Consumer complaint received 2021-10-06
Company: Nelnet, Inc.
State: CA
Product: Student loan
Sub-product: Federal student loan servicing
Issue: Dealing with your lender or servicer
Sub-issue: Trouble with how payments are being handled

Complaint:
Nelnet is reporting to the credit reporting agencies that accounts ( XXXX, XXXX, XXXX, XXXX, XXXX, XXXX, XXXX ) have late payments. However, they are all associated with proven student loan repayment fraud against me during XXXX and XXXX. I was not late, I was being frauded. This student loan fraud case was prosecuted with the United States Attorneys Office, XXXX California District Number : Case Number XXXX. Again, I was not late, I was being frauded by XXXX which was a fraudulent student loan debt relief scheme found guilty of defrauding me in the court of law. Docket Number:XXXXXXXX. 
Nelnet acknowledged In CFPB complaint number XXXX ( see attached ), that " There are companies looking to profit from student loan borrowers who are unaware their loan servicer can assist with loan management at no cost. Many debt relief or document preparation companies solicit borrowers by offering assistance in applying for repayment, consolidation, or loan forgiveness options in exchange for a fee. We understand the FTC has investigated XXXX, and found fraudulent activity within their organization ''. 
Neltnet in complicit in these violations with a class action lawsuit against Nelnet showing Nelnet violated many federal regulations which exacerbated the problem. 

Most prominent are : - Failure to maintain the borrowers scheduled monthly payment amount and recertify applications timely. 
- Provided unclear information about how to re-enroll in income-driven repayment plans. 
- Failure to process IDR Plan applications timely. 
- Adding interest to principal and thereby increasing the principal owed, driving the interest cost upward contrary to prohibitions against adding interest to the principal balance ( a process called capitalization of interest ). 
- Failure to process applications promptly. 

Ultimately, due to the failures of Nelnet described in the class action lawsuit. I, the borrower, was unaware that Nelnet, the servicer, could assist with loan management at no cost, because Nelnet never provided clear information about how to enroll in income-driven repayment plans, which left me, the borrow, to be preyed upon by fraudulent student debt schemes Furthermore, Nelnet 's reporting data is questionable and needs to be fixed in it's entirety. Nelnet acknowledged In CFPB complaint number XXXX ( see attached ), that they made in errors in reporting my accounts to the credit reporting agencies when they discovered they erroneously furnished data reflecting my loans ( XXXX, XXXX, XXXX and XXXX ) as 120 days past due in XX/XX/XXXX, in addition to these accounts. Nelnet needs to fix the remaining accounts being reported as late. 

Further proof of Nelnet 's inaccuracies were identified in XXXX of XXXX. During COVID forbearance I found that my Nelnet balance increased despite {$83.00} a month being paid through my jobs loan repayment service. How can this be? How during COVID forbearance, and payments still being received By Nelnet, can my balance increase? On XX/XX/XXXX I called Nelnet about discrepancies in the principle balance between XX/XX/XXXX and XX/XX/XXXX. It went up from {$71000.00} to {$72000.00}. During this telephone conversation, Nelnet admitted that they made mistake and applied {$36.00} to my principle balance.

Company response to consumer: Closed with explanation