Consumer complaint received 2022-08-28
Company: Nelnet, Inc.
State: NC
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:
My Federal Student Loan ( FFELP ) was transferred to NELNET on or about XX/XX/XXXX while in default and after the COVID pause on federal loan payments had taken effect. NELNET subsequently " reclassified '' my loan as " in repayment '' despite the fact that I had made no payment since XXXX and had never completed a payment schedule that would rescue my loan from default. 
In XXXX of XXXX, NELNET mailed me a debt collection letter demanding I pay {$150.00} in monthly payments. This was the first time I had heard of NELNET. I subsequently learned that the Department of Education had before de-listed them from approved student loan servicers because of their illegal activity ( only to be re-instated later ) and that NELET was the Defendant in an ongoing Class Action Complaint in Nebraska Federal Court. 
Despite the illegal mis-classification of my loan as non-federal and in non-default status, I worked with them to repay what I could. My belief is that NELNET intentionally accepted defaulted loans and illegally reclassified those loans as " private '' or " in repayment '' so as to avoid the federally mandated COVID pause in repayment and deny Income Driven Repayment Plans ( " IDR '' ) capriciously and illegally. 
In fact, NELNET approved a {$0.00} per month IDR after two application from me on XX/XX/XXXX ( see attached ). After approving ( rightly, as I am self-employed, with income that is inconsistent, and does come within {$15000.00} of the average American 's salary ) my IDR, they denied it again. I submitted two more IDR applications that were entirely complete with attached income stubs/statements for both my wife and myself. in the middle of there applications, NELNET approved a one year forbearance, which they subsequently and unilaterally shortened without explanation ( see attached ). I submitted three ( 3 ) email IDR applications and all copies of income were legible ( attached ) and subsequent to their prior approval of same. 
NELNET seems to have no rhyme nor reason to their actions, as I would get letters regularly that contradicted themselves and stated things that were not true, such as " we need a legible copy of your pay stubs '' when they had been printed off the internet and attached to emails I sent them. My wife signed a statement disclosing her income, of which I have a copy, and NELNET claimed she didn't. Random and arbitrary fraud, is when NELNET is engaged in. Placing me in forbearance for a year, then reducing it to a few months was not only fraudulent, but illegally increased my interest, when I should have, and was approved for, an IDR. 
The entire experience with NELNET is why student loan borrowers are so upset, and since most loans are federal, they will ultimately blame the current administration for NELNET 's failings, which is sad. NELNET is acting opposite of the Biden Administration wishes, and should not be allowed to service loans.

Company response to consumer: Closed with explanation