I had a rather unpleasant email from one of my student loan providers, MOHELA, in my inbox when I woke up this morning.
We have not heard from you to assist in resolving your account status, and your account remains past due.
Wow. That’s news to me.
Considering the fact that my student loan account is set up for automatic payment every month, I was a little shocked to hear that I was past due. I checked my account and they had levied a monstrous $2.62 late fee onto my account. I guess they were punishing me for not reminding them to pull the automatic payment I signed up for years ago.
I obviously had to call and set things straight.
Mohela Customer Service Could Use Some Work
I called in and inquired about the charge. I specifically asked why the autopayment hadn’t pulled like it has every other month for the last three years. I was told that because all of my three loans had entered into deferment due to my part time school status, the autopay stopped. Makes sense.
However, when I requested that one of my loans (the unsubsidized one) be entered back into repayment, apparently it takes a while for autopay to get reapplied to the loan. This would have been nice to know when I initially talked to them about moving that loan back into repayment. I was never told to make a manual payment.
As nicely as I could, I explained to the representative that I have always paid my bill on time and that I clearly would have done so in July if it hadn’t been for the autopay not working. I expected her to say something like, “Of course Mr. McKee. I’m sorry you weren’t informed that you would have to make a manual payment to restart the loan. I’ll waive the fee and you can pay the balance online.”
Instead I got:
“It’s not our fault. We sent you a letter. I can take your payment now for the full balance due, including the late fee.”
You have got to be pooping me (my PG version of a more common phrase). First of all, you didn’t send me a letter because I’m signed up for paperless communication, and my electronic inbox has no communication about that. Second of all, it’s a $2.62 late fee and I’m a very good customer who has never missed a payment before, so I would imagine I deserve some goodwill anyway. Third of all, you’ve got to be pooping me.
Maybe she didn’t understand the situation. I explained it again, hoping she would realize the right thing to do. I didn’t want to ask for the fee to be waived; I wanted it to be offered.
Once again, she told me I could pay the full balance, fee included, over the phone or online.
Frustrating.
I finally caved and had to ask for the fee to be waived.
Mohela Didn’t Even Admit Fault
She put me on hold for a minute, then came back and said, “We can only waive one late fee over the lifetime of the loan. Are you sure you want this one waived?”
Basically, I got treated exactly the same as someone who just forgot to make a payment.
It didn’t matter that they canceled my autopay, then didn’t start it back up in time, then didn’t tell me to make a manual payment. It doesn’t matter that when I log into my account, it gives me no information about any payments being due:
If you can’t see that picture, it says: Next Payment, 1/6/2011. The amount field is completely blank.
Even if I had logged in to see if I needed to make a payment, I wouldn’t have seen anything. However, according to Mohela, it was my fault I missed the payment.
What Would You Have Done?
Part of me wanted to ask for a supervisor, explain the situation, and demand that the fee is waived without it counting for my “one fee waiver” over the life of the loan.
However, the other part of me knows that I will never be late again. And if I am late again, the fee is less than three bucks. At this point, the fee had been waived and I could move onto the next item on my life agenda.
The docile part of me won. I just hung up the phone, took my $2.62 one-time credit, and moved on with my life.
Would you have taken the offer (essentially admitting fault but still getting your fee waiver) or would you have fought harder to make Mohela admit fault and keep your other late fee forgiveness stashed away?
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Kevin McKee is an entrepreneur, IT guru, and personal finance leader. In addition to his writing, Kevin is the head of IT at Buildingstars, Co-Founder of Padmission, and organizer of Laravel STL. He is also the creator of www.contributetoopensource.com. When he’s not working, Kevin enjoys podcasting about movies and spending time with his wife and four children.
I think in this situation, given the low amount of the fee and the fact that you probably wont be late ever
again I probably wouldn’t have fought any harder. I have a few strategies that usually work to get “fees”
removed from my account. The first is I usually simply threaten to take my business elsewhere. Whether
it’s my bank or cell phone company or what have you, it usually works to simply say, “well I think I’ll just
have to move my business to a new company” (Note: obviously that wouldn’t work in this situation). If that
doesn’t work and I truly think the fee is outrageous, a quick mention of filing a complaint with the BBB
usually does the trick.
Yeah, I definitely can’t just move this stuff without either paying it off of moving it to another company, which will be expensive. However, if you do threaten to move for other products, I like to name specific companies that I know are big competitors.
Ouch, what a pain. Though I qualified for a subsidized Stafford loan this year I opted not to take it out. I considered taking it and putting it into a savings account to earn some money but over two years taking out the loans would only earn me $200 with interest rates so low. Plus the earnings could be wiped out with just two months of interest if something went wrong. Not worth dealing with that kind of hassle or the risk. Looks like I won’t have the option next year anyway if the current debt ceiling negotiations pass
I would have taken that deal in a heartbeat. That’s why I’m not paying my subsidized loans anymore. I can definitely afford to pay them, but why would I if I don’t pay interest on them?
After working for the bank since January, I know that we’re told to follow a certain procedure and only waive a fee if a customer requests it AND if they qualify (you’d be surprised how far people will go to save a buck, even if it is their fault and they’ve shown no effort in correcting issues themselves!)
I’m sorry that rep couldn’t see it was a bank error. If I’d seen that for one of my customers, I’d be extending whatever courtesy I could to make up for it. That’s not what my company would stand for as far as customer service, and I hope you don’t have to deal with that company much longer.
Well hopefully next time I have a problem, I get you or someone like you!
I would have gone really far for it to be removed, and definitely would have asked for a supervisor as soon as she argued. I hate when people mess around with dumb reasons for simple errors.
My question is since you were technically late on your bill AND admitted fault (sort of), does this count as a delinquency that will be reported on your credit report?
They don’t report late stuff on your credit report unless you’ve been late for 60 days. This has no impact at all on my credit.
I hate situation like this. i’m with you Kevin.
Normally when dealing with any customer service, you can just hang up and call back. Chances are you will get a different person that might be more compassionate. It really comes down is it worth your time to fight the issue for $2.62. Then again, I’m talking to the guy who spent an hour scraping candle wax…
Does this annoying situation make you want to pay off the loan early (gasp!) so you don’t have to deal with them in the future?
For five seconds I thought, “I’ll just pay off all the loans here completely so they don’t make any more money from me.” But then I got realistic.
Why would I pay off 0% loans when I have other student loans are higher rates? I’ll just keep doing what I’m doing; emotions don’t mix well with money.
Oh man, this sounds like suck a headache! I’m impressed you were subtle for so long. Since this was clearly not your fault, I would have absolutely asked for the fee to be waived right away, and for it not to count as my “one free fee waiver.” I totally would have spoken to the manager, too. I would have been really nice and courteous about it, but yeah, I’d have done it.
Speaking of which, I’m going to write my bank right now and ask them to reverse a fee I got charged for transferring money from my savings to my chequing, since I only transferred the money so the balance in my chequing account would be high enough for the new minimum balance requirement the bank just imposed.
I agree that you should get money for that. When the bank changes the rules, they should give you the courtesy to make changes to adjust to the new rules.
I don’t think it was worth the fight of $2.62 so I probably wouldn’t have pressed the issue any further.
I’ve heard of this happening before when part-time status throws everything off like that.
More motivation to pay them off as soon as possible 🙂
It makes me want to apply to their IT department and fix the situation. But then I realize I don’t really care…
I believe the company will keep tract of the waivers. If this happens again during the same year, they may not wave it. Stick with your principle, it is worth it.
Even if I do miss another payment, it’s $2.62. I figure my time is worth more than that. At least, that’s why my day job thinks. 🙂
Even if I miss a payment, and it’s totally my fault, I still ask for the late fee to be waived. I’m not some bozo who constantly pays her bills late. I consider myself quite a catch when it comes to being a good customer. Companies should try to keep me happy. If they don’t, I take my business elsewhere.
Although I probably wouldn’t waste too much time fighting a $2.62 offense, it’d definitely serve as motivation for me to pay off my student loans as quickly as possible so that I can terminate my relationship with the lender.
That sucks, but I’m with you. You have to choose your battles. $2.62 is not really worth wasting more time tracking down a supervisor, filing a complaint, and whatever extra actions you need to invest. I’m sure you have better things to do with your time, like make your next hit video!
I know it’s only one late payment for a couple bucks; however, it’s the principal of the thing. I would have asked them to remove it gently and politely. If they said no, I would have speficily pointed out it was there fault, and if I needed to take the issue up with consumer affairs I would be more than happy to, saying something like, “If this happened to me for this small payment, I’m sure it’s happened to others and probably for a lot larger fees. Maybe consumer affairs would like to know about this too.” If that didn’t work, then I’d have to see, but probably wouldn’t do too much actual fussing for a small amount.
Mohela just took over as servicer of my account, and they started off with a bang by ADDING $175 to my monthly payments for no discernible reason. No explanation. No forewarning. Nada.
Now I have to do battle with their Customer No-Service line on Monday. Wish me luck.