The Student Loan Gods Are Evil
Until today, I couldn't really complain too much about the student loan industry (despite all the recent negative press). I was able to get money when I needed it to pay for law school. I thought that was a pretty good deal. They also let me put those loans in deferment when I had no job and no money. I've caught them in a few accounting errors, but hey, mistakes happen, and those mistakes were quickly rectified. My student loans are now down to a manageable level (under $40,000) so I tend not to harp too much about them because I have friends with loans still in the six-digit realm.
So imagine my surprise when I went to pay this month's bill on-line and a little pop-up window came up that said pursuant to federal regulations the loan company gets to apply principal to my two remaining loans in the manner that it wished. What? That seemed strange to me. But, sure enough, after receiving my payment, the loan company applied everything to my big loan and only paid the interest due on my little loan. It's not as if this is affecting me financially, because both of my loans have the same interest rate, but it still cheesed me off.
So I e-mailed my up-until-now-very-friendly loan company, and asked which federal regulation permits them to do this. No response. So then I e-mailed them again. This time I received a response that was non-sensical and still didn't reference the regulation in question. Another e-mail from me requesting the federal regulation in question. I received a lengthy response to this one, explaining that there is no federal regulation but, in fact, I really only have one loan because they send me one bill for the two loans each month. (This logic is ridiculous on so many levels.)
I shot them another e-mail -- this one lawyeristic -- explaining to them that I believe this is illegal, especially if they are applying this mythical federal regulation to people who have different interest rates for their various loans. I also mentioned that I would be bringing up this issue with my old law firm and my lawyer-husband (personally, I don't know who is scarier). I wonder if I'll get a response. Hmmm -- perhaps a certain NY AG may also be interested in this.