Federal Student Aid, an office of the U.S. Department of Education, is the largest provider of student financial aid in the nation.
If you have a complaint about problems with your federal student loans or your loan servicer, you can file a complaint online on the Department of Education Federal Student Aid complaint page. The page will ask you if you want to log in to your FSA account.
Federal student loans are made by the government, with terms and conditions that are set by law, and include many benefits (such as fixed interest rates and income-driven repayment plans) not typically offered with private loans.
FSA is responsible for managing the student financial assistance programs authorized under Title IV of the Higher Education Act of 1965. These programs provide grant, work-study, and loan funds to students attending college or career school.
Federal student loan servicers handle your federal student loans on behalf of the U.S. Department of Education. The biggest loan servicers are MOHELA, Aidvantage and Nelnet. Your loan servicer might have changed during the payment pause. Find out who your loan servicer is by logging in to your student loan account.
Immediately contact your loan servicer. You may be able to change your repayment plan to one that is based on your income.
Can Borrowers Sue a Student Loan Servicer? In general, borrowers can sue a student loan servicer. If there is a class-action lawsuit against a provider or school, borrowers automatically become a part of the class-action lawsuit but are not directly suing any party.
Your interest charges will be added to the amount you owe, causing your loan to grow over time. This can occur if you are in a deferment for an unsubsidized loan or if you have an income-based repayment (IBR) plan and your payments are not large enough to cover the monthly accruing interest.
When the time comes to start making payments, only the student is obligated to repay these loans — not the parents. In fact, there's no co-signer. If the student defaults on a federal student loan, it will affect the student's credit and won't be reported on the parent's credit history.
The Ombudsman Group is dedicated to helping resolve complaints related to the federal student aid programs, including Direct Loans, Federal Family Education Loan (FFEL) Program loans, Perkins Loans, and grant programs.
Submit a Complaint by contacting the following: U.S. Department of Education, Office of Federal Student Aid (FSA): studentaid.gov.
Consumers can submit complaints about financial products or services by visiting the CFPB's website or by calling (855) 411-CFPB (2372). Employees who they believe their company has violated federal consumer financial protection laws are encouraged to send information about what they know to whistleblower@cfpb.gov.
File a Federal Complaint
You can submit a complaint through the bureau's online database and follow the process of the dispute. This is where your written documentation will be useful because you will want to show what has already been presented and the response you received.
The Department of Financial Protection and Innovation (DFPI) regulates student loan servicers operating in California.
visit your account dashboard and scroll down to the “My Loan Servicers” section, or. call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243.
If you default on your student loan, that status will be reported to national credit reporting agencies. This reporting may damage your credit rating and future borrowing ability. Also, the government can collect on your loans by taking funds from your wages, tax refunds, and other government payments.
Roughly 42.7 million Americans have outstanding federal student loan debt — that's about 12.5% of the U.S. population, per census data.
The average monthly student loan payment is an estimated $500 based on previously recorded average payments and median average salaries among college graduates. The average borrower takes 20 years to repay their student loan debt.
The easiest way to contact the Ombudsman is to file an on-line assistance request thru https://studentaid.gov/feedback-ombudsman/disputes/prepare. Other contact options are: Mail: U. S. Department of Education.
Public Service Loan Forgiveness (PSLF)
The PSLF Program forgives the remaining balance on your Direct Loans after you've made the equivalent of 120 qualifying monthly payments while working full time for a qualifying employer.
If you default on a federal student loan, then your wages or bank accounts can be garnished without a court order or judgment. The maximum that can be withheld for federal student loan garnishment is 15% of your disposable income.
If you have federal loans, look into programs that will adjust your monthly payment based on your income and family size. Just remember that as your income increases, so will your monthly payment. Consider deferment or forbearance. These are options that can temporarily reduce or postpone your monthly payments.
You don't get reported when you're in forbearance. During the on-ramp period (through Sept. 30, 2024), we automatically put your loan in a forbearance for the payments you missed. Here's what this means: Your account was no longer considered delinquent and was made current.
If you're in a short-term financial bind, you may qualify for a deferment or a forbearance. With either of these options, you can temporarily suspend your payments. But keep in mind that forbearance and deferment have pros and cons. Student loan payments have restarted, and regular interest rates have resumed.