Consumer complaint received 2024-05-21 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Problem with customer service
Company: MOHELA
State: WA

Complaint narrative:
I have been having substantial difficulties with my loan servicer MOHELA and it has gotten to a point where I am now being financially harmed by their incompetence and refusal to process my requests. In XXXX, I applied for the XXXX XXXX to Repayment ( case # XXXX ) and at that time requested to be placed in forbearance on my XXXX application. I am part of the XXXX XXXX XXXX XXXXXXXX and awaiting a decision which per the settlement agreement, the Dept of Ed has 3 years to decide on my application or else I will be provided the same level of settlement as the Full Class members. 

I called MOHELA ( Account # XXXX ) on XX/XX/XXXX to inquire about my forbearance status and I was told I was not in forbearance. After receiving my updated PSLF count under the expanded program, I decided I did not want to be in forbearance and I wanted to continue making payments to count towards PSLF. 

I received a letter from MOHELA dated XX/XX/XXXX stating I was placed on SAVE IDR Repayment Plan and my monthly amount {$68.00} ( 7 months ). I called MOHELA on XX/XX/XXXX and was told I was not in forbearance, was given an upcoming payment amount of approximately {$69.00} a month and told payments would resume in XXXX, XXXX. I then received XXXX letters dated XX/XX/XXXX. XXXX stated I had XXXX eligible payments, XXXX qualifying payments, and XXXX remaining payments to qualify for PSLF. The second gave me a new monthly repayment amount of {$23.00} ( 6 months ). 

I logged into my MOHELA account on XX/XX/XXXX to check when payment was due and it said I was now in forbearance and no payment was due. I called MOHELA and in speaking to the representative on the phone I requested to be taken off forbearance so my payments will count towards PSLF. The representative told me they would process my forbearance and I could make a payment right away to make my due date of XX/XX/XXXX ( which I couldn't see a due date online because it was set to forbearance ). I made a payment of {$23.00}. 

On XX/XX/XXXX, I logged into MOHELA to check on my XXXX payment and it still showed I was in forbearance. I contacted the FSA Ombudsman and they told me FSA had to take me out of forbearance and that my BDR case manager would be calling me within XXXX hours. I never received a phone call from my case manager. Also on XX/XX/XXXX, the Dept of Ed posted a press release in which they found MOHELA failed to meet its basic obligation by failing to send billing statements on time to XXXX XXXX borrowers and has directed MOHELA to place all affected borrowers in forbearance while the issue is resolved. Any months these borrowers are in forbearance will count as credit towards loan forgiveness through Public Service Loan Forgiveness and Income Driven Repayment plans. 

On XX/XX/XXXX, I called MOHELA again to request being taken out of forbearance. The first customer service representative appeared knowledgeable of my situation and informed me that I was taken out of forbearance after my first request, but was placed back into forbearance following a directive from the Dept of Ed. This representative was going to go ahead and put in another request that I be taken out of forbearance, but in the middle of the call we got disconnected. I called again, had to wait on hold again, and got a new customer service representative that was less knowledgeable of the situation. I requested to speak to the original representative again, but was told she had clocked out and left for the day. I had to re-explain my situation again and requested to be taken out of forbearance. This second representative appeared confused and tried to reassure me that I have not lost any time towards PSLF because my current forbearance situation fell under the Dept of Ed directive. This customer service representative could not say how long that forbearance was to last, and they outright refused to put anything they said into writing per the direction of their supervisor. So I was again told I would be taken out of forbearance per my request and any time spent in forbearance would still count towards PSLF as stated in the Dept of Ed press release, but MOHELA would not provide any of this in writing for my records. 

I received a letter dated XX/XX/XXXX stating I had XXXX eligible payments, XXXX qualifying payments, and XXXX remaining payments to qualify for PSLF. I received a letter dated XX/XX/XXXX reminding me to recertify my income. I dont remember the date I submitted my income recertification, but I completed it online in which I gave permission online for the IRS to send my tax return info for income verification, and on the form there was a box I marked again requesting to be taken out of forbearance. Since I was still seeing online that I was still in forbearance, I believed having a form with this box marked could get them to finally remove me from that status. 

I received a letter dated XX/XX/XXXX in which I was placed on the SAVE IDR Repayment plan and my new monthly payments would be {$650.00} ( 12 months ). I then received a letter dated XX/XX/XXXX notifying me I was placed in forbearance. I got another letter dated XX/XX/XXXX stating I had XXXX eligible payments, XXXX qualifying payments, and XXXX remaining payments to qualify for XXXX. 

I am stuck where I want to make my payments because I am so close to PSLF relief, but payments made in forbearance dont count towards PSLF count and I can not get MOHELA to take me out of forbearance status. As such, I am seeing significant financial harm. As of today ( XX/XX/XXXX ) my loan balance is sitting at {$480.00}, XXXX and continues to accrue interest. I am less than XXXX years away from PSLF discharge for all loans while I wait to hear if my BDR case discharges my fraudulent school loans ( which I expect to be more than {$400000.00} of my balance ). I am still working in a public service qualifying job and none of my time is counting so my progress towards discharge is stalled. And I was unable to take advantage of my initially 6 months payment amount ( {$23.00} compared to my current {$650.00} ). Even if I was allowed to start making qualifying payments today, thats {$3700.00} more in payments that I will have to pay because MOHELA refused to process my request to come out of forbearance and take my payments.

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