My Student Loan Servicer took $560 and kept it for a year
A quick update on last year’s “Giving My Student Loan Servicer a $560 Interest-Free Loan”: they gave me my money back!
#Timeline recap
Here’s the story I covered in my post last year:
- 2024-04-08: I finish paying off my student loans.
- 2024-04-08: Aidvantage processes my monthly autopay despite my loans having a balance of $0, taking an extra $560 from my bank account and leaving me with a negative balance on my loan.
- 2024-04-15: I submit a support request asking for my money back.
- 2024-04-17: Aidvantage responds and says they’ll return the money in 8-12 weeks.
- 2024-06-24: A refund check is created 68 days after my request (I only find out about this after the fact).
- 2024-07-10: I call Aidvantage to ask where my money is. The agent says that a check was sent out and should have arrived. They do not have any proof that a check was sent out. The agent offers to ACH the refund instead, and says it should take 3-4 weeks.
- 2024-08-15: I call Aidvantage to ask where my money is. The agent says that the ACH was never a possibility, because they have to wait for the check they “sent out” to expire. I am informed it takes 14 months for a check to expire and told to call back on August 25th, 2025.
#New developments
At some point after all these interactions, the negative balance on my loan disappeared from the website. Luckily, this didn’t turn out to be a problem, but I wasn’t sure I would be able to convince them that they owed me money if it wasn’t visible in their database.
I recently received a letter from Aidvantage dated July 3rd, 2025 titled “ACTION REQUIRED—YOU MAY BE OWED A REFUND”, asking me to verify my address before a refund check could be created. The letter did not explain how much of a refund I was owed. I called up Aidvantage, verified my address, and they sent me a check. Thankfully, the check actually arrived this time.
On July 25th, 2025, the check for $560 cleared and my student loans are finally, truly complete. If I’d been able to invest that money in the S&P 500 over that period, I would have $714 instead of $560. Unfortunately for me, if you have someone’s routing and account numbers, you can just take $560 from their account and hold on to it interest-free for a year. What are they going to do, consult with a lawyer for $600 an hour?