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It was the first servicer to receive a punishment from the department last year — on October 30, 2023, the department announced it would be withholding $7.2 million in pay from Mohela over its ...
The Department of Education is penalizing one of its student loan servicers for failing to send billing statements on time to 2.5 million borrowers.
The Department of Education said MOHELA inadvertently used the 2022, instead of 2023, poverty guidelines tables to calculate payments when transitioning borrowers from the REPAYE to the SAVE Plan.
The plaintiffs claimed that after becoming candidates for the program in August 2022, MOHELA did not respond to their requests, leading them to submit the request a year later. According to the plaintiffs, MOHELA nonetheless requested that the borrowers resume payments to their PSLF-eligible loans. [6]
The Public Service Loan Forgiveness (PSLF) program is a United States government program that was created under the College Cost Reduction and Access Act of 2007 signed into law by President George W. Bush to provide indebted professionals a way out of their federal student loan debt burden by working full-time in public service.
An improper payment is a government payment that "should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements". [2] Earlier legislation regarding improper payments included the Improper Payments Information Act of 2002. [3]
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