FedLoan Servicing was accused of neglecting to properly conduct the handling of the student loans in their care. If you need to flag this entry as abusive. Mail: FedLoan Servicing P.O. FedLoan Servicing and PHEAA have been the subject of widespread criticism and multiple lawsuits due to allegedly poor student loan servicing … Where I live, what kind of income I make and then I had to fill out paperwork with my HR department,” Grier said. “These federal programs allow Americans from all backgrounds to dedicate their careers to serving others. Report possible fraud and put a freeze on your credit. Today is National Voter Registration Day! “They had changed everything: my user name, my password, my email. While the CFPB has identified Grier as a victim of the scam it is not clear if she will get her money back. They had my address as an abandoned warehouse in Tustin, California. “They asked for normal information. Support You Can Trust. I realized these people had my social security, they had my bank account, they had everything,” she said. This is the type of case the Consumer Financial Protection Bureau (CFPB) is perfect for but right now conservative voices are shouting for the CFPB to be shuttered. The lawsuit, filed in U.S. District Court for the Southern District of New York, seeks restitution for state residents it says were harmed by the loan servicer … Some people wonder whether or not FedLoan Servicing is a legitimate servicer. Now the Massachusetts Attorney General is saying the FedLoan Servicing mess is even larger. Grier, a registered nurse, applied for a student loan debt relief program with an online company claiming to “guide you through the steps necessary to apply and qualify for benefits with the U.S Department of Education.”. It’s nice to see someone trying to clean up this mess but as of now only residents of Massachusetts may benefit from the suit. The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against the company for deceptive and unlawful practices. We made it easy for you to exercise your right to vote! ©2020 Verizon Media. Rather than fulfill its responsibilities to these borrowers, FedLoan Servicing has instead prevented student borrowers from making qualifying monthly payments that count towards loan forgiveness, shifting the consequences of its loan servicing failures onto the student borrowers themselves. She tried to contact SL Account Management but the number was disconnected and no one returned her emails. “I was recently involved in a scam from SL Account Management, which is a company that said they were with the Department of Education,” Grier said. Feds Requires Income-Driven Repayment for Loan Forgiveness Learn about FedLoan's PSLF Service. The lawsuit alleges widespread loan servicing problems that have harmed thousands of borrowers. What this means is that they take care of all the servicing and customer service stuff for the loans - like processing payments, sending statements, handling questions and concerns, and more. Why Are They Being Sued: They are being sued for very similar reasons as the Navient lawsuit. FedLoan Servicing Complaints. The agency reported in 2014 that it serviced a total of $287 billion worth of loans. The Better Business Bureau does not accept complaints for government agencies, this includes FedLoan Servicing. Unfortunately, consumers are providing their personal information and entering into contracts with these companies, typically under false promises of loan forgiveness programs and lower loan payments.”. The top student loan official from the Consumer Financial Protection Bureau cited “ detours and dead-ends ” when it came to keeping payments affordable. And guess who is left holding the bag here, the individual consumer since the Department of Education says FedLoan Servicing is making mistakes they don’t have to stand behind. PHEAA sends out news releases warning consumers of scams twice a year, also offering tips to identify possible scams. But the PSLF and TEACH Grant program (Under the TEACH Grant program, students receive up to $4,000 per year to help pay for the education required to pursue a teaching career) are not the only allegations of poor performance. “The {CFPB} froze the bank accounts of 23 different names that they have and it’s over 40 million dollars,” Grier said. Which is really unfortunate,” she said. Some people have waited six months or more for decisions on these programs. The CFPB has set up a notice for consumers who may have been affected by the scam. FedLoan has been accused of mismanaging their responsibilities for servicing the debt of everyone enrolled in the … All rights reserved. The complaint filed by the Attorney General alleges FedLoan Servicing can’t get the Income Driven Repayment (IDR) programs straight either. • Contact your financial institution: If you have provided your banking information (credit card/debit card, bank account), contact your bank to prevent fraudulent charges. My office will protect PSLF and hold PHEAA accountable for forcing these students further into debt.”. New says PHEAA continues to work with the CFPB and PA State Attorney General’s Office regarding the scam. 08/25/2017 11:51 am ET. The Government goes on to assert even if FedLoan Servicing gives credit towards forgiveness it doesn’t matter as only the Department of Education can make that determination. 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