<p>Sorry if this has been answered before - I'm not finding it.</p>
<p>My son has both subsidized and unsubsidized gov't loans for undergrad and graduate school. The interest rates varied from year to year. His loans are on deferment right now, but as he has bits of savings here and there, he'd like to buy down some of the unsubsidized that have higher interest. </p>
<p>However, he's being told he can't do that. He sent a payment in, specified it was for a particular #, but they applied it evenly across all his loans. When he called, they did allow him to just earmark the unsub'd ones. But they said he can't target any particular year's loan, because it was all one loan with just different disbursements. That doesn't make sense to me - they have to track it separately since each has a different interest rate, so why can't they apply the payoff specifically?</p>
<p>Does anyone have any experience with this?</p>
<p>We also have fed loans on behalf of our kids, and I occasionally send in an extra payment to target the higher interest loans, and don't have any trouble. I can't figure out why his doesn't work the same way.</p>
<p>Did he consolidate? If not, I don’t understand why they won’t let him pay down certain loans. Are these Direct Loans or FFELP loans? If FFELP, who is the servicer?</p>
<p>I don’t have any personal experience with it, but it does sound odd to me. Unless he has consolidated his loans I would think they are all separate loans and he should be able to pay one down without paying on the other. After all if he was paying interest as he went along it wold have to be applied to the unsub loans only.</p>
<p>Who are the loans through? Were they direct loans or through a bank (before they all became direct)?</p>
<p>They are Direct Loans. They are not consolidated.</p>
<p>On the website, our loans show up as individual loans with individual pay off amounts; his shows up as one loan with multiple disbursements (sub, unsub, undergrad, grad all together). It is almost acting like a consolidated loan, but it isn’t.</p>
<p>Direct Loans have all been assigned to one of several servicers. Who is his servicer? If they are making it difficult to pay off certain loans during the deferment period, they are NOT providing the customer service they promised ED that they would provide when they were awarded the servicing contract. Supposedly, servicers will by vying for business with ED based on customer satisfaction. I would suggest that your son let the servicer know that he will be pleased to contact the Dept of Ed to let them know how difficult they are making repayment for him … and he needs to follow through with a formal complaint if they do not make things easier. </p>
<p>I just checked my kids’ accounts. D’s are through a FFELP servicer, and the website makes it clear how to pay things off. S’s are DL loans, with a servicer whose website is clear as mud in this regard. It stinks, in my opinion. Students should be easily able to find out how to pay off their loans early … and they should be able to pay interest & pay down chosen loans ON THEIR OWN TERMS when they are repaying early.</p>
<p>How can you tell who the servicer is? All the info is just on the Federal Direct website. As near as we can tell, we are just dealing with the government.</p>
<p>When they log into the nslds.gov site and see their loans listed, there should be a little blue box (might have a number in it, I can’t remember) to the left of each line. If you click on that, it will show the individual loan as well as the loan servicer (and there may be an address, phone number, etc. for them). For Perkins loans, the servicer will be listed as the school who made the loan.</p>
<p>Thanks! We didn’t even know about that website - the one we’ve been using was a Dept of Education site. It does list all the loans separately, and does have the little blue box (with number). The servicer is ACS or something like that. Under “interest rate” it just said “variable.” So I still don’t understand what is going on - why the interest rate isn’t listed for each. Next step, I guess, is to ask S to carefully review all previous paperwork, and make sure he didn’t miss something along the way. (It it was consolidated, would it say so somewhere?) </p>
<p>After that, assuming no surprises, I’ll encourage him to contact the Dept of Ed. and try to understand what is happening.</p>
<p>I thought that was an ED site? Anyway, it’s odd that it says “variable”…how old are his loans? I just checked my kid’s loans and they all say fixed. Servicer is:
DIRECT LOAN SERVICING CENTER (ACS)
P.O. BOX 5609
GREENVILLE
TX 754035609
800-848-0979 </p>
<p>They email her statements, I think quarterly, and she can pay the interest on unsub loans online. Idk whether they let her choose which loans since we pay all the accrued interest at once and she’s still in school.</p>
<p>In NSLDS, if the loans are consolidated, it will say that they are consolidated.</p>
<p>ACS is a servicer contracted by DL. </p>
<p>I really think that the information needs to be a lot clearer for students. It can be very difficult for students to understand what the heck is going on. </p>
<p>I would suggest your son contact the 800 number to talk to a rep & ask about paying off the highest interest loans first. If he is not satisfied with the response he gets, he should contact the Federal Student Aid Ombudsman to discuss his concerns.</p>
<p>Got this email from my S. What should he do next?</p>
<p>"I finally was organized enough to call the servicing company again, and got the same answer: I cannot target separate “loans” because they are all considered disbursements of the same “continuous” loan over several years - even though I said that I applied for them separately each year. I can only specify to pay off the unsubsidized loans. I argued for a while, telling her how unclear the website was, and could tell she was getting frustrated with me, but she said she never knew of anyone being able to pay off separate disbursements. She said I was welcome to write a letter specifying but she didn’t guarantee they would follow it. I told her I would issue a complaint to the Department of Education and the Ombudsman and she said, you do that.</p>
<p>Also, we had a disagreement on the term “prepay.” She said I was not prepaying because I was out of school, the loans were simply in deferment. I’m not sure what her point was, because she said at no point could we target specific “disbursements.”"</p>
<p>Unfortunately, I believe that that is correct. I checked with someone who knows a lot about loan repayment & she said the particular loan cannot be designated. I thought it could, but now I do not think that was a correct assumption. Wish I could tell you otherwise.</p>
<p>Wow.
A student trying to do the right thing by paying MORE than strictly necessary on his student loans and running into nonsense by the loan servicer.</p>
<p>I remember calling ahead to learn how to payoff an UNsubsidized student loan that I had son accept one semester, knowing that we would pay it off shortly when the money magically appeared in our ‘extra money’ account.
Got instructions, how to send, what to put in letter to make sure that the sum was applied the way we wanted it, etc etc.</p>
<p>A few weeks later, I logged onto that nslds.gov website to check and found, surprise, the sum I had sent was applied equally over all the loans, including his subsidized loans still in deferment.
Yeah, that would make sense to NOT retire the unsub loan so that it could continue to accrue interest due.
Took several phone calls but eventually they actually REapplied the $$$ correctly and completely retired the unsub loan.</p>
<p>Can you long on to your account at the servicer and see all the loans? Usually from there you select loan and payment to make sure payment is done to a specific loan. Do it only line for payment, not mailing it in.</p>
<p>With DDs Direct loans, they applied the payment amount to all the loans, but when called a few days later would apply to whatever loans requested. For some reason, the payment has to clear the bank first, then they can change it. Drove, DH nuts.</p>
<p>I know I would definitely try everything in my power to get them to apply to the loans you want. Considering that they are not consolidated, I just cannot think of a logical reason NOT to do apply early repayment where you want it applied. Servicers are being rated according to customer satisfaction. Maybe indicating that you will complain to the Ombudsman might help get what you want.</p>