Consumer complaint received 2025-08-30 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Incorrect information on your report — Account status incorrect
Company: MOHELA
State: MD

Complaint narrative:
Subject : Formal Complaint Against MOHELA for Unfair Credit Reporting Practices To Whom It May Concern, I am writing to formally file a complaint against MOHELA regarding the unfair credit reporting practices that have severely impacted my credit score. My name is XXXX XXXX. 
Recently, I noticed a significant drop in my credit score due to a XXXX past-due mark reported on my credit report. This occurred after I applied for forbearance on my loans, as I was experiencing financial difficulties. Following the forbearance period, I attempted to set up an income-based repayment ( IBR ) plan, but due to changes in policy under the previous administration ( XXXX ) , the income-based payment option was temporarily unavailable. During this time, MOHELA removed my loans from forbearance, which led to a reported past-due status. 
I want to emphasize that I made every effort to stay in good standing and follow all necessary procedures. The removal of the forbearance without proper communication, and the subsequent reporting of this as a past-due status, was unjust and has caused significant damage to my credit score. My credit report dropped by XXXX points, which is particularly concerning as I have XXXX loans, and now I am unable to consolidate them due to the past-due status. This means I can not take advantage of the benefits of consolidation or income-driven repayment, which further complicates my situation and hinders my ability to manage my loans. 
After I called MOHELA and explained the situation, my account was placed in good standing again, and my loans were returned to forbearance while I applied for the income-based repayment plan. However, despite this resolution, MOHELA has refused to fix the inaccurate credit reporting that has caused long-term damage to my credit score. This error continues to negatively affect me in several ways, including issues with my employment, an excessive XXXX  % interest rate on a car purchase, and my inability to refinance my house with my husband due to the low credit score. We also need to add a bathroom on the bottom floor of our house due to my husband 's upcoming XXXX  XXXX, and the financial strain from this situation is making it even harder to move forward with these necessary home modifications. 
I believe this situation arose from a lack of communication on your part regarding my loan status during the transition in policies, and I should not be held responsible for circumstances outside of my control. In addition, I believe that MOHELA should not rely solely on mail for important communications. Given the nature of the issue and its impact, I strongly feel that direct phone calls should be made to ensure clear communication and to resolve any misunderstandings promptly. 
I request that MOHELA : XXXX. Correct the inaccurate credit report entry, removing the XXXX past-due status. 
XXXX. Provide a clear explanation for the lack of communication regarding the change in my loan status. 
XXXX. Work with the credit bureaus to ensure my credit score is updated to reflect accurate information. 
XXXX. Implement a more direct approach in communication, including phone calls to avoid further confusion and delays. 
I also request that MOHELA review my eligibility for income-based repayment and Public Service Loan Forgiveness , as I meet the criteria for both and have always sought to remain compliant with my loan requirements. 
This issue is having a serious and ongoing impact on my financial stability, and I would greatly appreciate your prompt attention to this matter. Please confirm receipt of this complaint and provide an update on the steps being taken to resolve this issue. 
Thank you for your time and consideration. 
Sincerely, XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX

Company response to consumer: Closed with explanation