SUBMIT A COMPLAINT

U.S. Department of Education / Horrible Loan Consolidation Service

P.O. Box 242800, Louisville, KY, United States Review updated:
Contact information:
Phone: 18005577392

I've been trying to consolidate my loan from ACS to Direct Loans since July 1st, when the new interest rates came out. Originally I was told the whole process would take a couple weeks, but whenever Direct Loans would send out the payoff amount request to ACS, ACS would never receive it. This went on for weeks before I got Direct Loan to fax the request to ACS. Finally a few weeks ago Direct Loans said they got the payoff amount from ACS and that they would send out the amount to ACS on September 14th. Since then I've gotten a bill from both lenders for October 14th. ACS claims they never received the payoff amount while Direct Loans repeatedly claims they did and that I now have a loan with them. ACS immediately agreed to put my loan into forbearance while this gets figured out (actually it was their idea) but I had to speak with three different customer service reps before Direct Loans would put the loan into forbearance. The funny thing is they don't have my loan, irregardless of whether they sent a check or not. Until ACS receives the payment from Direct Loans how can Direct Loans claim I need to now send them money? During all this ACS has been nothing but helpful while Direct Loans has been completely useless. All DL does is go by what's on their computer without even considering that they did something wrong and that's why the whole process has been a nightmare. Tonight I got them to put the loan into forbearance and asked if they could figure out whether or not the payment was sent properly. I was told no. Just no, without a reason or anything. Direct Loans has also given me 3 different time tables for how long ACS should take to receive and accept the payoff amount; 7-10 days, 15 days (after I told them its been over 10), and 30 days now. I completely regret trying to consolidate with them. This is even more complicated because while I've been in the process of consolidating I've made 2 scheduled monthly payments to ACS so now ACS has one payoff amount and Direct Loans has a different amount.

I'm at a complete loss as to what to do now. ACS can't do anything and Direct Loans refuses to do anything, all they say is to keep calling ACS to see if they received the payoff amount. They won't even try sending another payoff check to ACS. Is this really my job to try and figure out? I thought I only had to fill out the paperwork and the two lenders would take care of the rest, especially Direct Loans. I'm going to give this till November and if it isn't straightened out, will try to cancel the consolidation with Direct Loans and stay with ACS. I don't even know if that is an option anymore but I can't think of anything else. I just hope ACS finally receives the payment from Direct Loans.

Can anyone suggest anything? I seriously doubt anything will happen from now till November and the way the customer service reps at Direct Loans talk, I now have my loan with them even though ACS never received the payoff amount. I have two lenders claiming I need to send them payments for the same loan. I refuse to send any money to Direct Loans until ACS receives the payoff amount from them, but like I said Direct Loans refuses to look beyond their computer screen. Their computer is telling them I now have my loan with them. I'm afraid that before this is over I'm going to have to get a lawyer. I'm completely exhausted with this whole experience.

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Comments

  • Jo
      Mar 19, 2010

    Its acs that has the issues not direct loans. I consolidated 3 student loans and only had this same problem, with the ACS loan.. ACS is a bad loan/processing company.

    0 Votes
  • No
      Mar 20, 2010

    Direct loans is our problem. They lied over and over to us about the status of their release and consolidation. They assured us each time we called in the last 4 months and probably 4 phone calls from me and my husband that they were done or would be by the end of that work day. They were not and we are still dealing with my husbands consolidation. Wells Fargo has been patient and riding our loans until the other end really does the job...what I don't get is that they have these unskilled workers that tell untruths over and over again with out any quality inspection of the service they give...they are absolutely disappointing! Want them looked at--hard! One girl even told me at Direct Loans that she was "doing me a favor"...I told her that I just wanted someone to do their job honestly, timely and correct...she was incredibly rude.

    +1 Votes
  • Sl
      Jul 06, 2010

    I am having the same issue here as well. I am in the process of consolidating as well and I am still waiting on ACS to recognize the payment from Direct Loans. I believe the process can take up to 30 days from what I was told by Direct Loans. ACS did send in the payoff statement to Direct Loans so I know the address that is on file has to be accurate. Its amazing how slow this process takes. With Sallie Mae, it only took 3-4 business days to acknowledge the payoff from Direct Loans. All I know is that when 30 days is up, I will be calling Direct Loans and keep hounding them to take care of the process.

    0 Votes
  • Kr
      Dec 04, 2010

    I contact direct loans in the past about possibly consolidating my student loans. Without my permission, they bought ALL my student loan debt, even debt that was being forgiven for teaching. I called Direct Loans week after week before they finally sent what they claimed was the paperwork I signed authorizing this. They do not have the form that authorizes the consolidation, only the inquiry.
    They will not deal with me, and I cannot get any straight answer out of them. Does anyone have a name and number of a lawyer that has successfully taken on Direct Loans with an issue like this? I am located in KY by the way.

    +1 Votes
  • As
      Jan 11, 2011

    Just to add some of my own problems with Direct Consolidation:

    1) The worst is that they will include any loan they have knowledge of in your consolidation and pay no regard to reflecting the accuracy of the list of loans you requested to be consolidated. For people that play an active role in their finances and want several consolidation loans at different interest rates with intentions of paying off the highest interest ones first, this is in my opinion, fraud. (Moreso with the 10 day "correction" period which barely covers the postal time.)

    2) The representatives on the phone are misinformed and *do* misinform. I received several recommendations with regard to "aging out my loans" and after a dozen phone calls, speaking to a supervisor, and several weeks, slow progress was made.

    3) Similar mismanagement on my several attempts to apply for IBR. They refused to accept the fact that I had a large amount of loans outside of Direct Loans still waiting to be consolidated (over 90% of them actually), and denied my application saying that the (10% of my total debt) was too small to qualify for the IBR plan.

    This is literally the worst financial experience of my life.

    0 Votes
  • Ha
      Jan 30, 2011

    i am going through the exact same thing with direct loans. first they had my name wrong. i had them fix that. then they lost my promossory note. i resubmitted it. then they lost my income docs and tax release form. i resubmitted those. they said i had to have them in by jan. 4. i then got notice that i was cancelled because they did not get those documents. when i called to see what was going on they said that they got the documents of the 4th and went ahead and cancelled me because it was too late. so i reapplied for everything. that was 23 days ago and whenever i call the help line it says that i am still in the "varification stage". the website says the varification stage should last no more than 5 days. when i call to make sure that all is in order and that they have all of my documents they say yes. i started this process back in october. i am trying to clean up my credit and have these loans all in one payment, as well as be able to finish my education. these hold ups that are based on mistakes that i am not making are holding me back. they say this is an easy process, but i have not found anything easy about it. any advice would be welcome. i don't know what to do at this point.

    0 Votes
  • Ji
      Mar 05, 2011

    It's OBVIOUSLY corrupt to the core and the higher ups are all in bed with the banksters.. that may explain very well this con game these con artists pull, it all starts at we the people highest/finest class house + 535 = Mark Twain.. from there the criminal ring works it's way down
    Sorry folks, but just a fact how corrupt it really is

    +1 Votes
  • Jp
      Apr 03, 2011

    Something has to be done about the direct loan servicing center, and department of education. A couple months ago made a good effort to consolidate my defaulted loans via direct loans. But as soon as I sent all my paperwork in for consolidation, the department of education sold my student loans collectors, thereby increasing my debt about $6, 800. I over-nighted the necessary forms on Thursday morning. When I called them a week later and asked them why my loans had been sent to collection, they told me that direct loan had 'processed' my paperwork on Wednesday, and my application status was "cancelled" on Tuesday. I don't feel that I am responsible for their processing delays (I know all my paperwork was at direct loan servicing center on the previous Friday), and so I have consulted a lawyer. But why have my loans been sent to collection regardless of 'their' delays, when I clearly did everything I could to consolidate my loans. If they would consolidated my loans, I would have paid only $286/month the first time around. With the $6800+ of collection costs and interest, my monthly payment will go up to $320/month, the next time I consolidate. But worse yet, I have to get through 9 months of rehabilitation, with my collection agencies, before I can consolidate again. If anyone has a similar situation, I encourage them to email me.

    +1 Votes
  • Dr
      Jul 12, 2011

    I agree something must be done! I have had the same problem. I had a two loans with ECMC. And they gave me a very hard time saying that my loans were in default but I paid and I paid and I am still paying! I had my loans since 1999! I wonder if I will ever finish my payment off! They charged high interest rates! And also offset my tax refund without my notice. Than I decided to consolodate. And I went to a consolodator promising to handle everything even threats made by ECMC. ECMC tried to put me in two collections agencies one was GC Services out of Columbus, Ohio and one was ACS Affiliated Comp Services Long, Beach CA. ECMC tried to force me to a repayment and tried to garnish me while I was trying to consolodate with Direct Loans which a company by the name of College Education Services in Tampa FL had hooked my up with. And this College Education Services out of Tampa FL charged $300.00 for the consolodation process than I came to find out from Direct Loans that I could have done it for free! I really had been had by all of these companies promising me the moon! But all were empty promises! So now my loan is with Direct Loans and I thinking that it would be much better service now that I am with them. But that did not happen either because right after the consolodation process was over not even did I start paying them they turn me over to all three credit reporting agencies without my notice Equafax, Experian, and Trans Union. So now I feel at about this time that I have just jumped from a fire to the frying pan situation. I feel I was being mugged by all of these different agencies! I had to fight with the IRS to try to get my taxes back and I had to file an Injured Spouse Form from the IRS because I don't work and am in school full time studying Criminal Justice at Ashworth College online for my associates degree. And my husband is the sole person that is working. Finally I got an answer from the IRS stating that I would get my taxes back. I than had to fight with Experian, Equafax, and Trans Union to get Direct Loan account removed and along with them ECMC, ACS Affiliated Comp. Services, GC Services. And also paying a third party consolodator College Education Service $300.00. So now I am fighting about eight different companies amongst them also US Department Of Education and Federal Aid and Civil Rights Department Of Education. But did not get any help from any of them so I wrote and spoke on the phone to the US Department Of Justice Attorney Generals office and wrote a letter to the FTC Federal Trade Commision and complained to about more than 20 different agencies about this situation. So I don't know how I am going to resolve this issue to get my loans to a fair settlement. But for now Direct Loan is where my loans is and I have been successfully at getting rid of ECMC. I complained to College Education Services in regards to them misleading me to think that they were the only way to get to Direct Loans but I found out that was not true and told them that I learned that I did not have to pay them the $300.00. So I wrote College Education Services a legal notice to get my full $300.00 refunded back. And also thinking about get an attorney to get everything situated. I feel that there is defently some kind of a scam going on with these student loans and the way these agencies handle everything. But I feel as I am in the legal career that it always a good idea to look at all options before deciding to get any kind of loans. For what ever reason it might be always do your research and check all your facts and then make your solution don't just jump to conclusion that because it looks good from the outside that it is. But instead go with your gutt. And don't settle for less. And always ask questions lots of questions to find out the facts before comming a final decission! Chitrita Dumire, Richmond, VA

    +1 Votes
  • Ds
      Aug 18, 2011

    From my experience, the DLS is a classic example of poorly managed governement. It is ran without any apparent oversight and is devoid of any consistency. It is a shame, considering the level of funding the U.S. Dept. of Education receives, to imagine a department bearing the United States of America's moniker can be so ill-adapted to serve its given purpose.

    I went through my first consolidation this year, 2011, which was to have been closed on the last day of May. At that time I had included all my outstanding student loans, per the NSLDS website. Having gone through consolidation with DLS, I expected everything to be taken care of at that point in time. About one week into the month of June I received a notification of defaulted status for student loans, which I had included in my original (and only) consolidation. My information was forwarded to a collection agency through the US dept of Education. At the time of consolidating (the one which closed at the end of May) these loans were not in default status. They were, however, included on my original application, but simply left off the finished consolidation. I have since been trying to get DLS to add these loans to the consolidation and it is now past the middle of August, yet still nothing. I have received mis-information, to down right lies from personnel at the main DLS center (800-557-7392) and the default resolution group (800-621-3115).
    In fact, it was Pioneer Recovery group, contracted by the US Dept. of Education, which informed me I had been misinformed.

    My question is this: who benefits from a prolonged ordeal such as I have attempted to describe above? In my humble opinion, the collection agency, Pioneer Collections (877-695-0611), is the real winner.

    I wonder who has a financial interest in that organization? It appears to me that federal money is being squeezed through the cracks from the dept of education in order to satisfy a private venture's bottom line. Classic corruption in these United States of America.
    From some of the other posts I've read here, I am further lead to believe this. It is a troubling matter for us as U.S. citizens to utilize channels put in place to benefit our population in an indiscriminate fashion, and be met with a wash of inaccuracies and uncertainties. I intend to contact my congressional leaders at the U.S. House of Representatives, as funding bills begin there and encourage a full audit of the DLS center in order to see what sort of things could be potentionally occuring there. The worst part of this is corrupt poloticians most likely have a hand in this.

    I could very well be wrong in my assumptions, but the reality isn't a stretch if one considers similar events in this countries recent years. The problem with the Fed isn't the size or the money, it is the abstinence of real oversight.

    -1 Votes
  • Bb
      May 27, 2012

    Direct Loan Servicing Center has some major problems. First, you never speak to the same person on the phone and you have to re-tell your situation each time. Second, each representative has their own perception on your situation and they give you answers that fluctuate quite widely. I have asked reps about payment differences, for my case, with a ICR and IBR, and the answers have differed each time. At one point, the rep said the IBR would "X" amount per month which turned out cheaper compared to ICR. Then, the next time I call to confirm to make sure I'm changing my payment system correctly the Rep says I don't qualify for ICR. Then, the next time I call, the next rep says the last rep made a mistake because that rep thought I had a PLUS loan but I don't. Overall, this place is majorly disorganized. I would like to know a formal place to not only complain, but most importantly, get my answers CORRECTLY answered so I start paying my loan back!

    0 Votes
  • An
      Aug 08, 2012

    I am in the process of referring Direct Loans to the New York State Attorney General for fraud, Strongly recommend that anyone considering loan consolidations avoid using this firm. My experience over the past four months has been essentially that they utilize 'bait and switch ' practices and have zero credibility

    +1 Votes
  • Jp
      Dec 03, 2012

    I've had such bad experiences with this place, it's hard to believe that they are still around. This place has provided me the single best reason to support anarchy. The first time I tried to consolidate my loans, I overnight-ed the forms on Wednesday. They got there on Thursday, but were sitting on someone's (some chump's) desk, all the way until the following Wednesday. By then my application had 'expired', so the ### forms had to be filled out all over again. I called in to complain to the manager (after talking to several extremely rude and cursing 'customer service' reps), and just 3 days later, my loans were sent into collections (with 18% 'collection fees' accumulated). Obviously, this place decided to abuse it's power, against an openly dissatisfied client. I talked to a few lawyers who said they couldn't help (because basically if the govt. screws you, there is nothing that can realistically be done). ---Anyways, I started paying on all my loans until i pulled them out of collections (via federal rehab program, entered by Obama). Now, about a year later, I redid the consolidation application, and I got a letter to confirm that 3 of 4 of my loans are going to be consolidated. For some reason which wasn't explained, and I find to be completely explainable, expect by the nature of shoddy tasking or political corruption (ie abuse of power), there is a single loan (federal unsubsidized), which they are not including for consolidation.

    I've been around for some time now, and dealt with many corporations and various divisions of govt., and I have never encountered such blatantly vile strategies, or unfriendly and unprofessional representatives. I urge anyone who's had bad experiences with this place to speak up about it. I am currently looking into filing a more formal complaint against direct loan servicing center.

    0 Votes
  • Jp
      Dec 03, 2012

    My current issue is with direct loan and ACS too!

    I've had such bad experiences with this place, it's hard to believe that they are still around. This place has provided me the single best reason to support anarchy. The first time I tried to consolidate my loans, I overnight-ed the forms on Wednesday. They got there on Thursday, but were sitting on someone's (some chump's) desk, all the way until the following Wednesday. By then my application had 'expired', so the ### forms had to be filled out all over again. I called in to complain to the manager (after talking to several extremely rude and cursing 'customer service' reps), and just 3 days later, my loans were sent into collections (with 18% 'collection fees' accumulated). Obviously, this place decided to abuse it's power, against an openly dissatisfied client. I talked to a few lawyers who said they couldn't help (because basically if the govt. screws you, there is nothing that can realistically be done). ---Anyways, I started paying on all my loans until i pulled them out of collections (via federal rehab program, entered by Obama). Now, about a year later, I redid the consolidation application, and I got a letter to confirm that 3 of 4 of my loans are going to be consolidated. For some reason which wasn't explained, and I find to be completely explainable, expect by the nature of shoddy tasking or political corruption (ie abuse of power), there is a single loan (an ACS Laon), which they are not including for consolidation.

    I've been around for some time now, and dealt with many corporations and various divisions of govt., and I have never encountered such blatantly vile strategies, or unfriendly and unprofessional representatives. I urge anyone who's had bad experiences with this place to speak up about it. I am currently looking into filing a more formal complaint against direct loan servicing center.

    +1 Votes
  • Jp
      Dec 22, 2012

    Please LEAVE your EAMILS... when writing a complaint. This information can be gathered and used to bring forth CLASS ACTION lawsuits. .

    +1 Votes
  • Ap
      Feb 11, 2013

    this company is obviously ill equipped to handle this type of student loan account. they do not have a viable website to handle email, or a telecommunication system that can except calls in a timely manner. you can lose hours waiting on someone to take your call, which now appears to be 2 weeks before anyone can assist, and you may have to keep calling back because of poor information. when i make a payment on their website, i have to call in to make sure that the payment is posted in their system, so that i do no incur late charges. if i dare, i can mail a payment, but they will charge 7 days worth of interest due to time for the payment to be posted to my account, which i do not give money away in that fashion. i believe that it is time for the Department of Education to remove this company as servers for student loans.

    0 Votes
  • No
      Feb 21, 2013

    I consolidated my loans and 2 months later, the website changed and my payment history was gone. In addition, my previous balance of $4007 and been jacked up to $4959. They also claim that I consolidated my loans back in 2005 while I was still in school. They are lying. I never did such a thing. It seems to me that they consolidated my loans but added the original amount borrowed together instead of the principal balances I still owed. I finally got their version of my payment history, but they aren't accurate and they claim that the reason my balance has increased, despite me paying over $800, is because of capitalization adjustments and incentive fees. I don't understand this. I'm basically paying to maintain my same balance. This is ###. My email is shayla.[protected]@yahoo.com. I'm ready to join a class action law suit.

    0 Votes
  • Ch
      Mar 21, 2013

    Pam Jones is a supervisor at direct loans and is the most incompetent "supervisor". If you ask questions of the person who answers the phone..they never have any intelligent answers and when you ask for a supervisor that are just as incompetent as the customer service reps. Please never use this company for ANYTHING. They are nice at first until they get your money then they treat you as ###.

    0 Votes
  • Cl
      Jun 18, 2013

    Can someone please tell me what other options we have to consolidate our student loans? Is this the only option. I just had an anxiety attack over the mere thought of contacting the direct loan phone numbers. I just realized that my on-line application only had 10 out of my 18 loans. Has anyone had that issue? There must be something, someone, that we can contact. I tried calling the U.S. Department of Education FSA Ombudsman Group. 1-877-557-2575 At first they were helpful, but now they revert back to Direct Loan for questions. Anyone out-there with solutions? I understand the DL is horrible. But, I cannot continue to have anxiety attacks, this is literally causing me harm, and I'm quickly falling into depression and rage. I'm angry, frustrated, exhausted, sadden, beaten, I don't think I can do this for much longer. Anyone with suggestions, on who else to contact? Is it worth getting a lawyer involved? If so, with what $ are there any organizations that may help.

    0 Votes
  • Jp
      Aug 13, 2013

    This was my first and last student loan. I started getting charged for my student loan while I was still attending school. The request for payments started in my first month of school. Not only was my school corrupted (Harrison Career Institute) so was this loan office (Direct Loans). In June-July of 2008 I was dealing back and forth with the supervisor Pam Jones at (800) 848-0981 and was told my student loan was paid in full. I then asked for a written notification so that I could have documentation to send to the credit bureaus, because the loan was still appearing on my credit report as not paid in full after payments and garnishments were made. Pam told me to give it two weeks to receive the letter needless to say she never sent the letter. When I called I was told my loan still existed and it was passed due. When I asked to speak to Pam Jones, I was told she no longer worked there. This has been the worst experience ever and I will never ever deal with them ever again. My school was shut down for fraud I’m wondering why this place has not been shut down as well. Peyton

    0 Votes
  • Pa
      Apr 10, 2014

    I wish I had read this board before consolidating. Evidently they consolidated my same loans twice with two different servicers. My only servicer was supposed to be Nelnet. However fedloan somehow got the application too. No one at direct loans apparently knows how this happened and now they are "researching" for the second time in a row. In the mean time I have 2 consolidated loans with 2 servicers with the same loans .Clearly, they screwed up. I will never recommend consolidating loans after this experience. Especially since it sounds like personal information is not very secure in the process.

    0 Votes

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