Consumer complaint received 2026-04-02 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Struggling to repay your loan — Problem with your payment plan
Company: MOHELA
State: NY

Complaint narrative:
I am submitting a formal complaint regarding the servicing of my federal student loans by MOHELA. This complaint reflects a pattern of servicing errors that have impacted my repayment status, loan balance accuracy, and eligibility for federal repayment and forgiveness programs. The issues described below are not isolated incidents but instead demonstrate ongoing mismanagement across multiple aspects of my account. I was actively enrolled in graduate school until my graduation date of XX/XX/XXXX. Despite this, my loans were placed into repayment on XX/XX/XXXX, prior to my graduation. At that time, my loans should have remained in in-school deferment. This represents an improper transition into repayment status while I was still enrolled. In response to this error, I applied for deferment ; however, this request was denied on XX/XX/XXXX, even though I remained actively enrolled. As a result, I was left in an incorrect repayment status through no fault of my own. A late payment was subsequently reported on XX/XX/XXXX. Given that repayment should not have been active during this period, this late payment appears to be invalid and may have negatively impacted my credit. My in-school deferment was not properly approved until XX/XX/XXXX, several months after it should have been applied. This delay confirms that my account was not being managed in accordance with my actual enrollment status. Additionally, I received conflicting forbearance determinations covering the same timeframe. On or around XX/XX/XXXX, I received both an approval and a denial for a forbearance period listed as XX/XX/XXXX through XX/XX/XXXX, which is internally inconsistent and raises serious concerns regarding the accuracy of account processing. A separate forbearance related to employment hardship was later approved on XX/XX/XXXX ; however, the documentation associated with this approval contains conflicting and illogical date ranges. I have been enrolled in an income-driven repayment plan since XXXX and have reapplied as required. My income-driven repayment plan was approved again on XX/XX/XXXX. Despite these approvals, my loans are currently placed under a XXXX XXXX XXXX, and my approved income-driven repayment plan has not been implemented. Based on my financial situation at the time, my calculated payment under an income-driven repayment plan would have been XXXX dollars. These zero-dollar payments still qualify as valid payments under federal guidelines and should have been reflected accordingly. I am also enrolled in the XXXX XXXX XXXX XXXX program. Because my approved income-driven repayment plan has not been applied, my qualifying payment count appears to be inaccurate. I am currently only receiving credit for a limited number of payments, despite periods in which I should have been receiving qualifying credit, including months in which my payment would have been XXXX dollars under my approved repayment plan. I have also received communication indicating that additional payments may qualify if my account were properly placed under an income-driven repayment plan, which further confirms that my current payment count is incorrect. I consolidated my loans based on federal guidance issued during the administration of Joe Biden in order to maintain or access eligibility for income-driven repayment plans. I completed all required applications in good faith and in reliance on that guidance. Despite this, my account has not been managed in accordance with the repayment structure I applied for and was approved to receive. There are also significant discrepancies in the reported balance of my loans that require immediate investigation. My expected principal balance is approximately {$220000.00}. However, my account currently reflects a balance of approximately {$270000.00} total with about {$40000.00} in interest, which does not align with expected calculations based on my loan terms, even when applying higher-end interest rates. Additionally, there is a loan listed in the amount of approximately {$5500.00} that is labeled as a Direct Consolidation loan provider rather than being associated with my original institution. This amount appears to also be included within my consolidated loan balance, raising concerns that it XXXX be duplicated or improperly retained following consolidation. These discrepancies are reflected both with MOHELA and within XXXX XXXX XXXX, indicating that this is not a simple display issue but a broader systemic problem. I have also been unable to submit a loan discharge application through XXXX XXXX XXXX due to persistent system errors that have continued for several months. This has prevented me from accessing federal relief programs and has further compounded the impact of the servicing issues described above. Taken together, these issues demonstrate a pattern of servicing failures, including improper activation of repayment prior to graduation, delayed and incorrect application of in-school deferment, inaccurate reporting of a late payment, failure to implement an approved income-driven repayment plan, inaccurate tracking of qualifying payments under XXXX, and discrepancies XXXX loan balance calculations that may include duplication or improper accounting of loan amounts. These failures have directly impacted my financial standing, my access to federal repayment protections, and my progress toward loan forgiveness.

Company response to consumer: Untimely response