SACRAMENTO – California Attorney General Xavier Becerra has issued a consumer alert following news that federal grants awarded to some prospective teachers have been wrongly converted to loans that must be repaid with interest.

The Teacher Education Assistance for College and Higher Education (TEACH) grant program is run by the U.S. Department of Education and provides up to $4,000 per year for students who intend to become teachers of a high-need field in a low-income area.

Grant recipients must agree to teach full-time for four years and submit documentation of their service to the U.S. Department of Education. Last year, 3,822 students in California received TEACH grants.

Many teachers have found that their TEACH grants have been converted to loans even though they have fulfilled the requirements of the grant program.

Small clerical mistakes, such as a missing signature or date, or a delay in processing paperwork by the servicer, have resulted in grants being converted to thousands of dollars of loans, which must be repaid with interest.

Teachers have reported difficulties in getting these mistakes corrected. After receiving complaints, the U.S. Department of Education announced last week that it is now reviewing the grant program.

“With the TEACH program, the U.S. Department of Education had one job: to provide grants to those who commit to public service by teaching in some of our most underserved communities. Sadly, Education Secretary Betsy DeVos has failed yet another test,” said Attorney General Becerra. “We can’t let Secretary DeVos’ failures discourage aspiring teachers from achieving their dream. The California Department of Justice urges all TEACH grant recipients who have been wronged to know your rights.”

If you believe that your TEACH grant has been incorrectly converted into a loan, you may take the following steps to appeal your case:

First, appeal through your student loan servicer (FedLoan Servicing) by calling 1-888-699-2908, or by sending a secure email through your online account at https://myfedloan.org . Keep notes about your conversation, including with whom you speak and the answers and instructions that you receive.

If FedLoan Servicing denies your appeal, call the Department of Education’s Student Aid Ombudsman at 1-877-557-2575, contact the Department of Education online at https://feedback.studentaid.ed.gov/, or write to U.S. Department of Education, FSA Ombudsman Group, P.O. Box 1843, Monticello, KY 42633.

You can also file a complaint with the Consumer Financial Protection Bureau at https://www.consumerfinance.gov/complaint.

Californians may also contact CA DOJ’s Public Inquiry Unit at 1-800-952-5225 for information on the actions they should take to correct the treatment of their grant.