Every month, your loan servicer takes a chunk of change from your bank account. Loan servicers having clear and consistent communication probably seems like a rule. Unfortunately, if your loans are housed with American Education Services (AES), this isn’t the reported experience from borrowers.
Student Loan Planner conducted a survey in 2018 asking readers about their experiences with student loan servicers. AES was at the top of the list for being a communication nightmare. The Consumer Financial Protection Bureau (CFPB) and Consumer Affairs have similar reports for AES.
About American Education Services
AES is housed on aessuccess.org. It was established by a much larger company, the Pennsylvania Higher Education Assistance Agency (PHEAA).
It was created to house the Federal Family Education Loan (FFEL) Program for PHEAA. These loans are no longer distributed, but many individuals are still working to pay them off.
AES now houses FFEL loans, federal student loans and private, or alternative, student loans. PHEAA also owns and operates FedLoan Servicing along with college resources You Can Deal with It and Education Planner.org. In communications from AES, student loan borrowers are sometimes sent to one of these websites for information.
What does American Education Services do?
AES isn’t a lender; it’s a loan servicer. Its job is only to manage loans. Examples of services include:
- Processing student loan payments
- Offering support and guidance for federal loan repayment programs
- Maintaining communication about loan options and the status of the loan
- Determining availability of deferment or forbearance
The loan servicer acts as the middle-man between you and the lender. This essential role requires borrower service and care to be at the forefront.
Major complaints about American Education Services
AES handles your money and expectations should be held high. The complaints about AES all generally circle around communication and processing payments. Below are major issues that continually pop up with AES.
Inconsistent communication and advice
The communication complaints are plentiful with AES. When information is false or missing, this leads to difficult situations for borrowers.
One consumer reported that they called in once a month for a full year waiting for an account review result. Even after the account review was complete, they never received any explanation or reasoning behind decisions.
If you do get an explanation, the answer could be wrong or different every time. Borrowers who reported with Consumer Affairs stated they often got different answers from each person they spoke with. Borrowers have had to double down when talking to AES and check their facts due to communication inefficiency.
Paperwork is a constant chore
Every loan servicer requires certain paperwork. This is especially true when applying or recertifying for a repayment program. Borrowers with AES have constant issues with paperwork being denied or rejected.
One of our survey participants stated, “Every year I have to recertify for the Income-Based Repayment (IBR) option. Every year the DoE [Department of Education] sends an email when it’s time to complete it. Every other servicer processes accordingly. But AES rejects the application every year for some arbitrary reason and then demands I complete the application again. It’s obnoxious the amount of extra work they require because they just can’t seem to get it together.”
Many borrowers appreciate the ability to upload documents rather than send them in via snail mail. But the rejections being reported aren’t always valid.
Payments not applied properly
Poor billing and payment communication channels are a third major complaint about AES. The Better Business Bureau (BBB) houses many borrower complaints about payments not being applied properly. Consumer Affairs and the CFPB follow suit with the same issue being reported.
The BBB reports on more than one occasion that payments were deducted from borrowers’ accounts and not applied to the student loan. They were then called multiple times a day for ‘late payments.’ In other scenarios, payments were made over the phone. A few days later, the money was transferred back to the borrower bank account.
Missing payments directly affects a borrower’s financial health. Serious consequences, like a drop in credit score, are long-lasting. The other complaints are frustrating, but this one is inexcusable.
Long waiting periods to process documents
Lastly, a major complaint regarding AES is processing time for documents and applications.
According to a survey participant, “[AES] automated forms, statements and account changes are terrible, usually delayed, and can take multiple calls to resolve issues.” This individual would get notifications two to three months after changes went into effect.
No one wants to spend hours of time on the phone or sending paperwork back and forth for months. Changes shouldn’t take effect prior to your notification, either. You need to take some precautions if AES is your servicer.
How can you be proactive when American Education Services houses your student loans?
Overall, there’s a lack of resolution to borrowers’ problems. This stems from the underlying communication issues mentioned above. With any loan servicer, keep track of communications and requirements. This is essential to make sure you’re well-represented in every scenario.
Try to put in place these best practices when dealing with AES:
- Ask who you’re talking to and write down their name
- Keep records of all documents, including anything you scan in
- Check to ensure you’re paying each month on time
- Be diligent about reaching out with questions
- Look over your monthly statement regularly
- Check your credit report consistently
- Review your loan status online using the NSLDS portal
But even after taking all precautions, you may be to a point where you’re considering a new loan servicer.
What are your options for leaving American Education Services?
Dealing with a difficult loan servicer is about as fun as stepping on a Lego. Chances are, you didn’t even choose AES to service your loans. Student loans were either sold to AES or assigned to AES by the government. Wanting a new servicer is a reasonable request, but it has strings attached.
The federal government can transfer your loan to another servicer — but not by your personal request. It will do this at its own discretion for its own reasons.
The only way to leave a federal student loan servicer is to refinance or consolidate your student loans. Both of these choices will change your loan terms. Options for repayment plans and forgiveness may go away. You’ll want to research both of these before making the leap to leave AES.