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Hi Heather,
I’m requesting advice on getting a lender and servicer to honor a interest rate reduction benefit. The details of the situation are as follows:
In September 2007 I consolidated roughly $110K of federal loans with Graduate Leverage. The terms of the consolidation loan were for an interest rate of 3.375%, which would reduce to 2.375% after 24 consecutive on-time payments.
From September 2007 to May 2010, the consolidation loan was under an in-school deferment while I attended law school; and I made no payments during this time. In June 2010, I received a notice from Graduate Leverage stating that the payment due on the consolidation loan was past due, even though I had not received any statement indicating that the consolidation loan had entered repayment.
In June 2010, I contacted Graduate Leverage to ask why I had not received a statement indicating that any payment was due and to arrange to make the appropriate payment. During that call, Graduate Leverage stated that I could forbear payments due under the consolidation loan for six months rather than commencing payment immediately. I submitted the forebearance form in June 2010, and the consolidation loan entered repayment in November 2010.
Between June 2010 and November 2010, I learned that the servicing of the consolidation loan was transferred to Brazos. From November 2010 to September 2013, I made all payments due under the consolidation loan through Brazos. The interest rate on the consolidation loans should have therefore been reduced to 2.375% in November 2012. However, Brazos never applied the interest rate reduction.
In September 2013, Brazos transferred the servicing of the consolidation loan to Nelnet. At that time, I noticed on Nelnet’s website that the consolidation loan had been disqualified for the 1% interest rate reduction. I then contacted Nelnet to find out why the 1% reduction had not been applied. Nelnet stated that they did not know and directed me to Brazos.
I then contacted the prior servicer, Brazos, which stated that the 1% reduction had not been applied because of a missed payment. However, I had never missed a payment because the consolidation loans were enrolled in Brazos’s automatic payment plan since November 2010, when the consolidation loan entered repayment. I reviewed each Brazos statement, and no monthly payment had ever been missed. After several calls and correspondences with Brazos, Brazos indicated that the alleged missed payment was with respect to the payment due in May 2010.
I told Brazos that 1% reduction should be applied since (i) I had never missed a payment and made 24 consecutive on-time payments; (ii) I never received any notice in May 2010 indicating that repayment on the consolidation loan had begun; and (iii) the loans were in forebearance from May 2010 to November 2010, a period which does not mean that any payment was missed.
Do you have any advice on getting the current servicer to honor this on-time payment interest rate reduction?
Thanks
Hello,
I am facing a similar issue with my loan, now serviced by Nelnet. Have you gotten anywhere?
Thank you.