I have a consolidated loan with my ex-wife which in itself is a challenge.  We recently went through 4 months of @$%# with our servicer after our loans were transferred.  We owe 150k and just received a new bill for 190k.  I’ve read your posts and find our situation quite interesting. We’re on IBR and also the PSLF.  It’s hard to know if we are being taken advantage of regarding capitalized interest.  The 4 month hiatus in payments was due to the difficulty in getting straight answers from the new servicer about how our payment went from 400 to 1400 monthly when we’ve been on IBR since 2007.  I was close to writing to the ombudsman because the customer service was so abhorrent.  I documented every call, email and letter. I figured we spent over 100 hours on it.  My ex wife and I were given so much conflicting guidance you wouldn’t believe it.  After the payment got reset I hit fatigue so I never contacted the ombudsman. 

Somehow our payment got reset to 520 monthly.  I’ve asked several times with the current and prior servicer how our payment is calculated.  My ex has remarried she now has 3 additional dependents plus our two children.  In addition her spouse owes another 40k in student loans. No one was able to tell us what went into the IBR calculation.  ITS LIKE A BIG MYSTERY..  After the payment was rectified we got a forbearance for the 4 months. I asked to not be charged interest since I felt they were the reason for the delay. Of course no luck.  Our finacial situation didn’t change drastically in the past year. 

Now my question- how did the loan jump by 40k overnight?  I understand that interest accrues but what triggered this amount?  It’s hard living with so much uncertainty.  I have no way to plan for the future without knowing if the payment will jump to some astronomical rate.  I was prequalifued for a mortgage last month but now worry this extra debt will kill my chances.  Why can’t I see in writing how the payment is calculated and what’s up with the interest.  At this rate the loan will be 400k if and when we can use the PSLF program. I was looking at my original paperwork - we owed 100k when all this started.  How can congress allow this sort of treatment and disfunction? Any help appreciated.  Your site is very helpful.  Thanks.

Yikes.  What a giant pain. 

To begin with, forget about telephone communications and start communicating with loan servicers in writing.

As far as your specific question, I can’t know exactly what’s going on in terms of amounts, but I can tell you that capitalization of unpaid interest is triggered after a period of forbearance.  Could it be that?

I’m a return visitor on this issue.  I read the above information with hope and consternation. No really I appreciate this site greatly. My loan was transferred from mohella to fedLoans in August. We had just submitted documentation of annual income when it switched. Of course our paperwork didn’t follow. We spent four months with fedloans trying to get a straight answer about what info was required to reapply for IBR.  Very poor misleading and inconsistent guidance. It was like answer of the day when we called. I started using the secure email system but even then my questions would not get direct anstwered. 

Our loan went from 150 to 190 in December. When I asked why I was told it was because our loan had been bought by fedLoans and we had to Pay all the interest in limbo.  We were in forbearance for four months due to the horrible customer service.

When I read the first list it seems that number 3 was triggered. Of course if our loan transition had been smoother and our payment hadn’t gone from 350 to 1450 monthky perhaps we could have actually made the payment. But with a family size of 8 it was impossible.

So now the second list. It seems fedLoans conveniently used number 3 to catch us up in capitalization.  Like I said earlier we had just been approved for another year on IBR with mohella when our loan was transferred.  Then we were told to resubmit to fedLoans. It took 4 months to resolve with them.  They were unable to give us a straight answer on how to complete the forms. Our situation is complex with divorce and consolidated loans and two different family units. Somehow mohella could handle out situation. We were told it was a different process with fedLoans. Really?? 

It seems like these servicers use any chance possible to make the situation worse for borrowers. Why are there no consumer protections in place for borrowers?  So at first our payment was finally reset at 520 monthly which was inline with mohellas prior calculation. Then two months later were told it was going to 950 monthly out of the blue.  When I called they didn’t have our calculation right and I had to correct their math. I haven’t herd back. They seem unable to even stop the Ach payment which I’m unable to make in one payment.  It is at the point of absurdity. I’ve read many other posts and now believe most of the comments to be right on the money.  Is it even worth contacting DEPT OF ED ombudsman?