How to handle issues with your student loans

As student loan payments resume after a multi-year hiatus, problems are bound to crop up. According to Nerdwallet, "borrowers filed about 101,500 student loan complaints with the Federal Student Aid office in 2022 — more than double from 2021 — and that number is poised to increase this year as repayment starts." 

Complaints can run the gamut, with common ones including missing payments or incorrect application of payments, discrepancies in a loan's balance or interest rate, incorrect reporting on payment history to the credit bureaus, and shifts in due dates, per YahooFinance. If these issues sound familiar or you're running into others, it's vital to know where to turn to get them resolved. Because, as YahooFinance highlighted, "the good news is that there are ways to dispute these errors."

Step 1: Reach out to your student loan servicer

Before you reach out to anyone else, contact your student loan servicer. "Ninety-nine-point-nine percent of the time, if you call the servicer and point it out, it will get fixed. But of course, that's not 100% of the time," Betsy Mayotte, president and founder of The Institute of Student Loan Advisors, told Nerdwallet.

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You can find your servicer's contact information on your monthly statement or the National Student Loan Data System (NSLDS) website. But before you pick up the phone, "take some time to review your loan documents to ensure that there is actually an error," advised YahooFinance. Further, you'll want to have those documents on hand during the call.

To ensure you remember your talking points, you might even first "write down a summary of your complaint and what you would consider a reasonable solution," suggested Saving For College. Additionally, for this call (and any further calls you end up placing), make sure you're keeping detailed notes, marking down when you called, who you spoke to, and highlights from the conversation.

Step 2: Determine a next point of contact if necessary

If you're unsatisfied with the resolution — or lack thereof — that your servicer offers, you can contact a different party. According to Nerdwallet, these are the "three main avenues for your student loan complaint":

Federal Student Aid office: Per Nerdwallet, the U.S. Department of Education’s Federal Student Aid office has "the most power of any entity to directly address your issues." Get in touch by calling 800-433-3243 or visiting the online feedback center.

State ombudsman office: If you're looking for a faster resolution and live in the 15 states plus the District of Columbia that have student loan ombudsman offices, you can contact them for help. Lenders may also have an ombudsman "whose role it is to resolve complex problems," per Saving For College, and there's also an FSA Ombudsman Group, though this should be a "last resort," per Nerdwallet.

Consumer Financial Protection Bureau (CFPB): For private student loans, the CFPB is the place to turn, though it also has oversight over federal servicers, Nerdwallet explained. You can call them at 855-411-2372 or file a complaint online.

When filing a complaint, it's important to write an effective letter. You'll want to offer a clear, concise overview of the problem and provide evidence (though make sure to send photocopies rather than originals). Make sure to include your name, account number, and contact information. Request that the party confirm receipt of your letter, and ask for a response within a reasonable timeframe, "such as 2-4 weeks," suggested Saving For College.

Step 3: Keep following up as needed

As Nerdwallet underscored, "a resolution or response to your complaint could get caught in a traffic jam." As such, if you're dealing with an unresolved student complaint, it's important to stay persistent and keep following up. If it seems you've hit a dead end and "neither your servicer nor a complaint resolves your problem, consider contacting your members of Congress."