Consumer complaint received 2019-03-13
Company: Nelnet, Inc.
State: PA
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:
XXXX XXXX XXXX XXXX transferred our account to Nelnet, XXXX, Nebraska in XXXX, XXXX. This complaint is about Nelnet, and includes SIX problems to be resolved Note : This loan is in good standing, with no late payments or associated penalties/fees. 

PROBLEM # 1 : 1. InXX/XX/XXXX, we wrote two separate checks to Nelnet ; one to cover the standard payment of {$480.00}, and another one for {$55.00} which was to be directed at XXXX percent toward principal pay down. We intend to start an aggressive pay down of this loan in XX/XX/XXXX, and the {$55.00} payment was a 'test ' payment to insure that it would be properly credited to principal. 
2. Nelnet misappropriated {$46.00} of the {$55.00}, applying {$46.00} to interest rather than principal. 
Solution requested : Apply {$46.00} to principal pay down PROBLEM # 2 : 1. On XX/XX/XXXX, I spoke with Nelnet representative XXXX XXXX regarding the {$46.00} misallocation of payment in XXXX. During our phone conversation, XXXX assured us that she had added clarifying notes to our " permanent record '', stating that any future monies paid in excess of the daily interest rate in effect during the XXXX XXXX day billing period would be applied 100 percent to principal balance pay down. XXXX XXXX suggested that this had not happened in XXXX because the clarifying note was not displayed in our " permanent record ''. This did not happen two weeks after our discussion with XXXX, following our XX/XX/XXXX payment of {$540.00}. 
2. From the XXXX XXXX payment, Nelnet again misallocated money from principal ; {$69.00} that should have been credited to principal pay down was instead applied to interest. 
Solution : Nelnet to credit {$69.00} to principal rather than interest. 

PROBLEM 3 : Nelnet has refused to acknowledge or reply to our original email communications of XX/XX/XXXX, regarding Problems 1 and 2 mentioned above. 
Solution : Nelnet to reply to those particular concerns, without sending a boilerplate reply.

PROBLEM 4 : Nelnet is quick to acknowledge and reply to our XX/XX/XXXX request for payoff quote. Nelnet replied on XX/XX/XXXX with the payoff amount, but did not answer our questions about the process for making the payment : We asked : do we issue two checks - one for principal, one for interest? We asked : should the payments be made by cashier 's check? To where should the checks be mailed? 
Solution : Nelnet to answer our questions about the process for making the payment. 

PROBLEM 5 : As of XX/XX/XXXX, Nelnet has refused to acknowledge or reply to our XX/XX/XXXX re-send of the XX/XX/XXXX email, mentioned in Problem 3, above. 
Solution : Nelnet is to explain why they are not honoring their own clarifying notes, supposedly added to our " permanent record '' by their XXXX XXXX in early XXXX XXXX in which all payments, beyond daily interest rate calculated during their billing period - should be credited to principal paydown. 

PROBLEM 6 : Nelnet is misallocating our money intended for principal pay down, and preventing us from accelerating the pay off this loan. 
As explained to us by XXXX XXXX, ours is not a simple interest loan : the interest will continue to be charged as long as there is a balance on the account. 
Solution : Nelnet to provide specific instructions on how to make accelerated payments against the principal of the account : a. what to write on the check to guarantee it to 100 percent principal pay down b. how to write the check - as a cashier 's check? one for principal? one for interest?

c. where to mail the check. Some lenders actually have a separate mailing address for principal payments.

Company response to consumer: Closed with explanation