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Started By
Message
Fun with student loan refinancing
Posted on 4/4/17 at 7:15 pm
Posted on 4/4/17 at 7:15 pm
I have a student loan through the Dept of Ed, serviced by MOHELA. The original amount was ~$27k at 6.125% (includes 0.25% for auto pay discount) for 25 yrs. I realize that the 25 yrs was a big shiny hook to get me to pay more interest, but had to do it at the time. Have about 19 yrs left to pay on it with a payment of $187.17.
I tried to get them to reduce my interest rate for being a good on time payer and never being late (which is what Sallie Mae/Navient did after paying on their loan for 2 years with no problem). MOHELA just came back with their same response of the only discount available was through auto pay. Whoop dee doo!
Now I'm in a position to pay more and the way their over payments of the normal payment are applied is this:
It just reads very oddly and I'm tired of dealing with them.
So I decide to try to refinance with SoFi. I put my info in and the best rate they can give me is ~5.3% at a 5 yr payback. It sucked but I wanted to get away from MOHELA. I saw that you can add a cosigner, so I added the wife on there and it reduced my rate to 4.115% (3.865% w/auto pay). Sweet, this will reduce my interest and force me to get this thing paid off.
I get a call from SoFi letting me know that everything has been approved and I should be receiving a welcome packet soon. They also let me know that the loan servicer will be....MOHELA!
So instead of just reducing my interest rate a little and them still making a good bit of money (which they already have off of me), they get charged a fee from SoFi for brokering the "new" loan.
Having a lot of experience dealing with student loans, mine and my wife's, it's no surprise that some people are just giving these loan servicers the middle finger.
Thank you for reading my story.
I tried to get them to reduce my interest rate for being a good on time payer and never being late (which is what Sallie Mae/Navient did after paying on their loan for 2 years with no problem). MOHELA just came back with their same response of the only discount available was through auto pay. Whoop dee doo!
Now I'm in a position to pay more and the way their over payments of the normal payment are applied is this:
quote:
Each time you satisfy a bill due, we will automatically advance your next payment due date and your billing statement will indicate a payment is not required for that bill. You may still continue to make payments to decrease your total interest cost and pay your loan off sooner.
It just reads very oddly and I'm tired of dealing with them.
So I decide to try to refinance with SoFi. I put my info in and the best rate they can give me is ~5.3% at a 5 yr payback. It sucked but I wanted to get away from MOHELA. I saw that you can add a cosigner, so I added the wife on there and it reduced my rate to 4.115% (3.865% w/auto pay). Sweet, this will reduce my interest and force me to get this thing paid off.
I get a call from SoFi letting me know that everything has been approved and I should be receiving a welcome packet soon. They also let me know that the loan servicer will be....MOHELA!
So instead of just reducing my interest rate a little and them still making a good bit of money (which they already have off of me), they get charged a fee from SoFi for brokering the "new" loan. Having a lot of experience dealing with student loans, mine and my wife's, it's no surprise that some people are just giving these loan servicers the middle finger.
Thank you for reading my story.
6
Posted on 4/4/17 at 7:35 pm to LSUSUPERSTAR
quote:
It just reads very oddly
Very normal. Just keep paying on your own schedule. It's set up that way to get you to pay only what you have to and collect the most possible interest. Make yourself a schedule and stick to it.
I guess you don't have to anymore, now that you refinanced.
Posted on 4/4/17 at 8:03 pm to LSUSUPERSTAR
Student loans are such a scam
Posted on 4/4/17 at 8:06 pm to TheOcean
I think student loans are a great thing, if applied properly. I wouldn't have a degree or my current job without them. I don't think the government should use them as a political tool or make significant money (or aquire significant debt, which ever way you see it) at the expense of its citizens.
Posted on 4/4/17 at 8:26 pm to LSUSUPERSTAR
quote:
They also let me know that the loan servicer will be....MOHELA!
If it helps, this just means MOHELA collects a tiny part off the top for collecting the money, SoFi still gets most of the interest.
quote:
Each time you satisfy a bill due, we will automatically advance your next payment due date and your billing statement will indicate a payment is not required for that bill. You may still continue to make payments to decrease your total interest cost and pay your loan off sooner.
Sometimes lenders will play tricks like this to catch the unwary. They'll promise "Hey, you don't owe anything this month!" but the interest still accrues. But these contracts almost always allow for early reduction of principal, so learn what hoops you have to jump through.
Posted on 4/4/17 at 8:31 pm to LSUSUPERSTAR
The problem is MOHELA services the loans, but they don't own them. so, contractually, they are very limited in what they can offer you. Most discounts on interest are actually created when the loan is created - with my Sallie Mae ones, when I signed the loan I was told I would get a discount fo auto pay and a discount after 24 months of ontime payment.
It's no different than people who had trouble getting mortgaged modified. It's cause the people who can amend the terms of the loan are not the people you talk to on the phone.
Yeah. I'm like 8 months ahead on Navient because of this.
Again, now SOFI owns the loan. so they get to set the terms. Mohela just keeps making their monthly cut for servicing it.
It's no different than people who had trouble getting mortgaged modified. It's cause the people who can amend the terms of the loan are not the people you talk to on the phone.
quote:
Each time you satisfy a bill due, we will automatically advance your next payment due date and your billing statement will indicate a payment is not required for that bill. You may still continue to make payments to decrease your total interest cost and pay your loan off sooner.
Yeah. I'm like 8 months ahead on Navient because of this.
quote:
I get a call from SoFi letting me know that everything has been approved and I should be receiving a welcome packet soon. They also let me know that the loan servicer will be....MOHELA! So instead of just reducing my interest rate a little and them still making a good bit of money (which they already have off of me), they get charged a fee from SoFi for brokering the "new" loan.
Again, now SOFI owns the loan. so they get to set the terms. Mohela just keeps making their monthly cut for servicing it.
Posted on 4/4/17 at 10:39 pm to LSUFanHouston
Not to hijack this thread, but I moved from self-employed to a salaried job in late February. I had been waiting to apply for a SoFi refinance until getting a salaried gig. At three pay periods/stubs in at this point, am I good to go? Or should/need I wait until a later point?
/hijack
/hijack
Posted on 4/5/17 at 7:27 am to Jwodie
SoFi couldnt give me jack. My interest rates is right around 3.5 percent through DoE serviced by Great Lakes.
It's hard to be happy about getting any raise when you know pretty much the next year your SLOAN payment is gonna dig deeper into your anus.
I am writing a 445 check every month already. I kinda pisses me off. I can afford a 900 car or a 2200 house payment if it weren't for that.
Then again, there's no way I would be in the position I am in today if I didn't either...
I am done venting now.. lol
It's hard to be happy about getting any raise when you know pretty much the next year your SLOAN payment is gonna dig deeper into your anus.
I am writing a 445 check every month already. I kinda pisses me off. I can afford a 900 car or a 2200 house payment if it weren't for that.
Then again, there's no way I would be in the position I am in today if I didn't either...
I am done venting now.. lol
Posted on 4/5/17 at 8:17 am to LSUSUPERSTAR
quote:
I realize that the 25 yrs was a big shiny hook
Loan Amortization Schedules are your friend..
Posted on 4/5/17 at 4:29 pm to LSUFanHouston
quote:
Yeah. I'm like 8 months ahead on Navient because of this.
Pay attention to them, Navient likes to reamortize your loan so you are paying the minimum payment. They did it to me twice and I had to go through the painful process of changing my minimum monthly payment. The first time I didn't even realize it until they sent me the notice 2 months later.
Posted on 4/5/17 at 4:56 pm to Weekend Warrior79
quote:
Pay attention to them, Navient likes to reamortize your loan so you are paying the minimum payment. They did it to me twice and I had to go through the painful process of changing my minimum monthly payment. The first time I didn't even realize it until they sent me the notice 2 months later.
That's happened to me as well. I had to reset it at the old level.
Posted on 4/5/17 at 5:52 pm to LSUSUPERSTAR
quote:
Each time you satisfy a bill due, we will automatically advance your next payment due date and your billing statement will indicate a payment is not required for that bill. You may still continue to make payments to decrease your total interest cost and pay your loan off sooner.
My experience with Great Lakes was similar--had a 20 year but I wanted to pay it over 10, they told me they didn't have the option to do that.
Created my own payoff schedule in excel, calculated the 10-year payoff, and found out about a little setting I could do in the online portal to deselect "advance due date" on the excess over their calculated monthly payment and voila--10 year payoff.
I haven't looked at all into re-financing with a private lender. Good credit here, never missed a payment, etc.--anyone know if it's worth it in the current marketplace? Paying ~6% rate right now with 7-ish years left
This post was edited on 4/5/17 at 5:54 pm
Posted on 4/5/17 at 6:38 pm to LSUSPARKY621
Their lowest advertised rate would be 3.375. If you could get that, it would be a nice savings from approx 6 and to me would be worth it
Posted on 4/5/17 at 8:37 pm to LSUFanHouston
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