There are many options to file a complaint regarding student loans. It is common to file student loan complaints. A recent Consumer Financial Protection Bureau report shows that it received 8,407 student loan complaints in the twelve months ended September 2022, which is 59% more than the previous year.
We will show you how to file a claim on private and federal student loans.
There are reasons to file a complaint about a student loan
These are some of the most common reasons to file a complaint about a student loan:
- Your payment was incorrectly calculated by your lender
- Incorrectly, you were charged a late charge
- The loan was incorrectly placed in default.
- The balance of your student loan is incorrect, you believe.
- A financial aid office or private lender treated you unfairly.
- Your student loan servicer, or a collection agency treated you unfairly
- You are the victim of fraud, theft, or a scam regarding your student loan.
If your lender, financial aid office, or loan servicer handled the matter properly, then you shouldn’t file a complaint about a negative outcome to your loan.
A private lender may deny your student loan application due to the fact that you don’t have the required credit score. However, this doesn’t mean you are being treated unfairly or abusively. If you believe your lender unfairly denied the application due to characteristics like your race or sexual orientation, please file a complaint.
Another example is if your lender charges a late fee for late payments. If your payment was made on time and you have documentation supporting it, you can file a complaint.
How to file a complaint about a student loan
The type and nature of your student loan complaint will determine what you do. First, contact your loan servicer to resolve the problem. If these first attempts fail, you can escalate your concerns to the Federal Student Aid office (FSA) or CFPB student loans ombudsman.
After meeting with your lender or loan servicer, you will file all federal student loan complaints with Federal Student Aid Ombudsman Group of U.S. Department of Education. Private student loan complaints will be filed with the CSSPB.
You can file a complaint to the U.S. Department of Education’s Office of the Inspector General Hotline if you are a victim of student loan fraud or abuse. You can report other student loan fraud to the Federal Trade Commission.
Contact your student loan servicer to find out what type of student loan you have. You can also review your loan documents, billing statements, and other documentation. You can also check your FSA account to see all federal loans.
How to complain about federal student loans
Contact your loan servicer if you have a problem with federal student loans. Your service provider should allow you to make a complaint over the phone, online or by mail. After you have tried to resolve the issue with your loan servicer, contact the FSA.
You can file a complaint to the FSA by visiting the FSA complaints website. Here you can log into your account using your FSA ID, or you can file the complaint online without logging in. The FSA will respond faster if you provide your account information.
Make sure you have the following information ready before you submit your complaint to your loan servicer/FSA: a complete description of the problem, any supporting documentation (e.g. proof of payment, dates of calls, notes from customer service discussions, correspondence copies, etc.).
How to complain about private student loans
First, contact your private lender to resolve any concerns about private student loans. If that fails, contact the CFPB to request additional assistance.
Make sure you have all the documentation and a clear description of the problem before you begin the complaint process with your private lender. You should, for example, be prepared with proof of payment as well as notes from previous discussions.
After you have all the documentation, contact your private student loan lender. Many lenders permit you to lodge complaints online, over the phone and in writing.
If there is no solution, you can escalate your private student loan complaint the CFPB. The CFPB’s complaint webpage will be used to file your complaint. You’ll be prompted with a log-in or creating an account with your email or name. Please be prepared to explain your complaint and offer support.
Student loan complaints could lead to possible outcomes
These are the most common outcomes of student loan complaints:
- After a thorough investigation, the issue has been resolved to your satisfaction In this instance, you receive what you asked for, such as a reapplication of your payment.
- Although the issue has been resolved, it doesn’t mean you get what you wanted . In this instance, you and your lender find a compromise to resolve the problem. Your lender may agree to waive a portion of the fee if both parties are responsible.
- The problem has been resolved. In this instance, the research shows that the lender or loan provider made no mistakes, so there is no error to correct. For example, the late payment fees your lender charged were accurate.
It depends on the agency where you filed your complaint and its internal procedures what type of follow up you will get. You can expect an email acknowledging online complaints.
So you are clear about what to expect, ask for information on the next steps in submitting complaints. It will take time to resolve a complaint depending on how complex the issue is, what information was shared and how extensive the research involved.
FSA claims that complaints filed with your FSA ID get addressed quicker than those filed by borrowers who don’t log in. This is because research takes longer. The CFPB states that most companies respond within 15 days to complaints filed.
What if I am not satisfied with my student loan response?
Let’s say you are unhappy with the response to a student loan complaint that you have filed with your lender or loan servicer. You can escalate the matter to either the FSA Ombudsman Group or the FPB private student loans.
These two U.S. government student loan ombudsman office can help you resolve student loan issues to your satisfaction. If you have any questions, don’t hesitate to contact us.