Consumer complaint received 2025-01-14 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: MOHELA
State: CO

Complaint narrative:
Background : I was enrolled in XXXX and placed in the XXXX XXXX  I submitted an XXXX XXXX ( XXXX ) XXXX XXXX to enroll in a different plan on XX/XX/XXXX. My goal was to make payments that qualified for XXXX as the XXXX XXXX did not. On XX/XX/XXXX, the XXXX XXXX XXXX announced that XXXX applications were again being processed. On my XXXX  account, the page states Your loan servicer has received your application. Theyll start reviewing it, including any documentation of income provided, and will notify you once their review is completed. As my XXXX  application can now be processed and I am not receiving XXXX credit due to the XXXX XXXX, I wanted to be placed on a processing forbearance. 
I called Mohela on XX/XX/XXXX at XXXX XXXX and requested to speak to a representative regarding my XXXX application and a processing forbearance. The wait time was approximately XXXX minutes and I requested a call back. I received a call back approximately XXXX hours and XXXX minutes later and spent and additional XXXX hour and XXXX minutes on the phone with Mohela. 
I first spoke to a representative who was unable to help me and transferred me to some sort of advanced representative. I was placed on another long hold. The advanced representative stated that rules and regulations prevented me from being placed on a processing forbearance. I asked what the rules and regulations were and the advanced representative directed me to this website : https : //studentaid.gov/announcements-events/save-court-actions and, specifically, the XXXX does forbearance affect me? section. I read it and stated that there is no rule or regulation that prevents me from entering a processing forbearance. The advanced representative placed me on another lengthy hold and connected me with a dispute resolution XXXX. 
The dispute resolution XXXX did not state that there was a rule or regulation preventing me from being put on a processing forbearance. Instead, the dispute resolution XXXX stated that I couldnt be put on a processing forbearance because Mohela had not received guidance from the Department of Education and/or XXXX  on whether they could start processing XXXX applications for borrowers in XXXX XXXX I stated that according to the Department XXXX XXXX website, https : XXXX, as of XX/XX/XXXX, Borrowers who do not want to be in this forbearance can contact their servicer to change repayment plans. There XXXX still be forbearance associated with changing to certain repayment plans. See below for more information. 
Further, Servicers will also process applications for recalculations for XXXX, XXXX, and XXXX. Servicers will have applications in the queue that will take some time to work through. XXXX for XXXX ( formerly known as XXXX XXXX applications and applications where borrowers checked lowest monthly payment will remain paused. Borrowers should check back here for updates. If servicers need time to process a borrowers XXXX application, servicers will move the borrower into a processing forbearance for up to 60 days. Interest accrues during this short-term processing forbearance, and time in the processing forbearance is eligible for XXXX and XXXX forgiveness. If the borrowers application is not processed by their servicer within 60 days, the borrower will be moved into a general forbearance that does not count toward XXXX or XXXX until their application is processed. Interest will not accrue in this general forbearance. 
The XXXX XXXX XXXXXXXX website clearly states that applications can be processed and that a processing forbearance is permitted. The Dispute Resolution XXXX reiterated they had not received approval from the DXXXX XXXX XXXX  to process an XXXX application for a borrower that is in XXXX fXXXX  The Dispute Resolution XXXX could not point to any information that stated Mohela was justified in this view but continued stating this despite public information put out by the XXXX XXXX XXXX  to the contrary. Mohela is taking an absurd and indefensible position here that hasand continuesto harm me. I am confident that others in a similar position are also being harmed. 
In fact, this position is so outlandish I wouldnt be surprised that they have some sort of monetary gain in refusing to move me out of the XXXXXXXX XXXX  They are, of course, part of the litigation that caused the XXXX plan to be halted and have provided notoriously underwhelming service historically. 
If Mohela can not read and apply simple and straightforward guidance from the XXXX XXXX XXXX to the detriment of borrowers, why are they permitted to service loans? I am extremely dissatisfied with Mohela and believe they are acting in bad faith and unlawfully.

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