Consumer complaint received 2025-11-13 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: Maximus Federal Services, Inc.
State: CT

Complaint narrative:
Subject : Formal Complaint Improper Payment Application and Interest Allocation by Aidvantage To the Consumer Financial Protection Bureau, I am submitting a formal complaint regarding improper servicing of my federal student loans by Aidvantage. My account history contains multiple irregularities, including misapplied payments, excessive interest allocation, and unexplained capitalization events. These errors have directly increased my balance and distorted the amortization of my loans. 

Below is a detailed summary of the inaccurate payment allocation patterns documented in my Aidvantage Account History. These examples show that even when I paid more than the required amount, Aidvantage applied an abnormally high portion of each payment to interest instead of principal. 

PAYMENTS WITH EXCESSIVE INTEREST ALLOCATION : * * XX/XX/XXXX * * I paid * * {$400.00} * * ; Aidvantage applied * * {$140.00} to interest * *. 
This represents nearly 40 % of the payment, which is inconsistent with proper amortization for an unsubsidized federal loan. 

* * XX/XX/XXXX * * I paid * * {$600.00} * * ; Aidvantage applied * * {$140.00} to interest * *. 
This interest portion is unusually high given the size of my payment and the loan balance at the time. 

* * XX/XX/XXXX * * I paid * * {$300.00} * * ; Aidvantage applied * * {$69.00} to interest * *. 
This is significantly higher than expected for a regular monthly payment. 

* * XX/XX/XXXX * * I paid * * {$400.00} * * ; Aidvantage applied * * {$130.00} to interest * *. 
This level of interest indicates improper application of payments. 

These payments, which exceed or equal my normal obligations, should have substantially reduced my principal balance. Instead, the majority of each payment was diverted to interest, suggesting that Aidvantage was advancing my due date instead of applying the payments directly to principal, resulting in unnecessary interest accumulation. 

UNEXPLAINED CAPITALIZATION EVENTS : * * XX/XX/XXXX * * Every loan received a Capitalized Interest {$0.00} entry. 
* * XX/XX/XXXX * * Every loan again received a Capitalized Interest {$0.00} entry. 

Aidvantage did not disclose the amount of interest that was capitalized or provide any explanation for these mass events. Federal regulations require servicers to report capitalization amounts clearly. These entries appear to represent undisclosed reprocessing of my account. 

IMMEDIATE SHIFT IN PAYMENT BEHAVIOR : After these unexplained capitalization entries, the way my payments were applied changed abruptly : * * XX/XX/XXXX * * A {$500.00} payment resulted in only * * {$29.00} interest * *. 
* * XX/XX/XXXX * * A {$600.00} payment resulted in only * * {$37.00} interest * *. 

This dramatic reduction in interest charges confirms that earlier payments were mishandled. The account behavior normalized only after Aidvantages internal system adjustments, implying that the earlier months were serviced incorrectly. 

Thank you for your attention to this matter. I respectfully request the Bureaus assistance in ensuring my account is corrected and that Aidvantage provides a full and transparent explanation of their servicing actions.

Company response to consumer: Closed with explanation