Consumer complaint received 2025-07-11 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Problem with customer service
Company: Servicer under contract with Federal Student Aid
State: MO

Complaint narrative:
In XXXX the department of education announced a one-time payment count adjustment during which consolidated loans would be credited with the better payment history of the underlying loans. As my two student loans have differing payment histories, with one in default while the other was in repayment, I would very much benefit from this. I consolidated my loans for the benefit as per dept guidance and have waited ever since, yet the change was never applied to my account. 

I contacted the department of education 's Federal Student Aid office, my loan servicer, the department 's default resolution group each numerous times to no avail. Each entity either deferred to another, or told me to give it time. I am currently pursuing public service loan forgiveness, with an official count of XXXX out of XXXX required payments. If the adjustment had been applied to my account, I would have more than met the XXXX threshold. I was told to submit feedback - I did, and it was closed without resolution. I was told to submit a reconsideration request. I did XX/XX/XXXX and have been given no update other than alternating " it has been escalated '' " it is in final review '' " it's being worked on. '' The point of the payment count adjustment was to address the now widely recognized chronic failures on behalf of the department and contracted federal loan servicers to properly track and manage the federal loan portfolios. I experienced this failure firsthand by my former servicer, XXXX. 

The company 's mismanagement and record of failures is well documented and they no longer have a contract with the department. They improperly defaulted my loans after I requested deferment and when I called to find out what happened I was told it was an error on behalf of XXXX but that once the loans are transferred to the default resolution group, they have no hand in the matter and there was nothing I could do. During this period of default my income tax refunds were intercepted and applied to my loans. After the last offset in XXXX I received a letter from Default Resolution Group stating that offset had resulted in overpayment and I was due a refund. As I only had 2 loans each with an original principle balance of {$2600.00}, and had paid at least that, this seemed feasible to me. Yet I not only never got a refund, I got a statement with a balance due. I have asked all parties involved for an explanation, yet have gotten none. 

I do not deny or dispute the initial period of default in my loan history, that began after XX/XX/XXXX. That was entirely my fault, I lost XXXX loved ones in the towers that day and went off the rails for awhile. But the period of default in XXXX, I dispute and have documentation from XXXX which I submitted to the department of education in my request to have my payment count reconsidered. A group called XXXX and XXXX, who was my point of contact for a period, confirmed what XXXX told me about the deferment not being applied and that once the loans have changed hands, it can't be undone. 

I would not have followed department guidance on consolidating my loans for the payment count adjustment if I'd known it wouldn't be applied to my account. In consolidating I lost the ability to use an option of " buying back '' months of forbearance. However, consolidation can not be undone. 

In summary, I am seeking application of the payment count adjustment to my account or, if not, an explanation as to why it can not be, especially given that I have made a strong case for servicer remediation. I would also like an explanation for the DRG letter stating the offset tax return overpaid my debt yet I'm still paying. I am concerned that time is of the essence in resolving my issues because with so many changes on the horizon, I am concerned the PSLF program will end or requirements will become restrictive to the point I no longer qualify.

Company response to consumer: Untimely response