Consumer complaint received 2025-06-03 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Struggling to repay your loan — Problem with your payment plan
Company: MOHELA
State: PA

Complaint narrative:
My loans were included in a forbearance for the SAVE litigation and were supposedly placed at 0 interest. I received notice from MOHELA that interest was still accruing, and submitted a complaint to this Bureau. 

MOHELA responded with the below, that " that interest was from before '' ; Dear XXXX XXXX : MOHELA has reviewed your complaint made with the Consumer Financial Protection Bureau ( CFPB ) regarding interest accrual on your student loan account. On XX/XX/year>, a federal court issued a stay preventing the U.S. Department of Education ( ED ) from operating the Saving on a Valuable Education ( SAVE ) repayment plan. ED is assessing the ruling and will be in touch directly with borrowers about how this will affect them. Borrowers enrolled in the SAVE Plan are being moved into forbearance. During forbearance, SAVE borrowers will not have to make payments. The time in forbearance will not count toward Public Service Loan Forgiveness ( PSLF ) or Income-Driven Repayment ( IDR ) loan forgiveness. SAVE borrowers will not accrue interest on their loans during the forbearance. Our records indicate that your loans interest rate has been updated to reflect the 0 % interest rate associated with this forbearance. Please note that interest that accrued prior to the effective application date of the forbearance to your account is valid, and will remain outstanding. Our records indicate that no interest has capitalized on your outstanding loan. Borrowers may apply for IDR plans and/or consolidate loans by submitting a PDF application to your servicer by uploading it to your servicers website or mailing or faxing it to your servicer. Borrowers are still permitted to apply for the SAVE/REPAYE Plan even though some of its provisions have been stayed. The terms of the SAVE/REPAYE Plan are subject to the outcome of ongoing litigation. Per Federal Student Aid guidance as of XX/XX/year>, MOHELA has resumed processing applications for PAYE, IBR, and ICR unless the individual has any loans on the SAVE plan. Accounts with IDR applications that are placed on hold per Federal Student Aid ( FSA ) IDR processing guidelines will remain on the appropriate forbearance until the application can be processed. Once applications are processed, borrowers who are enrolled in the SAVE Plan may be placed in forbearance if litigation remains ongoing or if servicers cant calculate payments at the amounts required by court orders. Although the forbearance does not count toward Public Service Loan Forgiveness ( PSLF ), there are currently two ways borrowers may be able to receive PSLF credit for this time. Borrowers should review these options closely before taking any action. For more information on your options, please visit : StudentAid.gov/saveaction. Please note that interest accrues daily on federal student loans outside of these special exception periods where interest rates are adjusted to 0 %. Please note that periods of deferment or forbearance excluding special circumstance forbearances such as the XXXX administrative forbearance and SAVE court stay forbearance are ineligible for interest subsidies associated with the Saving on a Valuable Education ( SAVE ) repayment plan. If you have any other questions or concerns, please dont hesitate to contact a member of our Customer Advocacy Team at XXXX from XXXX to XXXX Mondays, XXXX to XXXX Tuesdays and Wednesdays, or XXXX to XXXX Thursdays and Fridays, Central Standard Time. You can also visit www.Mohela.StudentAid.gov. Sincerely, MOHELA '' If you would so kindly look at the letter from XXXX of XXXX and the letter from XXXX of XXXX, interest by MOHELAs own admission is still being added to the loans. So which is it? Obviously MOHELA continues to add interest since the outstanding interest totals continue to increase!

Company response to consumer: Closed with explanation