Looking for “higher education loan authority of the state of Missouri news”? Maybe you’re wondering, what is MOHELA?The organization was created as a state system in 1981 to help students get access to postsecondary education (the acronym MOHELA stands for Missouri Higher Education Loan Authority).
Despite its origins, MOHELA now handles a lot of student loans, and services even more. In some ways it doesn’t really resemble the office that it was and how it was set up to operate in the beginning!
Now, it has become the center of a major scandal related to student loan payments over time.
MOHELA Misconduct Revealed
Since last year’s return to repayment, millions of borrowers have reported problems with a student loan servicer, challenges related to inaccurate data, improper communications or various kinds of negligence on the part of a loan company.
But there’s additional scandal happening with MOHELA right now, where officials looking into the matter are seeing some disturbing trends.
What is Happening with MOHELA?
- At the heart of the accusations is the contention that MOHELA created what’s called a “call deflection” strategy – that means systems where company strategies sent borrowers into a limbo of misinformation, and drove them away from the real operational parts of the loan servicing website.
- Specifically the accusations contend that MOHELA led borrowers away from talking to live customer service representatives, although that was really the primary way to get loan accounts handled.
- In addition, the reporting on MOHELA’s alleged negligence cites incorrect payments, missing records and lost payments.
If the loan servicer provides inadequate information and communication, borrowers can’t effectively manage or stay current on their accounts.
Can MOHELA Loans be Forgiven?
MOHELA loans are eligible for various federal loan programs, including income-driven repayment plans, the SAVE program, and public service loan forgiveness for those in public administration or civil service jobs.
But that doesn’t mean that it’s easy to pursue these programs, especially if the loan the lender or loan servicer is giving you the runaround. And that’s exactly what’s alleged here.
Call deflection is only one type of a broader playbook that involves delaying and deflecting transaction processes that would resolve payment on a student loan account. In too many cases, the lender has carte blanche to report whatever numbers they want. This leads to jacking up monthly payment rates without actual accuracy and precision. And often, they do this, with NO regard for the former student and his or her household. It’s the same callous capitalism, now with post-modern communication breakdowns, making it even more unfair for those acting in good faith.
Why is Missouri Against Loan Forgiveness?
When people mention Missouri opposing loan forgiveness, they’re often referring to the Biden administration’s efforts for broader federal loan forgiveness programs.
People cite the prevalence of conservative judges in the state Supreme Court, and other places in the legislature where people are critical of the Biden efforts.
The problems with MOHELA don’t help at all, because this was set up to be a state program. Now that it’s getting a black eye in terms of public relations, the state of Missouri looks more like a hostile place for student loan borrowers.
What is the Average Student Loan Debt in Missouri?
Public records report that the average student in Missouri owes about $34,400 on their student loans.
But some of these problems go far beyond even specific amounts of money. If the lender or loan servicer doesn’t provide the tools, the process often breaks down into something with high liability and the threat of litigation.
When is a Good Time to Get Help?
That’s why we take it with a grain of salt when offices tell you to “talk to your lender or loan servicer first.” That is the first step to take, but you shouldn’t be under any illusion that it’s going to be successful. Resolution is probably going to require getting a third party involved, whether it’s legal representation, a mediator or someone else.
In other words, many of these companies reply only under pressure, which is frustrating for all involved.
Take a look at our previous posts on lender horror stories for more on what to do if you are under pressure in paying or resolving your student loan debt. Know your rights!
