Communication Nightmare? 4 Things AES Does WRONG

AES is a top handler of student loans. It’s not a lender, per se – it’s a loan servicer, meaning that its role is purely administrative. But it’s the conduit that borrowers work through when they’re trying to pay off their student loans, so it’s important that these offices work in good faith, and with transparency and accuracy, to help borrowers succeed.

Unfortunately, reviews from the field show this isn’t always working the way it’s intended. Here are four of the things people are complaining about with AES managing their student loans:

Gaps in Communications – and More

First, you have complaints that, in dealing with AES, people find the information is false or missing. Either one can have a deleterious effect on the student loan process.

“My loans were consolidated before I started to make payments, and I’ve been making consecutive on time payments under an IDR plan ever since,” writes one borrower with a grievance to the CFPB. “I applied for PSLF …and I got into the program, so my loan was transferred … As soon as my loans were transferred, I received a letter welcoming me … and to let me know that I was going to be receiving a letter stating how many payments were going to count towards my forgiveness. I never got the letter, but I did notice on my statements that my loan was showing in two parts, the subsidized and the unsubsidized portion. The subsidized portion showed 0 payments and the unsubsidized showed 44. I did not understand why that was happening, so I called them, and they were not able to tell me the reason, so they submitted a review for my account, I called them once a month for a whole year, and they told me that it was taking longer than usual to review the accounts. I finally got a call from them … to let me know that the review was ready, and that the number of payments remained the same, but they were not able to give me an explanation. I didn’t get a letter or anything from them. I still don’t understand what is happening, I have all my payment history and my bank statements showing all the payments and it makes no sense to me that if the loans are consolidated they have a different number of qualifying payments.”

Bad information IS confusing, inherently. The whole goal is trying to keep the account straight – not mess it up!

Inaccurate Payments

All you have to do to thoroughly derail any loan process is to incorrectly post payments to a particular account or loan

We see complaints that AES is overpaying one loan and underpaying another, to the extent that total chaos and confusion ensues:

“The BBB reports on more than one occasion that payments were deducted from borrowers’ accounts and not applied to the student loan amount,” writes Bethany Mccamish, going over some of the reports on the company. “They were then called multiple times a day for ‘late payments.’ In other scenarios, payments were made over the phone. A few days later, the money was transferred back to the borrower bank account.”

That’s another type of obfuscation and error that creates eternal frustration and confusion with student loan processes.

Misapplying Program Options

This one is a big deal, because there’s actually a lawsuit going on against AES when it comes to the PLFS program aimed at forgiving student loans for a class of professionals.

Check out this Investopedia review that is kind of a mixed bag – on the one hand, authors suggest that AES has had all complaints resolved, but they do cite the ongoing related lawsuit.

“There were 24 complaints submitted to the Consumer Financial Protection Bureau in 2020 about AES,” writes Jen Smith.  “All received a timely response, and most were closed with an explanation—two resulted in monetary relief from the company, and two yielded non-monetary relief. Many of the narratives cited dissatisfaction with the company’s responsiveness to customer issues or a lack of flexible repayment options as the primary problem.”

Any kind of litigation signals problems with the student loan company. So keep an eye on this as it goes through the courts.

Delay and Paperwork Burden

In general, student loan borrowers complain about long delays in processing.

“Every year I have to recertify for the Income-Based Repayment (IBR) option,” writes a borrower quoted in McCamish’s piece. “Every year the DoE [Department of Education] sends an email when it’s time to complete it. Every other servicer processes accordingly. But AES rejects the application every year for some arbitrary reason and then demands I complete the application again. It’s obnoxious the amount of extra work they require because they just can’t seem to get it together.”

They also cite overwhelming burdens of going through tedious paperwork and a less than straightforward process that can also scuttle the understanding between lenders and borrowers that is so important for handling student loan accounts.

Fighting Back

As some experts mention in characterizing the AES problem, a lot of what borrowers can do involves knowing the facts, and having a clear picture of where they actually stand with their student loans.

A lot of this is in proactive documentation – knowing when you made payments, knowing what your balance was at any given point in time, and knowing what communications previously took place. Some lender call centers have fancy computer programs with archive notes to show operators a history of the accounts in its balance. If you have one of these types of documentation on hand on your end, it helps out a lot.

Also keep your eyes on this blog, and check out resources from CFPB and others. Stand up for your rights!