Warren, Merkley, Senators Investigate Federal Student Loan Servicer MOHELA for False Delinquency Notices Allegedly Sent to Borrowers

Warren, Merkley, Senators Investigate Federal Student Loan Servicer MOHELA for False Delinquency Notices Allegedly Sent to Borrowers August 27, 2026 According to reports, MOHELA falsely told borrowers they were thousands of dollars behind on their student loans and nearing default “It is currently unclear how many borrowers received these false notices, whether any borrowers paid the incorrect amounts, and to what extent the issue has been fixed” Text of Letter (PDF) Washington, D.C. — U.S. Senators Elizabeth Warren (D-Mass.) and Jeff Merkley (D-Ore.) led a group of senators in investigating federal student loan servicer MOHELA on the company’s plans to address the false delinquency notices that it reportedly sent to numerous student loan borrowers. Senators Bernie Sanders (I-Vt.), Ranking Member of the Senate Committee on Health, Education, Labor and Pensions, Richard Blumenthal (D-Conn.), Ron Wyden (D-Ore.), Tammy Duckworth (D-Ill.), Mazie Hirono (D-Hawaii), Chris Van Hollen (D-Md.), and Ed Markey (D-Mass.) joined the letter as well. This month, Forbes reported that MOHELA sent a large number of delinquency notices to student loan borrowers not actually delinquent on their loans. The emails mistakenly warned borrowers that their loans were “severely past due” and told borrowers that they were at risk of wage garnishment and other consequences of default. According to reports, borrowers who received these notices and logged into their MOHELA account were incorrectly shown that their loans were past due for many months of payments and shown documents incorrectly indicating that they owed a “past due amount” and “total amount due,” which, in some cases, was over $10,000. MOHELA’s customer service representatives also allegedly failed to speedily resolve this issue for borrowers. “This error is a failure that has not only been highly distressing for borrowers but could have led to direct financial harm,” wrote the senators . “If a borrower does not realize that their false delinquency notice was issued in error and believes that they are on the verge of default, they might make the payment MOHELA has claimed they are responsible for, unnecessarily spending hundreds or even thousands of dollars.” MOHELA has a long history of making significant errors at the expense of borrowers, including allegedly reporting millions of loan transfers to credit bureaus incorrectly, sending inaccurate billing statements to hundreds of thousands of borrowers and late billing statements to millions, and failing to process hundreds of thousands of borrowers’ applications for affordable repayment plans in a timely manner. The senators noted the Trump administration has stripped away key safeguards to prevent federal student loan servicers’ errors. The dismantling of the Education Department (ED) has included the elimination of ED’s entire servicer oversight team, which had been responsible for identifying and addressing servicer errors. “The Trump administration’s policy is to look the other way when servicers fail at their job, and borrowers are suffering the consequences,” wrote the senators . The senators pushed MOHELA to provide answers to their questions regarding these false delinquency notices no later than September 10, 2026. The senators also called on ED to rehire the servicer oversight team and follow the Government Accountability Office’s recommendation to resume assessing servicer accuracy. Senator Warren has led the fight to make our higher education system more affordable, cancel student loan debt, and hold student loan servicers accountable for incompetence and malfeasance. She launched the Save Our Schools campaign in a coordinated effort to fight back against President Trump’s attempts to abolish the Department of Education: On July 30, 2026, the Senate Health, Education, Labor, and Pensions (HELP) Committee’s bipartisan 21-1 vote to advance Senators Elizabeth Warren (D-Mass.) and Bill Cassidy’s (R-La.) College Transparency Act out of committee, Senator Warren released the following statement . On July 21, 2026, Senator Elizabeth Warren (D-Mass.) introduced the Accreditation Reform and Enhanced Accountability Act of 2026 (AREAA) . The legislation would take steps to reduce student debt and protect students and taxpayers by reforming higher education accreditation and centering student outcomes and consumer protection. On July 16, 2026, at a hearing of the Senate Finance Committee , U.S. Senator Elizabeth Warren (D-Mass.) pressed Francis Brooke, nominee to be Deputy Secretary of the Department of the Treasury, to answer basic questions about the largest student loan default crisis in recorded history, which the Treasury Department has now inherited as part of President Trump’s efforts to dismantle the Department of Education. Mr. Brooke was unable to answer questions about the size of the default crisis and potential effects on Social Security benefits for seniors with defaulted loans. On July 6, 2026, in response