Michael Gill-Branion was struggling to get consistent information about his student loan repayment options.
As he worked to find an affordable repayment plan, he was surprised to see that his wife’s name was included on his federal loans, which had previously been in default. When he tried to make sense of his options, the University of Southern California graduate says that his loan servicer set up roadblocks, offering jargon-filled answers and little help.
He ended up filing a complaint with the Department of Education’s Federal Student Aid Ombudsman Group, where he discovered that he may be able to apply for income-based repayment.
While Gill-Branion is still working to get his loans on an affordable repayment plan — they are in forbearance — he says that working with the ombudsman was straightforward and informative. “It was very convenient and easy,” he says. “They’re extremely helpful. They will call you back. They will email.”
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Borrowers can turn to several federal agencies in order to resolve problems with borrowing or repaying student loans. Speaking out may help them resolve a disagreement, get clear information or alert the agencies to a larger problem with a servicer, lender or debt collector. Try these steps to resolve the problem.
1. Call your servicer first: “I think people should make an effort to resolve issues with their servicers,” says Persis Yu, an attorney at the nonprofit National Consumer Law Center who works in the Student Loan Borrower Assistance Project. For example, “if you get a bill and it doesn’t look right, you should call your servicer first,” she says.
Loan servicers should be able work through straightforward complaints, such as a misapplied repayment or other processing error. They may even have their own consumer liaisons, such as Navient’s Office of the Customer Advocate.
2. Get your records in order: Borrowers should keep documents in order to show that they’ve attempted to fix a problem on their own, say experts. “You have to keep a notebook,” says Leslie Tayne, director and managing partner of Tayne Law Group, a New York-based firm, and author of “Life & Debt: A Fresh Approach to Achieving Financial Wellness.”
“Keep track of who you spoke to, when you spoke to them and what the outcome was,” says Tayne. Borrowers should also keep track of any paperwork sent via fax or mail, hanging on to photocopies and delivery receipts.
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The FSA Ombudsman Group has its own information checklist, where students can see the kinds of information they should track, including the kind of debt they hold, conversations they’ve had and other relevant facts.
The Consumer Financial Protection Bureau also allows borrowers to submit related forms. “You can attach documents to your complaint, such as statements, contracts, receipts and letters to help us better understand your issue,” said a representative of the CFPB in a statement.
3. Figure out where to file: For complaints about federal loans, the Department of Education’s FSA Ombudsman Group works to resolve disputes related to federal direct loans and other government-backed debt.
Private loan complaints are better submitted to the CFPB, which has collected them since 2012. A borrower struggling with debt collectors can also go through the CFPB by submitting a debt collection complaint and selecting federal or non-federal student loan as the product. The Federal Trade Commission also receives complaints on student loan issues and debt collection.
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4. Settle on a satisfactory outcome: Federal agencies may be able to facilitate quick fixes, such as helping you get on income-based repayment, says Joshua Cohen, a Vermont-based attorney who focuses on student loans.
But don’t expect debt-forgiveness miracles. “While we certainly can’t make your debt disappear, we can help bring your concern to your financial institution’s attention,” said Rohit Chopra, the student loan ombudsman for the CFPB, in a statement.
Sometimes a number of similar of complaints can help federal agencies identify a bad apple or industry trend. “It’s volume,” says Tayne. “It’s like voting. Your vote counts.”
5. File effectively: When borrowers file complaints, they’re likely feeling fed up, but that doesn’t give them license to rant or rave.
Cohen, the student loan attorney, suggests keeping the complaint to a few pages, like a resume. “Write down: OK here’s the problem. This is why it’s a problem. Here’s what’s happened to create the problem. And here’s what I’ve been doing to work on the problem,” he says. Resist the temptation to write sentences in all capital letters and keep punctuation precise, he says.
Students can reach the agencies in various ways, including via phone, through mail or by filling out an online complaint form. But Tayne, the attorney and author, suggests getting something down in writing.
“I suggest that you write a strong, cohesive letter that somebody can totally understand,” she says. “Even if you call on the phone, I would always do something in writing.”
Trying to fund your education? Get tips and more in the U.S. News Paying for College center.
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5 Steps to File a Student Loan Complaint originally appeared on usnews.com
