Consumer complaint received 2025-01-29 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Problem with customer service
Company: MOHELA
State: AZ

Complaint narrative:
In early to midXXXX XXXX, information from DoE and MOHELA was distributed that other repayment programs eligible for PSLF would be available if a borrower wanted to leave the SAVE program in order to begin repayment.

" Borrowers may apply for IDR plans and/or to consolidate loans by using the online applications for Income-Driven Repayment ( IDR ) Plan Application Alternatively, borrowers continue to have the option of submitting a paper application by downloading and printing a PDF form.

Borrowers may apply for different income-driven repayment ( IDR ) plans depending on their individual circumstances. We encourage borrowers to review the specifics of each IDR plan in order to make the best choices for their circumstances. For example, if a borrower enrolls in an IBR Plan and then moves to a different repayment plan, accrued and unpaid interest will capitalize ( be added to the principal balance ). 

Borrowers are still permitted to apply for IDR plans, including SAVE ( previously known as REPAYE ), even though the court has enjoined some of the SAVE and other IDR plan provisions, including forgiveness. The terms of the SAVE Plan and other IDR plans are subject to the outcome of ongoing litigation.

A summary of each plans current application and enrollment availability is as follows : SAVE ( previously known as REPAYE ) : Can apply ; will be placed in forbearance Income-Based Repayment ( IBR ) : Can apply Income-Contingent Repayment ( ICR ) : Can apply. Note : Borrowers who have Direct Consolidation Loans that repaid PLUS loans made to parents can apply only for the ICR Plan Pay As You Earn ( PAYE ) : Can apply Servicers have begun processing certain IDR applications that were paused following court orders affecting the terms and availability of IDR plans.

Specifically, processing has resumed for borrowers applications to enroll in the IBR, ICR, and PAYE Plans. Servicers are also processing recalculations and recertifications for IBR, ICR, and PAYE. Servicers will have applications in the queue that will take some time to work through. Processing for SAVE ( formerly known as REPAYE ) applications and applications where borrowers selected lowest monthly payment will remain paused. Borrowers should check back to this page for future updates. '' On XX/XX/XXXX, I submitted an application for IBR via XXXX and because I could not figure out which plan was best for me, selected the option to allow the servicer to select a plan. Nothing happened. The application was still under review. Then information came out that the IDRs would be processed beginning XX/XX/XXXX. In effect, for two months, an application that was properly submitted, MOHELA did nothing with. On Monday, XX/XX/XXXX, I emailed MOHELA to check the status of this XXXXBR application but decided to call on Tuesday, XX/XX/XXXX. I sat on hold for 1 hour 39 minutes and 27 seconds waiting for a representative. I was able to speak with XXXX and when asked what the status of the IBR application was that was submitted XX/XX/XXXX, he advised, they only " recently '' began reviewing applications. When I asked what " recently '' meant, he advised he could not provide a specific date, but " last week. '' When I asked why nothing was processed until " last week, '' he could not provide an explanation. When I stated that it feels as though MOHELA does not care about its customers, he replied that MOHELA does. When I asked him to explain how it is that MOHELA cares, he could not provide an explanation. 

I understand a company does not need to care about its customers. However, it seems to me that it is good overall business practice for a company to in fact care about its customers, to accurately provide information, to timely process applications, and to understand that as a customer, I actually DO want to pay my student loan. The longer I sit in this general forbearance that is ineligible for PSLF credit, the longer I am indebted to the DoE. I know that I am not alone in wanting to pay my student loans and wanting this weight of owing what is essentially a house that I will never live in to be paid off so that one day, I may actually own a house I can live in.

I am frustrated with MOHELAs lack of transparency as to the reasoning for NOT processing applications for IBR for over three months. I am frustrated with MOHELA not taking any appropriate action and processing the applications when submitted. I can not think of a single business where failing to process applications would not be actionable. At the very least, MOHELA could have acknowledged receipt of the IBR application and provided information that they would not be processing or to advise when they began processing. 

I fully understand how a new presidential administration can impact the student loans and the DoE. However, the failure to process applications prior to the elections in XX/XX/XXXX is unacceptable. The failure to process applications beginning in XX/XX/XXXX, when DoE provided information/guidance that servicers would begin processing applications and MOHELAs decision to not comply with this and the failure to communicate why it was not processing applications is unacceptable. MOHELA is keeping me unnecessarily on hold and from making payments that would in fact qualify for PSLF as guaranteed in the Master Promissory notes of ALL of my student loans, so long as I am employed by an employer who qualifies.

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