MOHELA – CFPB Complaint 2018-04-17

Date Received: 2018-04-17

Product: Federal student loan debt

Issue: False statements or representation

Consumer Consent Provided to Share Complaint: Consent provided

Consumer Complaint: In XX/XX/XXXXand XX/XX/XXXX I took out two federal parent student loans for my son ‘s education. Each loan was about {$25000.00}. I began making payments immediately at the level Mohela suggested was a minimum payment. I did this for many years. I finally realized the payments were never enough to cover the interest of the loan. Mohela never told me that. When I contacted them, they said I could bring the loan into a re amortized type of situation and make a fixed payment for 15 years and pay the loan off. I recently fond out that none of my new payment was being applied to principal and in fact didn’t even cover the interest.

So now after over 10 years of payments, I owe more than the original loan amount. My payments began at the {$350.00} per month level and increaswed up to over {$550.00} per month but not one penny has been applied to principal. I was very much mislead by Mohela to my determent and their great financial advantage.

Company: MOHELA

State/Zip: AZ 853XX

Company Response to Complaint: Closed with explanation

Was Company Response Timely: Yes

Did Consumer Dispute Company Response: N/A

Complaint ID: 2878463

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See also  ERC - CFPB Complaint ID 2633842