Consumer complaint received 2020-11-06
Company: Nelnet, Inc.
State: LA
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:
On XX/XX/XXXX I noticed that four payments and part of a fifth payment were strictly applied to interest. I have been consistently paying on this loan, one loan number XXXX XXXX, and normally interest payments are {$50.00}. My minimum payment is {$250.00}. and i normally pay XXXX {$400.00}. on XX/XX/XXXX, XX/XX/XXXX, XX/XX/XXXX, XX/XX/XXXX, XXXX I paid {$400.00}, {$450.00}, {$400.00}, {$400.00}, {$600.00} respectively. All but {$180.00} was applied to interest. Loan details include one account when I login to the website, Nelnet.com, when I select the account number it populates Group AA total loan amount and then has loan 1 and loan 2 with a breakdown of the individual balances. all other information is the same. The interest rate listed in all areas is the same rate. I have emailed and called the company with the below being the last exchange From : XXXX XXXX XXXX Date : XX/XX/XXXX at XXXX XXXX  CST To : XXXX  Subject : Re : Nelnet-Encrypted- Message ( Correspondence Request ) Why did this payment allocation change dispute neither loan being paid in full? I would like a payment history and loan balance history provided that details the accumulated interest and what determined the reallocation of interest payments. Both loans have the same interest rate so your explanation below does not explain this. 
Sent from my XXXX On XX/XX/XXXX, at XXXX XXXX, XXXX wrote : Account Number : XXXX Dear XXXX XXXX, Thank you for contacting Nelnet Attached is a copy of the document you requested. 

If you have signed up for auto debit and have set up an alternative payment amount ( you are paying more than the minimum monthly payment amount ), your payment will be applied as follows : Paying More Than Your Current Amount Due : Unless you direct your payment to an individual loan or group, the standard allocation method is as follows. After your current amount due is paid, payments are allocated across loans in repayment status starting with the highest interest rate. Once the loans in repayment status with the highest interest rate are paid in full, any remaining payment amount will be allocated across the loans with the next highest interest rate. If two or more loans in repayment status have the same highest interest rate, the payment will be allocated first to the unsubsidized loans and then to the subsidized loans, in proportion to each loans regular monthly payment amount. 

When you pay more than your current amount due, your due date on loan groups in repayment status will advance by one month each time you satisfy the regular monthly payment amount for that group. Your monthly billing statement will show {$0.00} due for that loan group. 

Since your excess payment will continue to be applied to the loan group starting with the highest interest rate, you will continue to have an amount due for loan groups with lower interest rates. 
You have the option to request that we not advance your due date when you pay more than your current amount due. 
If you want your excess payment to continue to advance the due date of all of your loan groups in repayment status, you can direct your excess payments to all loan groups in repayment status, instead of targeting the loan group ( s ) with the highest interest rate, as a one-time or recurring special payment instruction. This will help keep the due dates for all loan groups aligned. 

If you would like to have standing special payment instructions applied to your account please email us at XXXX. Make sure to specify if you would like to keep your due date from advancing with an overpayment, and whether you would like to have overpayments applied to a specific loan or group. 


Were here for you when you need us. If you have any questions, please call us at XXXX or visit Nelnet.com. 


I requested the TILA and opening account disclosures on XX/XX/XXXX but they were not provided. The online statements and account summary is not clear and conscious and this has absolutely resulted in consumer harm. 

Thank you for your attention to this matter.

Company response to consumer: Closed with explanation