The U.S. Department of Education has taken the unusual step of punishing one of the largest federal student loan servicers for failing to send on-time billing statements to 2.5 million borrowers.
The department said on Monday that it would withhold $7.2 million in payment owed to the Higher Education Loan Authority of the State of Missouri, better known as MOHELA, for the month of October. It announced that, of those 2.5 million borrowers, more than 800,000 failed to make an on-time loan payment in October, the first month that payments are due since the pandemic pause began in March 2020.
