The Missouri Higher Education Loan Authority is being targeted by a U.S. Senate subcommittee following numerous complaints of poor customer service from student loan borrowers.

MOHELA is facing two class-action lawsuits that accuses the quasi-government agency of failing to process and make decisions for borrowers in a timely manner. Kansas City Mayor Quenton Lucas testified at the hearing in Washington DC on what some of his city’s residents have experienced.

“The sometimes hours of wait times on phone calls. A 39-day average email response timeframe – 39 days,” Lucas said. “We’ve heard more – posting incorrect monthly payments, misplacing records and payments, denying promised relief.”

Another complaint was that the agency directed borrowers towards “self-help” and away from live customer service.

MOHELA CEO Scott Giles did not attend the hearing, but Scott Buchanon of the Student Loan Servicing Alliance spoke on behalf of the agency. He testified that MOHELA is performing the best that it can as it tries to navigate a “constant shifting” in expectations.

“Recent accusations suggesting servicers are responsible for a large backlog of public service loan forgiveness applications and that the backlog is intentional are also false. Today FSA (Federal Student Aid) makes all decisions about whether to approve or deny forgiveness,” Giles testified. “The vast majority of the backlog resides at a resource-constrained FSA, which is now also struggling with the massive FAFSA failures.”

No actions were taken at Wednesday’s hearing, which was conducted by U.S. Sens. Elizabeth Warren, D-Massachusetts, and John Fetterman, D-Pennsylvania.

Copyright © 2024 · Missourinet



Missourinet