Consumer complaint received 2025-02-21 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Problem with customer service
Company: MOHELA
State: TX

Complaint narrative:
I received an email on XX/XX/XXXX and XX/XX/XXXX stating my student loans would be XXXX ( student loan discharge ) because I attended XXXX University XXXX University XXXX Arizona XXXX XXXX for defrauding students. Here is the email sent to me and I will attach it as well. I am trying to figure out why this hasn't been deleted off my credit and not updated on my MOHELA account. Please provide me with an update regarding my concern. 

XX/XX/XXXX Dear XXXX XXXX : Subject : Student Loan XXXX Based on Borrower Defense Evidence The XXXX Department of Education ( XXXX ) has determined that the federal student loan ( XXXX ) you received to attend XXXX University ( XXXX ), now known as the University XXXX XXXX XXXXXXXX XXXX ( XXXX ) on or after XX/XX/XXXX, through XX/XX/XXXX, are eligible for a full discharge. This means the remaining balance on the eligible loan ( XXXX ) will be forgiven. You do not have to make any more payments on the loan ( XXXX ). 

Your loan ( XXXX ) will be XXXX as part of an XXXX action regarding loans made to students attending XXXX between XX/XX/XXXX, through XX/XX/XXXX. This action follows EDs finding that XXXX made pervasive and widespread substantial misrepresentations that borrowers relied on to their detriment and/or violated state consumer protection laws. These misrepresentations are related to licensure eligibility for certain careers, program costs and financial aid, how long a degree would take to obtain, and the transferability of credits. Because of the serious and widespread nature of the misconduct by XXXX, XXXX has determined that it is appropriate to XXXX the loans made to students who attended XXXX. This approach eliminates the need for an individual consideration of each borrowers claim. 

You also may receive a refund for prior payments made to XXXX on the loans that are being XXXX. Your servicer will let you know if you are eligible for a refund, which would be mailed to you or sent electronically. Please check your online account with your loan servicer to ensure your address is correct ( as well as any banking information that is in your account ) so you can receive any refund. Otherwise, you do not have to take any further action to receive your discharge. Your credit report will also be updated to reflect this discharge when it is complete. 

If you do not wish to accept this discharge for any reason, including because you are concerned about any possible state tax liability, please contact your loan servicer within XXXX days of receiving this letter. Dont know who your loan servicer is? Log in to XXXX, find XXXX XXXX, and select View loan servicer details. You also can call us at XXXX and we will connect you with your servicer. 

It will take XXXX some time to process your discharge ; however, you will not need to make additional payments on the loans you received to attend XXXX during the requisite period while your discharge is pending. Until XXXX completes its work, your eligible loan ( XXXX ) from XXXX will remain paused in forbearance/stopped collections, and we will not ask you to resume making payments. If your loan ( XXXX ) are in default, we will not attempt to collect on the loan ( XXXX ) being XXXX. EDs determination is that the loans described above are not enforceable and that you are no longer obligated to repay them. As a result, XXXX will not seek to enforce them, and any future attempts to collect on or enforce your repayment obligations are without legal basis. Furthermore, because the loans described above and your repayment obligations are not enforceable, you are entitled to, and will receive, a XXXX 

XXXX recommends that you retain a copy of this letter for your records. Although your servicer has been instructed that the loan ( XXXX ) that is ( are ) the subject of this notice should not be put into repayment ( unless you have opted out of forbearance or stopped collections ), sometimes loans that XXXX has agreed will be XXXX are erroneously returned to repayment status. In those circumstances, providing a copy of this letter to your servicer could aid you in resolving any dispute about repayment. 

Please note : This letter does not apply to any private student loans you may have. Also, this letter only applies to eligible loan ( XXXX ) you borrowed to attend XXXX during the requisite period ; it does not apply to any loans you may have borrowed to attend any other school.

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