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FEDLoan reported a miss payment - what can I do

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FEDLoan reported a miss payment - what can I do

Long story short, I completed student loan rehab, and per the agreement I had to pay 3 payments of $68 dollars then my rate would change to the standard repayment. I made the first 2 payments but then my third payment showed me owing over $500. It took me 3ish months of calling to finally have a competent person to contact the correct department to finally find out it was a billing issue that they were having a hard time fixing(for whatever reason) so they said to fix they would basically do a deferment and move that payment and the 3 payments that I hadn’t paid yet trying to get this fixed, to the end of the term and start the normal payments the next month.

Well then they reported the $500 payment as a missed payment on my report. After calling them probably a dozen times now I keep getting the same response of needing to fill out a credit challenge and fax it to their credit reporting department which I’ve done 3 times now. And nothing ever changes and no one ever gives me a reason. I’ve even tried challenging it through TU and EQ and EX and they just report it as correct.

I’m at a list of what to do. It’s showing as a missed payment on 10 student loan accounts and it’s killing my reports. Any help or insight would be tremendous and appreciated beyond all.
Message 1 of 6
5 REPLIES 5
Valued Contributor

Re: FEDLoan reported a miss payment - what can I do

To my knowledge, once you're done with rehab, the loan is picked up by a servicer and you're put on a payment plan. Most people who have defaulted will benefit most from an Income-driven repayment (IDR) plan such as IBR or REPAYE to keep the payments manageable.
I'm not quite understanding why you have to make these 3 reduced payments to go on a standard repayment plan. I'm not familiar with this. The only process I know where you might have to make these kinds of payments is to consolidate to get out of default. Can you explain this process in more detail please?
As for payment plans, have you looked at the income-driven repayment plans? It might give you added flexibility that standard does not and there is nothing against you paying more than the minimum. Unless you're making a ridiculous amount of money your payments shouldn't be $500.
Are you with the servicer or the collection agency?

If the late is inaccurate the first thing I would do is to get the proof. Any paperwork that you can produce or request that says you were on deferment should work. Since they are giving you the run-around, I'd submit a dispute directly with the credit bureaus. When it asks for supporting information you can give them the deferment paperwork. You can do this online.
Other than the late, it sounds like your account really needs to be corrected and finalized. The people you're working with don't sound like they're doing much of anything. I would additionally submit a complaint with the official Student Loan Ombudsman (on the gov website). People have mixed results with that. If that doesn't work I would definitely file a complaint with the Consumer Financial Protection Bureau, or CFPB. I've had a lot of success with that. You'll need to get all your information together (bills, email and mail communications, call log, etc) so you can upload it. Call the loan people and request it if you don't have it. I would break it up into multiple phone calls; I get better results that way.
This process might take a while but it'll be worth it for the score improvement.



Message 2 of 6
New Member

Re: FEDLoan reported a miss payment - what can I do

The loan was picked up by fedloan after the rehab. The repayment plan they had setup after the rehab was 3 payments of $63 to “ease” into the normal payment of $117. Well somehow their system messed up and set my third payment as owing a little over 500$. It was a mistake which I finally got someone to admit, and their solution was to put the account in forbearance and pick up the payments later. But they still reported that I missed that payment and I can’t get anyone to fix it
Message 3 of 6
Community Leader
Senior Contributor

Re: FEDLoan reported a miss payment - what can I do

I know this isn't going to be a popular answer but, while they may have messed up the amount, if you didn't make the payment you did technically miss it.
Current Scores: EQ 679;TU 647; EX 679 Gardening since 11/7/18
Beginning Scores-- EQ 632; TU 576; EX 619 FICO 08 (06/13/16) - BK7 discharged 11/2015
Message 4 of 6
Member

Re: FEDLoan reported a miss payment - what can I do

I’m lost, too.  Rehab requires nine consecutive on time payments; consolidation takes six.

 

Exactly when did the demand for the $500 kick in?

 

If the servicer screwed up, and they do, you have a court of last resort.  File a complaint with the Consumer Financial Protection Bureau.  They have oversight over student loan servicers.  I had to go to them once and they got action.  Fast.

Message 5 of 6
Valued Contributor

Re: FEDLoan reported a miss payment - what can I do

Unfortunately, this is why many people have FLS draw from a bank account that only has those payments in it or don't allow autopay. Sadly they are known for not always drawing the correct amount from accounts.
The correct solution was to return the excess funds to your checking account. If a partial refund was possible they needed to return all of it and initiate a new payment. No part of any solution should end with you being reported late. You made the payment on time and cannot be held accountable for errors that are 100% on their end.
An account specialist can make these adjustments and a copy can be requested to be sent to you in writing.
Instead my understanding is they took the easiest, laziest way out. It sounds reasonable, the forbearance... But FLS had a tendency to leave details out. Like of the excess will go to the principal or the interest? They won't be counted as IDR payments towards forgiveness. And that when they make manual adjustments like this they usually Cascade onto bigger problems. In my case, a manual adjustment almost sent me into default (my payments stopped applying to my account altogether even though they were taking them). What kind of forbearance did they put you on and will interest accrue? If so, at the end will it be capitalized to the principal?

My first step would be getting on the phone to get a copy of everything that they did. Download a PDF of the NSLDS data and of all your bills with your servicer. Make a PDF of any email or message inbox communications. Next you should try to have it resolved by an account specialist. Skip help from the first person that answers your call. Either the account specialist will fix it right then or the logs you've just created (who did you talk to, time, date, summary of conversation, etc) will help you later.
As I described above, you first go to the Ombudsman. Then you go to CFPB. CFPB has no actual authority; they have recently been detoothed. However many servicers are still wary of the threat they pose. They are just a middleman in the complaint because it all helps create a database. It just provides a direct, documented link to your servicer imo prompting a more appropriate response than when you try to call them up.

The other think I want to come back to is that to my knowledge, there is no such thing as payments to ease you into normal payments. If your income is low enough you will just qualify for lower payments. Please check to make sure you're in an IDR (Income-driven repayment) plan of you need the lower payments. If you plug your income into the repayment estimator while you're signed in it should easily tell you what your payments will be in each plan.
Good luck.



Message 6 of 6
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