Note that the situation for student loans has changed due to the impact of the coronavirus outbreak and relief efforts from the government and many lenders. Check out our Student Loan Hero Coronavirus Information Center for additional news and details.
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If you’re having issues with your student loan servicer or lender and can’t resolve them, you can always contact a student loan ombudsman. An ombudsman reviews both sides of the problem to help identify a solution.
Let’s look at what a federal student aid ombudsman — or a private student loan ombudsman — does and how to contact one. Specifically, we’ll look at:
- What a student loan ombudsman does
- Which issues an ombudsman can often resolve
- What to do before submitting a request to an ombudsman
- How to contact a student loan ombudsman
- Next steps after contacting an ombudsman
The Federal Student Aid (FSA) Ombudsman Group is an unbiased and confidential resource to use when you have issues with your federal student loans. The Consumer Financial Protection Bureau Ombudsman, which is also free of charge, is a similar resource for federal and private student loans. There are also some lenders and state governments that offer student loan ombudsman or advocate services.
If your account is wrongfully in default or the balance is incorrect, a student loan ombudsman can intervene.
A student loan ombudsman is a neutral contact, meaning they are not your advocate in a dispute. But they are not on the loan servicer’s side, either. The ombudsman enters the conflict from a neutral standpoint. They then evaluate the data and enable both parties to come to a resolution.
An ombudsman can’t overturn decisions, but they can create an argument to present to the lender or collection agency. The ombudsman can help the decision-makers make an informed ruling, which can help give you relief.
A student loan ombudsman can assist with many issues, including:
- Loan balance and payment discrepancies
- Explaining interest or default charges
- Loan consolidation
- Identifying repayment options
- Reviewing laws affecting your loans
An ombudsman can’t process requests for loan forgiveness or repayment plans, though. Your loan servicer or lender is the point of contact for repayment management strategies.
Reaching out to the U.S. Department of Education ombudsman or the CFPB’s Ombudsman should be a last resort. It’s a step you should take only when you have exhausted all other options. Try to work directly with your loan servicer, credit bureau or collection agency on your own first.
The Department of Education’s ombudsman group, for instance, created a resolution checklist you can use to help manage problems on your own. Use the checklist and follow their recommended steps to try and resolve any issues. You should check off all the appropriate steps for your problem to ensure you did all you could before contacting the ombudsman.
Here are two common problems borrowers face and the steps you should take before reaching out to a student loan ombudsman:
1. Incorrect loan balance
If your account balance has the wrong total, contact your loan servicer directly. You can gather bank statements or payment confirmation emails, and submit your proof to them.
When you contact the loan servicer, record the date, time and name of any person you speak with and follow up via email or in writing. Save the originals of any payments, receipts or emails about your issue. If you make payments electronically, download and save copies of the confirmation notifications.
If the loan servicer asks you to submit documentation, send in copies via certified mail so you have a record of when they received it.
2. Inaccurate credit report
If you think your loan servicer sent incorrect information to the credit bureaus and it’s affecting your credit score, you can dispute the report.
If you contact Experian, Equifax or TransUnion, and show documentation of your accurate loan balance and payments, they will correct your credit report. You can check your credit report for errors for free at AnnualCreditReport.com, or use a third-party service like My LendingTree to monitor your credit.
If you’ve tried to resolve the issue on your own but failed, you can contact the federal or private student loan ombudsman online by mail or phone.
If you use an online form or email, you can share your personal information or remain anonymous.
|Education Dept. Ombudsman||CFPB Ombudsman|
|Online||Contact the Feedback Center or use the VA GI Bill Feedback Tool if you’re a veteran||Email [email protected] or submit a complaint form|
|The U.S Department of Education
P.O. Box 1843
Monticello, KY 42633
|Consumer Financial Protection Bureau
Attn: CFPB Ombudsman’s Office
1700 G St. N.W.
Washington, DC 20552
When reaching out to the ombudsman, make sure you have the documentation about your situation. You can use the Department of Education ombudsman’s checklist (above) to outline the essentials.
If your student loan dispute revolves around a lender-specific debt, you should contact their ombudsman (if it has one), at least initially, by phoning its customer service line or visiting its website. The FedLoan Servicing ombudsman, for example, maintains a phone number and email address for requests.
Additionally, if your education debt is state-owned, contact your state’s higher education authority to determine if it offers an ombudsman or advocate service.
After you’ve contacted the Department of Education ombudsman or the CFPB ombudsman, they’ll research your situation and review the documentation you sent. They’ll work with you, your loan servicer, your school and even the collection agency managing your debt, if necessary.
They will help you identify potential solutions and steps forward. For example, they may advise your loan servicer that the loan amount on your account is incorrect. Or they may refer you to another agency for issues outside their scope.
The student loan ombudsman will ensure there is a resolution and will create a plan to avoid future issues from cropping up.
For more information about how to handle student loan disputes, learn more about defense to repayment rules and how they can help you.
Andrew Pentis contributed to this report.
Interested in refinancing student loans?Here are the top 6 lenders of 2020!
|Lender||Variable APR||Eligible Degrees|
|1.99% – 6.65%1||Undergrad & Graduate|
|1.99% – 7.10%2||Undergrad & Graduate|
|2.99% – 6.44%3||Undergrad & Graduate|
|2.39% – 6.01%||Undergrad |
|1.99% – 6.43%4||Undergrad & Graduate|
|3.18% – 6.07%5||Undergrad & Graduate|
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1 Important Disclosures for Laurel Road.
Laurel Road Disclosures
All credit products are subject to credit approval.
Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.
As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.
Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.
Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.
Interest Rate: A simple annual rate that is applied to an unpaid balance.
Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of June 23, 2020. Information and rates are subject to change without notice.
2 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Splash Financial loans are available through arrangements with lending partners. Your loan application will be submitted to the lending partner and be evaluated at their sole discretion. For loans where a credit union is the lender, or a purchaser of the loan, in order to refinance your loans, you will need to become a credit union member.
The Splash Student Loan Refinance Program is not offered or endorsed by any college or university. Neither Splash Financial nor the lending partner are affiliated with or endorse any college or university listed on this website.
You should review the benefits of your federal student loan; it may offer specific benefits that a private refinance/consolidation loan may not offer. If you work in the public sector, are in the military or taking advantage of a federal department of relief program, such as income based repayment or public service forgiveness, you may not want to refinance, as these benefits do not transfer to private refinance/consolidation loans.
Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of May 1, 2020.
Fixed APR: Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed Rate options range from 2.88% (without autopay) to 7.27% (without autopay) and will vary based on application terms, level of degree and presence of a co-signer. Rates are subject to change without notice. Fixed rate options without an autopay discount consist of a range from 2.88% per year to 6.21% per year for a 5-year term, 3.40% per year to 6.25% per year for a 7-year term, 3.45% to 5.08% for a 8-year term, 3.89% per year to 6.65% per year for a 10-year term, 4.18% per year to 5.11% per year for a 12-year term, 4.20% per year to 7.05% per year for a 15-year term, or 4.51% per year to 7.27% per year for a 20-year term, with no origination fees. The fixed interest rate will apply until the loan is paid in full (whether before or after default, and whether before or after the scheduled maturity date of the loan).
Variable APR: Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Variable rate options range from 1.99% (with autopay) to 7.10% (without autopay) and will vary based on application terms, level of degree and presence of a co-signer. Our lowest rate option is shown with a 0.25% autopay discount. Our highest rate option does not include an autopay discount. The variable rates are based on the Variable rate index, is based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of April 27, 2020, the one-month LIBOR rate is 0.43763%. The interest rate on a variable rate loan is comprised of an index and margin added together. The margin is a fixed amount (disclosed at the time of your loan application) added each month to the index to determine the next month’s variable rate. Variable rate options without an autopay discount consist of a range from 2.01% per year to 6.30% per year for a 5-year term, 4.00% per year to 6.35% per year for a 7-year term, 2.09% per year to 3.92% per year for a 8-year term, 4.25% per year to 6.40% per year for a 10-year term, 2.67% per year to 4.56% per year for a 12-year term, 3.44% per year to 6.65% per year for a 15-year term, 4.75% per year to 6.93% per year for a 20-year term, or 5.14% per year to 7.10% for a 25-year term, with no origination fees. APR is subject to increase after consummation. Variable interest rates will fluctuate over the term of the borrower’s loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a co-signer. The maximum variable rate may be between 9.00% and 16.00%, depending on loan term. The floor rate may be between 0.54% and 4.21%, depending on loan term. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
3 Important Disclosures for SoFi.
4 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.19% APR (with Auto Pay) to 6.43% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 6.43% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of June 15, 2020, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 6/15/2020. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.
© 2020 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.19% effective June 10, 2020.