I had been repaying my loans thru American Education Services. They put me on a plan in 2019. . I had paid them for 41 straight months of $630 per month, via direct deposit. Thats a total of $25,830.00 they' been paid. In September of 2024, I found outt my loan balance hasn't been going down, over the course of this time. In fact, i now owe $3,000 (plus) more than i did 41 months ago. How is this legal? I know its not ethical. Don't these servicers have an obligation to be ethical? I stopped direct deposit to them and since have a new servicer for my student loans. Dept. of Ed did nothing and said work it out with your service provider. AES, claims they did nothing wrong. I started with over $83,0000 in school loans for a degree from University of Phoenix, which led me nowhere. That degree is useless. Now i just wasted another $25.8k and i to increase my debt by $3000 plus. Anyone have any ideas?
Posted by Several_Meet_9980
9 Comments
It’s probably because your payment is less than the interest rate of the loan. You can easily calculate this if you go look up your loan terms. If you went to the university of phoenix you may qualify for borrowers defense and it may be worth looking into
Call state Attorney General. There were a lot of scams a while back and University of Phoenix is on the list for borrower defense. You should file that.
depends on what plan you are on, standard beats interest, ext standard also should slowly beat interest— ext grad and grad do not beat interest in the beginning leading to more paid over the life of the loan on term based plans.
IDR plans base off income only + family size, they do not take in account interest accrual leading to the possibility that interest will accrue resulting in higher balances. It’s why forgiveness is attached to idr plans.
It’s perfectly legal AND working as intended. The whole goal of schools like that were to fleece students out of as much money as possible. I had similar experiences with ITT-Tech. Useless degree and tons of debt. I did a borrower’s defense application without ANY hope of getting any relief. Luckily most of the loans I had were through the government and those got cancelled after about a term of 2 years. Any private loans I had did not get cancelled. But still about 30g$ was cancelled. So put in the application , you have nothing to lose.
[removed]
Your payment is less than the interest due each month. Therefore, interest accrues while the principal stays untouched.
This happens when your payment is much lower than your standard payment would be.
It’s legal.
You had me with University of Phoenix. I didn’t realize people actually trusted that shit. It’s like ITTech all over again.
And you were paying what they calculated to keep you in good standing, but not enough to cover the interest. All VERY legal and in the paperwork they gave you at the time.
You never checked the terms or balance of your loan. This is 100% on you for being irresponsible.
Wait, you seriously have a loan of $83,0000 for a degree from University of Phoenix? You have been paying basically interest only. Isn’t that an online college only?