Consumer complaint received 2021-05-16
Company: Nelnet, Inc.
State: TN
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:
In XXXX, as a high school freshman, I knew one day I would be a college graduate. Born to parents who struggled financially, no college fund was established for me. Neither of my parents graduated from college, and were ill-equipped or knowledgeable regarding the financial expectations of attending university. If I attended college, I would be responsible for paying for it, and I would eventually use student loans to do so. 

Fast forwarding to XXXX, in a focused effort to improve my overall credit score, I have been working with a financial planner. After reviewing my debts, I was made aware of illicit practices regarding the distribution of payments for my student loan with Nelnet. The overall student loan has been broken into 6 groups, two of which have been paid off. 

* ( Dollar amounts are rounded down, and do not reflect change ) The details of the remaining groups are as follows : Group 1 ) The original loan amount was {$7700.00} issued on XX/XX/XXXX. The current outstanding balance is {$6000.00}. During the history of the loan, {$3300.00} has been paid, with {$2100.00} going to principal, {$1000.00} going towards interest, and {$100.00} going towards fees. The interest rate is 2.43 %, and the daily accrual is {$.00}. This group is categorized as a FFELP Subsidized Stafford Loan. [ See enclosed attachment : pages 2, 5-12 ] Group 2 ) The original loan amount was {$8500.00} issued on XX/XX/XXXX. The current outstanding balance is {$8600.00}. During the history of the loan, {$4300.00} has been paid, with {$2600.00} going to principal, {$1500.00} going towards interest, and {$120.00} going towards fees. The interest rate is 2.43 %, and the daily accrual is {$.00}. This group is categorized as a FFELP Unsubsidized Stafford Loan. [ See enclosed attachment : pages 2, 12-19 ] Group 3 ) The original loan amount was {$6700.00} issued on XX/XX/XXXX. The current outstanding balance is {$7300.00}. During the history of the loan, {$3700.00} has been paid, with {$950.00} going to principal, {$2600.00} going towards interest, and {$120.00} going towards fees. The interest rate is 6.8 %, and the daily accrual is {$1.00}. This group is categorized as a FFELP Subsidized Stafford Loan. [ See enclosed attachment : pages 2, 19-26 ] Group 4 ) The original amount was {$1200.00} issued on XX/XX/XXXX. This loan group has been paid in full ; however, at the termination of the loan, the balance was {$1700.00}. During the history of the loan, {$2500.00} was paid, {$1900.00} going towards principal, {$560.00} going to interest, and {$24.00} going towards fees. The interest rate on this loan was 6.8 %, and the daily accrual was not documented in the historical information provided by Nelnet on XX/XX/XXXX. This group was categorized as a FFELP Unsubsidized Stafford Loan. [ See enclosed attachment : pages 2, 26-32 ] Group 5 ) The original loan amount was {$18000.00} issued on XX/XX/XXXX. The current outstanding balance is {$14000.00}. During the history of the loan, {$5500.00} has been paid, with {$2300.00} going to principal, {$2900.00} going towards interest, and {$170.00} towards fees. The interest rate is 3.5 %, and the daily accrual is {$1.00}. This group is categorized as a FFELP Subsidized Consolidated Loan. [ See enclosed attachment : pages 2, 32-39 ] Group 6 ) The original amount was {$1700.00} issued on XX/XX/XXXX. This loan group has been paid in full. During the history of the loan, {$1300.00} was paid, {$1500.00} going towards principal, {$270.00} going to interest, and {$14.00} going towards fees. The interest rate on this loan was 3.5 %, and the daily accrual was {$.00}. This group was categorized as a FFELP Unsubsidized Consolidated Loan. [ See enclosed attachment : pages 2, 39-46 ] After reviewing my student loan history, I have several complaints I would like to register : 1 ) During the course of my student loan history, I have returned to school, and during my return, I am aware some of my loan groups acquired interest ; however, after I graduated, and returned to paying my student loans, there were on-time payments made and no money was applied to the principal of specific groups. All the money was applied to interest. In fact, some of the student loan groups have experience no principal impact after years of student loan repayments. Even though the repayment plan was later changed to a graduated extended repayment plan, money should have been applied to the principal. Even when an additional payment was made immediately after a regular on-time payment, money was still applied to interest. ( See enclosed attachment : page 45 and 46- Payment made to Group 6 ).

2 ) During the global pandemic beginning XX/XX/XXXX, student loan interest on federal student loans with FFELP were supposed to be suspended ( this was the case with my FFELP loans through Granite State Management Resources ) ; however, Nelnet never suspended the student loan interest. When I called to inquire about canceling the interest, they said these were not federal loans ; on the other hand, when I called in XXXX to negotiate the interest rate, I was told the interest rates are not negotiable because they are federal loans. 

3 ) During the XXXX school year, while working as a full-time teacher in a Title I school, I was denied the Teacher Loan Forgiveness, which according to a loan officer, XXXX, at Nelnet, I qualified. Since that time, thousands of dollars in interest have been accrued. When I inquired why my loan forgiveness was denied, they said because I had a student loan before XX/XX/XXXX ; however, none of my loans were issued before XXXX. 

Previous actions taken : I have reached out to Nelnet on multiple occasions to discuss the acrimonious practices regarding my student loans, and the bad faith and incongruent practices displayed by the company during the history of my student loans. 

It is truly frustrating when there are individuals who intentionally defer their student loan repayments and die still owing the debt ; however, a responsible citizen, like myself, who understands the concept of a promissory note, and repayments is repeatedly diverted to assuage my response.

Company response to consumer: Closed with explanation