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Stuck in limbo between Navient and FedLoan - purchasing a home in the midst

Started by kamonte, April 26, 2017, 01:30:29 pm

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Hi all - I'm hoping to gather some experience/advice from anyone out there on this - I'll try to make it as brief as possible!

I recently began a job that qualifies for PSLF and my employer submitted my forms at the beginning of March. At the same time, I was submitting my paperwork to Navient to renew my IBR (4th year on it). This year was different because I guess the IRS link was down online? So Navient's instructions were a bit dicey and I ended up mailing in the paperwork manually. Long story short, I filled out one part incorrectly and they had me resubmit it after 2 business weeks of processing, with 2 more business weeks to process my new forms.

In the meantime, my loans have now begun the switch to FedLoans. I have talked to Navient reps 4+ times over the past month and Fedloans reps twice, and get a SLIGHTLY different take on it each time. One tells me 30-60 days to switch, another tells me it'll be complete by May 12, but neither side can do anything right now because my loan information is somewhere in la-la-land.

NOW for the tough part - I am in the midst of buying a house. Financing is secured, completed purchase agreement, appraisal is Friday, and closing is scheduled June 6. Because the paperwork for IBR renewal was not completely processed by Navient, they are not sending it along to Fedloans. Fedloans tells me I need to RESUBMIT all paperwork to them after May 12. In the meantime, they are saying my payments are going to triple (from $1,000 to $3,300ish per month - yes, obscene) starting in June because the IBR was not processed.

This is the worst possible timing, because my mortgage lender will be re-pulling my credit in June right before closing. I cannot.. CANNOT.. have Fedloans report a balance of $3,300 for the month of June on my credit report. I was told today that I can call and ask for a supervisor to push the paperwork through ASAP on May 12, but I am still shaking in my boots here that this won't go through in those 2 weeks before June 6th closing.

Any thoughts on another way I can approach this, or is the only solution to hope and wait and cross my fingers that everything can be done very quickly on Fedloan's end?

Thanks for any input!!


I think you might have more problems than that. Even on IBR, your lender will likely use your Standard Plan amount (or the amount required to fully pay off the loan during the 25 year repayment period, or 1% of the loan value). Learn more here: https://thecollegeinvestor.com/5742/reader-question-applying-mortgage-income-based-repayment/