from XX/XX/2025, which clearly show : Total accrued interest at that time was {$15000.00}. Since XX/XX/2025, the amount of improperly accrued interest has continued to increase. 
The incorrect interest rate of 6 %, My current payment plan of Saving on a Valuable Education ( SAVE ), of which my interest rate should be 0 % on current SAVE forbearance. 

Also attached is my XX/XX/2025 statement from MOHELA that I am in SAVE forbearance which should be interest free. 

As of today, I am still awaiting a response from both FSA and the FSA Ombudsman Group. No corrective action has been taken on my account, and no written confirmation has been provided.

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