Consumer complaint received 2024-07-24 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: IL

Complaint narrative:
This complaint concerns MOHELA and their inability to apply payments received to the balance of my student loan. 

In XXXX of XXXX, I concluded my XXXX service and was awarded {$4500.00} as part of the XXXX XXXX XXXX. This award can be put toward tuition payments, student loans, and other educational expenses. Here is a timeline of what happened : -XXXX  XXXX XXXX : I sent a request to XXXX to send this full award to MOHELA as a payment on my student loans. 
XXXX XXXX : XXXX issued the payment and sent it to MOHELA XXXX 
XXXX XXXX : I called MOHELA to get a time estimate on how long the payment would take to be applied to my loan balance. They said it would take XXXX weeks. 
XX/XX/XXXX : The payment still not applied to my loan, I called again to ask what had happened to the payment. They told me that I had had the payment sent to a previous MOHELA address as they had recently moved offices. They said not to worry and that once they payment was delivered to the previous address, it would be forwarded to the new one and would be processed as usual. I was then given a time frame of XXXX days for the payment to be received and applied. This seemed excessive for forwarding a letter within the same state, but I waited. 
XXXX XXXX : Nearly 60 days later, the payment had still not been applied. I called MOHELA again and they simply told me they had not received the payment. They said they would launching an inquiry into what occurred and that it would take up to 90 days. I told them to go ahead, but I would try to cancel the payment and send it anew to the correct address. 
XXXX XXXX : I called XXXX to see if they could cancel the payment. They told me it would be done within XXXX weeks. 
XXXX XXXX : XXXX contacted me again saying that they could not cancel the payment without running a check trace on it to make sure it did not get lost in the mail and did in fact reach the recipient ( MOHELA ). I told them to start the check trace, which would also take up to XXXX weeks. 
XXXX XXXX : The check trace from XXXX was returned to me ( which I am attaching ) saying that the check was not only cashed ( " Reconciled '' ), but was done so on XX/XX/XXXX. 
XXXX XXXX : Another call to MOHELA to tell them that the payment had been received according to XXXX. This representative ( who was very kind ) said an escalated inquiry would be launched with priority and to check my loan balance in a week and a half maximum to check for changes. I also sent them a copy of the check trace result from XXXX. 
XXXX XXXX ( today ) : Still no payment applied to the loan balance. I called once again to check what was happening. I was transferred to a supervisor who sent an email to the accounting office with " the highest escalation. '' She told me the payment would be applied to my account in XXXX business days. I am not optimistic. 

It goes without saying that this is unacceptable, whether the payment is applied in XXXX days or not.

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