Paid off loans in full, Mohela mismanaged allocation
Hello all,
I am seeking advice on how to go about rectifying an auto-allocation issue.
I have paid off my loans in full yet I still see a balance on my account. (I worked so hard and sacrificed so much to save up the money to do this and this company is just absolutely denying me from this)
On June 24th, 2025, I made a lump sum payment in the amount of $30,109.22. I selected “auto allocate” so some loans got overpaid while two were not paid at all. It should be noted that this was a system error on Mohela’s part, which they later admitted to me. The total amount owed for my loans was sent to Mohela, and the money was mismanaged.
On July 16th, 2025, I sent a message via Mohela’s messaging portal asking why the funds sent were mismanaged. I was sent an automated response explaining how to pay off outstanding balance. This automated response did not address my question as to why my payment was not allocated to my loans.
On August 8th, 2025, I sent a message via Mohela’s messaging portal asking why the funds sent were mismanaged. I was once again sent a vague automated response explaining how to pay off outstanding balance. This automated response did not address my question as to why my payment was not allocated to my loans and how the issue would be rectified.
On December 12th, 2025, after allowing ample processing time, I contacted Mohela via telephone. I was finally informed by someone that because I chose auto-allocation when paying my loans in full, some loans were overpaid while two of them were not paid at all. They admitted that this was a system error and that they would rectify it. They did not provide me a timeline of when it would get done but they assured me that there would be no more additional interest on the loans.
In early February of 2026 I contacted Mohela again as the loans still show a total balance of $928.71. I requested to speak with a supervisor at this point. The supervisor told me that they had record of my call in December and were unsure why the issue hasn’t been resolved, but that processing could take UP TO 90 days. I explained to her that I made Mohela aware of this in July of 2025, and that this has been going on unresolved for 8 months. The supervisor told me that she would escalate the process so that the issue can be rectified.
All I’m seeking is for them to reflect that my loans are paid off. I want my credit score to go back up and I want to be able to be debt free. I don’t want to have to sue them, or file a complaint. I just want to be rid of having to deal with this hellhole of a company.
Does anyone know how to best go about this or if they’ve had success getting this issue resolved?