Consumer complaint received 2024-02-27 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: CT

Complaint narrative:
The short answer is that I paid off all of my Mohela loans in XX/XX/XXXX ( via a refinancing with XXXX ) with the exception of one loan - and the principal paydowns from that transaction have not been applied to the correct loans. I have made numerous phone calls to Mohela and sent numerous written communications via their online portal and have had no resolution in the five months since. Today is XX/XX/XXXX. The proper posting of the principal paydown would mean that all loans were left with a {$0.00} outstanding balance EXCEPT for XXXX # XXXX, because XXXX # XXXX had a below market rate of 5.41 % interest, so I wished to keep that debt with Mohela. 



To make matters worse, in the months of XX/XX/XXXX and XX/XX/XXXX, I have been auto debited {$420.00} and {$410.00}, respectively. These numbers make absolutely no sense. My payment should be less than {$100.00} per month ( roughly {$9000.00} principal before these payments, 10 year amort schedule, 5.41 % interest ). Ideally, I would like to be refunded the overpayment. 



So three asks. 



( XXXX ) Please fix my loan balances, such that Loan 1 / 2 / and 4 reflect {$0.00} balances, and the only outstanding principal on my account remains at XXXX XXXX. 



( XXXX ) Id like to be refunded the overpayment portions of the XXXX and XX/XX/XXXX payments that were auto debited from my bank account. 



( XXXX ) Id like to confirm that I have not been charged any incorrect interest since XX/XX/XXXX. Any interest charged to my account since XX/XX/XXXX should only be based on XXXX XXXX 5.41 % rate. The other loans on my account had higher interest rates, but their balances if treated properly should have been reduced to {$0.00}, so their interest rate should be moot and not be charged to any outstanding balance in my account. 



To review the series of messages that I've sent to Mohela via their online Messages function, see below. Many thanks in advance for any assistance you can provide. 



===== XX/XX/XXXX There seems to be some confusion about how the large payment ( ~ $ XXXX ) should be posted to my account. I say this because I have checked my Mohela balances on three ( 3 ) different occasions and seen different balances associated with difference loan numbers each time. Let me clarify how this should be done. All of my loans should now have a balance of {$0.00} with the lone exception of loan XXXX. Loan XXXX is the only loan that should still have any outstanding balance. Loans XXXX, XXXX, XXXX, and XXXX should be the loans that receive their allocations of the recent ~ $ XXXX pay down. These loans were refinanced with XXXX. I did not include Loan XXXX in this refinancing because it is the XXXX loan in my portfolio of Mohela loans with an interest rate below the current market rate that I was able to obtain with XXXX. In the month prior to this refinancing, I paid off loans # XXXX and # XXXX from my own savings. I repeat. All payments from the recent large pay down should be applied to loan # XXXX XXXX, XXXX, XXXX, and XXXX. These loans should now have a {$0.00} balance outstanding. The only loan in Mohela account that should continue to have an outstanding loan balance is loan # XXXX, which has an interest rate of 5.41 %. Please confirm receipt of this message. Thank you. 



===== XX/XX/XXXX The {$9000.00} payment as of XX/XX/XXXX that was posted to XXXX # XXXX is INCORRECT. This amount should have been applied to XXXX # XXXX, NOT XXXX # XXXX. Allocating the payment correctly to XXXX # XXXX will bring the {$8500.00} balance that is currently being reflected to {$0.00}. Any $ amount that is left over after paying off XXXX # XXXX can then be applied to XXXX # XXXX. The only loan in my portfolio that should continue to have any outstanding balance is XXXX # XXXX. Please correct this issue as soon as possible. I have called multiple times without this issue being resolved so I'm attempting to contact via Messages. 

===== XX/XX/XXXX Why are my loan balances all wrong? My loan details are showing the following Current Principals : XXXX : $ XXXX, XXXX {$1900.00}, XXXX {$10.00}, XXXX {$19000.00}, XXXX $ XXXX. These are all incorrect. The aggregate of these balances is {$9100.00}. The correct record is very simple. The Current Principal for XXXX should be : {$9100.00}. Every other loan should reflect a Current Principal of {$0.00}. My account is also saying that my next payment due date is not until XX/XX/XXXX, which doesn't make any sense. I should be paying every month on XXXX 's {$9100.00} Current Principal. Please advise when I can expect the the system to be updated. Do not respond by saying that your records indicate that I have spoken to a representative and the matter is considered resolved. I have spoken to multiple representatives and the balances are still incorrect. This matter is NOT resolved. Please direct this message to someone who will correct the balances. Thank you for your time and assistance.

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