Student Loan Assistance Programs

Is Mentor USA Really a FedLoan Servicing Contractor?

Written by Steve Rhode


Dear Steve,

I read your post from a couple of years ago about Mentor USA. I’ve been dealing with them for a few years and realized last year that something was shady. For years, they act as a “contractor” of FedLoan Servicing (my loan provider) and the Dept of Ed. They have called themselves, in those exact words, as much during a recent phone call.

They reached out to me in 2016 as soon as I enrolled in the Public Service Loan forgiveness program. They’ve been collecting $38 a month from me ever since. Last year I got the sense that something was fishy so I stopped paying them. I have since switched careers and have re-certified for an income driven repayment plan with FedLoan and without Mentor’s help. Then they contacted me asking me to re-certify with them. I have been on the phone with them a few times and they continue to call themselves a “contractor” of FedLoan Servicing.

I spoke with some managers at FedLoan and they gave me the rundown of how mentor operates and what they are charging me for. I have been in contact with mentor allowing them to believe that I am going to re-certify.

What I want to know is if they say they are a contractor, or payed by FedLoan or the Dept. of Ed or that the $38 payments go toward my student loan balance, are they legally liable in any way? This seems fraudulent.

I would like nothing more than to get these people on the phone and give them a fond farewell before never speaking to them again, but since they have access to all of my personal information, including pay stubs, tax info, social security, I want to know what I am dealing with and what repercussions I could face were I to simply cut them off for good.



Dear Zachary,

Just to be clear, no student loan assistance company is a “contractor” of any federal student loan servicer or the Department of Education, even though some say they are.

READ  Did I Get Scammed by Mentor USA?

Keep in minds that nobody is “enrolled” in Public Service Loan Forgiveness (PSLF). You can’t qualify for forgiveness until you have met all of the criteria. Even the employment certification form can’t be relied on, says the Department of Education. While you are making payments in hopes of eventually being eligible for loan forgiveness from PSLF, you are not enrolled.

You can be enrolled in an Income-Driven Repayment (IDR) plan and still be eligible for potential forgiveness under PSLF. Just make sure your payments you are making under IDR are eligible. You can check here.

If you do decide to part ways, I would be surprised if they did anything illegal with your information out of retribution. And that fear is hardly a wonderful reason to hang around with any company if you are not satisfied with the services received. Otherwise, you are a hostage and not a valued customer.

To maintain your IDR status you will have to recertify each year. It’s up to you if you want to pay someone to deal with that on your behalf or not.

If you do decide to part ways with any student loan assistance company, contact your loan servicer and absolutely confirm they have your actual mailing address, telephone number, and email address. Some companies change consumer contact information and you might get the notifications you need.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.


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