Consumer complaint received 2017-11-29
Company: Nelnet, Inc.
State: PA
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with your lender or servicer
Sub-issue: Received bad information about your loan

Complaint:
In summary : My student loans were transferred from XXXX XXXX loan servicing to Nelnet Loan servicing in the summer of XXXX. When Nelnet received the loan, it was not disclosed properly. This disclosure error has led Nelnet to ask me to increase my monthly payment by several hundred dollars per month ( over a 200 % increase ).

Details : Original Nelnet statements from XXXX XXXX attached ) listed my regular payment for Group A Loans at {$53.00} and Group B Loans at {$42.00} ( total of {$96.00} ) monthly. I regularly paid the Group A and Group B payments ( never missing or late ), and have recently begun paying extra on Group B after paying off Group C loans. On XXXX XXXX, XXXX ( after having the loans for over 2 years ), Nelnet contacted me via email stating " As your federal student loan servicer, its our responsibility to periodically review your account to ensure your regular monthly payment amount will allow you to repay your loans within the remaining term established in your loan promissory note. During a recent review of your account, we found that your regular monthly payment amount needs to increase to meet this federal requirement. '' The new loan payment listed in the email was {$500.00} ( an increase of {$410.00} or 426 % ). 

Through a series of phone calls on XXXX XXXX, XXXX XXXX, and XXXX XXXX ( XXXX, XXXX, XXXX? and another person as well ) where I felt I was not being given full, clear, and appropriate information about the reasoning behind this increase ( and quite frankly I 'm still not satisfied with that response as Nelnet continually throws up a " well XXXX XXXX must not have disclosed the loan properly '' response without being able to tell me specifically what the disclosure SHOULD have been at any point behind a nebulous " interest rate changes ... '' reasoning ), I pushed and asked to elevate the matter, and I began doing my own personal investigation. 

On Group A, I owed a total of {$2100.00} according to the initial statement from Nelnet ( attached ) with an interest rate of 2.32 %. On Group B, I owed a total of {$1700.00} with the same interest rate. Taking 30 seconds to plug this information, along with the number of remaining payments, into an amortization calculator ( WHICH NELNET SHOULD HAVE DONE AT THIS POINT IN XXXX ) would tell me what each payment should be. Since the remaining payments information is absolutely nowhere to be found on Nelnet 's site or statements, I went back through my history of information from XXXX XXXX and counted my loan payments made to them ( 93 ). I had 27 monthly payments remaining when Nelnet received my loans. If they had done a simple calculation at this point, the monthly payments should have been {$81.00} and {$65.00}. Instead, as you can see from the attached statements, Nelnet inexplicably asked me to pay {$53.00} and {$42.00}. Because I trusted my loan servicer to be competent and actually able to calculate a simple monthly payment, I regularly paid these amounts. I NEVER incurred late charges or fees, and I expected these amounts to successfully pay off my loans in the appropriate term. Instead, through no fault of my own, I am now in a situation where 2 full years have gone by and with only 3-4 loan payments remaining Nelnet has redisclosed the loan and finally found their initial mistake. Through no fault of my own, I have been underpaying on these loans. Though no fault of my own, my regular payments WILL come up short. Because Nelnet does not include remaining payments information on their statements or website, and because they did not complete their self-proclaimed ( see their email statement, above ) " responsibility to periodically review your account to ensure your regular monthly payment amount will allow you to repay your loans within the remaining term established in your loan promissory note '' I am now being asked to increase my loan payments to {$330.00} per month to cover the shortage that Nelnet created. Had I not been paying extra on Group B recently ( my regular monthly payment has been about {$200.00}, trying to pay {$100.00} more per month ) to attempt to pay down my total debt faster and with less interest, this amount would certainly be higher! 

On XXXX XXXX or XXXX I called back to get more information from the service team leader, XXXX, and to share with her the fact that I had done this investigation on my own. I gave XXXX what I believed to be two equitable solutions : 1. Nelnet could extend my loan terms to allow me to keep paying the regular monthly amount that I SHOULD have been paying all along ( about {$140.00} ). In this event, to prevent paying ADDITIONAL interest above and beyond what I should have paid had Nelnet disclosed the loan correctly upon receipt, I wanted the interest rate to drop to 0 % after the last regular payment in XXXX of XXXX. 
2. If Nelnet could not extend my loan terms, then I proposed that I pay my regular monthly payment that I have been paying ( about {$200.00} per month ), and at the expiration of the loan term in XXXX of XXXX Nelnet would discharge the remaining balance with their own funds to make up for their own errors. 

XXXX agreed to review the account and get back with me in 48-72 hours.

A few days later I received a statement from Nelnet with a {$140.00} payment due. About a week later ( XXXX XXXX ), I received a general email from Nelnet stating that my account was still being reviewed. Over a week after that ( yesterday, XXXX XXXX ) I called Nelnet to check the status. XXXX said that a letter was drafted that I should receive in the mail in the next few days ( even though my next payment is due on Sunday, which I will need to pay by Friday to make timely ), so she agreed to have it emailed. 

I received the attached letter from Nelnet noting that my payments would be {$230.00} on XXXX XXXX, and then 3 additional payments of {$330.00} beginning in XXXX. Nelnet is taking no responsibility whatsoever for their disclosure mistakes ( and yes, the mistakes do at least partially rest with Nelnet as you 'll notice that an interest rate increase in XXXX of XXXX - statement attached - also did not trigger a redisclosure, which again could have rectified the situation in a manner much more palatable than a 200-300 % payment increase ). Even though by Nelnet 's own admission it is THEIR responsibility to periodically review accounts and redisclose them to ensure that payments are correct, Nelnet neglected to take any action for over two years, including after events that should AUTOMATICALLY cause a payment change ( interest rate increase ). Nelnet is taking no corrective action whatsoever to rectify the situation.

Company response to consumer: Closed with explanation