Do you have a student loan serviced by MOHELA? If so, pay attention to how your loan is being serviced. MOHELA has fewer negative reviews than other loan servicer complaints. However, there are common complaints that could cause you heartache in the future.
Here’s what you need to know.
What is MOHELA?
MOHELA is an acronym for the Missouri Higher Education Loan Authority. MOHELA is one of the largest nonprofit loan servicers in the United States. It was originally formed in 1981 to service loans from the Federal Family Education Loan (FFEL) Program. Now it services both federal and private student loans.
4 top MOHELA complaints from borrowers
In our 2018 refinancing survey, we surveyed our readers on their experiences with student loan servicers. Out of the 385 respondents, only seven people had loans serviced by MOHELA.
However, there are hundreds of MOHELA borrower complaints online, most of which fall under the four following situations.
1. PSLF issues
Many borrowers with loans serviced by MOHELA pursued Public Service Loan Forgiveness (PSLF). The PSLF program is confusing for borrowers because of its stipulations. You need to stay on top of your progress to make sure you’re making qualifying payments properly.
Most MOHELA complaints deal with its lack of understanding about PSLF. Borrowers are receiving bad information. One borrower shared that she contacted MOHELA about setting herself up to qualify for PSLF. Years later, she found out that none of her loan payments qualified and she didn’t turn in the correct paperwork. She received different information every time she spoke with a MOHELA customer service rep.
Another borrower made several phone calls to MOHELA, specifically requesting to be put on a PSLF-qualifying loan payment plan. The loan was eventually transferred to another loan servicer. The borrower found out that MOHELA set up the payments improperly. None of the payments counted towards PSLF. The borrower estimated that MOHELA’s mistake cost them over $3,500 in extra payments.
2. Too many phone calls
Another common complaint about MOHELA is the number of phone calls borrowers receive. Most of these complaints related to delinquent student loan payments.
According to one of our readers, he received constant phone calls even if his payment was just a couple of days late.
Another borrower with loans serviced by MOHELA said, “My loan got about 9 days overdue. I owed them a $10 payment, and they called me multiple times, all hours of the day. I paid it, yet they still called for almost a week later with their auto calling robot crap, interrupting my work day, etc. It’s ridiculous.”
Another reviewer said MOHELA started calling their in-laws’ house when the loan became delinquent by 21 days.
3. Issues with MOHELA student loan transfers
There are times when student loans get transferred to and from different loan servicers. When this happens, loan information can get lost or mixed up. This is the case for some MOHELA borrowers.
For example, one borrower had their student loans transferred to MOHELA from another servicer. They claimed there were a number of errors that occurred during the transfer. The biggest error was the total amount they owed doubled from $100,000 to $200,000. Despite several calls to MOHELA to fix this, at the time of their complaint, nothing had been changed.
4. Customer service
A common thread with most complaints about MOHELA is their customer service. Common complaints include bad or misleading information. They also fail to follow through on borrower requests.
One Student Loan Planner reader said MOHELA’s customer service was nice, but the servicer didn’t initially apply an interest rate discount. The borrower had to bring it to MOHELA’s attention.
These types of customer service issues can be frustrating for borrowers. People plan their whole repayment plan around advice they receive. It’s important to do your homework. Don’t rely on information from your loan servicer’s customer service department.
MOHELA student loan: What you can do if MOHELA is your servicer?
Despite some borrower issues, MOHELA isn’t seen as poorly as other loan servicers. In 2018, the Consumer Financial Protection Bureau (CFPB) only received 119 complaints about MOHELA. They also have an A+ rating through the Better Business Bureau (BBB).
If MOHELA is your loan servicer and you aren’t happy with their service, know that you don’t have to stay with them. At Student Loan Planner, we can help you find the best way to repay your loans. This could mean consolidating your loans to a new servicer. Another option is to refinance your loans through a private lender.
The repayment of your student loans is one of the most important financial decisions you’ll face. You don’t have to put up with a bad loan servicer if you’re unsatisfied.