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 2021!
|Lender||Variable APR||Eligible Degrees|
|1.89% – 5.99%1||Undergrad & Graduate|
|1.99% – 5.64%2||Undergrad & Graduate|
|1.99% – 6.84%3||Undergrad & Graduate|
|1.91% – 5.25%4||Undergrad & Graduate|
|2.25% – 6.53%5||Undergrad & Graduate|
|2.17% – 4.47%6||Undergrad & Graduate|
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1 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount.
The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.
To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
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 Feburary 1, 2021.
2 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 2.98% APR (with Auto Pay) to 5.49% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.34% 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 October 26, 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 10/26/2020. 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.
3 Important Disclosures for CommonBond.
Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. 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 0.15% effective Jan 1, 2021 and may increase after consummation.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of 5 years and is reserved for applicants with FICO scores of at least 810.
As of 02/17/2021 student loan refinancing rates range from 1.91% APR – 5.25% Variable APR with AutoPay and 2.95% APR – 7.63% Fixed APR with AutoPay.
5 Important Disclosures for SoFi.
6 Important Disclosures for PenFed.
Annual Percentage Rate (APR) is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed Rates range from 2.99%-5.15% APR and Variable Rates range from 2.17%-4.47% APR. Both Fixed and Variable Rates will vary based on application terms, level of degree and presence of a co-signer. These rates are subject to additional terms and conditions and rates are subject to change at any time without notice. For Variable Rate student loans, the rate will never exceed 9.00% for 5 year and 8 year loans and 10.00% for 12 and 15 years loans (the maximum allowable for this loan). Minimum variable rate will be 2.00%. 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.