FedLoan and Military Repayment Program

Anonymous · ‎05-04-2016

Ive asked this questions a few different places and never really get an answer. I will make this short and simple. In 2012 I had reenlisted while over in afghanistan for another 6 years of service and in my contract I was given the benefit of the Student Loan Repayment Program. I was told by my supervisor to keep paying for the loans until I make sure they are getting money from the government than I dont have to worry about it. So thats what I did. I kept current for a couple years due to them having system issues and not paying it (government likes keeping thier money). I finally recieved word they paid in 2014 so I stopped paying.

I found out in late 2015 when I started to pull my credit reports that they were reporting 120+ late. I never recieved a phone call, I never recieved an email, nothing. I have 6 months of 120+ lates on my FedLoans, and I have 4 of them. You do the math. This alone is killing my credit report. If I can get these taken care of somehow I will be in a hell of alot better shape. These loans are from 2008 and didnt start reporting late until 2014 so I would have to wait antoher 5 years for them to automatically drop off.

Does anyone know if there is a possibliity they will removed these lates due to the military program I am in? I have paperwork showing they were paid by the government in 2013, 2014, and 2015. I have the funds to pay all 4 of these off in full if they will do a PFD on the lates, that is an option too. I just dont know which route to take. Any help is much appreciated.

THank You,

SCF · ‎05-04-2016

Are you still in the service? I would start on the military side. Explain that you were penalized because of an issue you didn't cause, see if whoever makes the requests/signs people up/etc. can pull your records and get in touch with the servicer and sort it out. If that's no good (for whatever reason), get as much detailed paperwork as you can and take it over to the Student Loan Ombudsman or the Consumer Finance Protection Bureau with your complaint.

If that still doesn't work, call your congressman. They aren't always useful, but they certainly don't want an angry servicemember calling up the local news over the inability of the government to talk to itself which screwed you over while you were serving overseas. Plus, they'll want to take credit for helping you out, so it's like a carrot and a stick all in one.

The CFPB has been on servicers about not handling servicemember benefits properly in the past couple years. It's definitely a pain point, so just be firm and clear that this shouldn't have happened to you and keep pushing and I'm sure you'll find someone to sort out the mess.

Anonymous · ‎05-04-2016

@SCF wrote:
Are you still in the service? I would start on the military side. Explain that you were penalized because of an issue you didn't cause, see if whoever makes the requests/signs people up/etc. can pull your records and get in touch with the servicer and sort it out. If that's no good (for whatever reason), get as much detailed paperwork as you can and take it over to the Student Loan Ombudsman or the Consumer Finance Protection Bureau with your complaint.

If that still doesn't work, call your congressman. They aren't always useful, but they certainly don't want an angry servicemember calling up the local news over the inability of the government to talk to itself which screwed you over while you were serving overseas. Plus, they'll want to take credit for helping you out, so it's like a carrot and a stick all in one.

The CFPB has been on servicers about not handling servicemember benefits properly in the past couple years. It's definitely a pain point, so just be firm and clear that this shouldn't have happened to you and keep pushing and I'm sure you'll find someone to sort out the mess.

The problem is that I technically did cause it. I did not read the fine print that said I needed a deferment even if they were paying for it. I just stopped making payments since they were getting paid by the government. I was not deployed at the time of the missed payments, I had been home about 2 years at that point.

I will contact FedLoan Directly tomrorow and talk to a couple people there and see what kinda vibe I can get from them and see if I need to talk with ombudsman or not. I did contact a military source tonight and they suggested I talk to the company directly and that they will usually help out if there have been mistakes made.