Consumer complaint received 2023-12-24
Product: Student loan — Federal student loan servicing
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: Nelnet, Inc. (GA)

Institutions subject to CFPB supervisory authority We supervise a range of companies to assess their compliance with federal consumer financial laws.

We have supervisory authority over banks, thrifts, and credit unions with assets over {$10.00} XXXX, as well as their affiliates. In addition, we have supervisory authority over nonbank mortgage originators and servicers, payday lenders, and private student lenders of all sizes. 

The depository institutions and affiliates included in the list below are currently under CFPBs jurisdiction and subject to CFPB supervision and examination. 

We also supervise the larger participants of other consumer financial markets as defined by Bureau rules. To date, this includes larger participants in the following markets : consumer reporting, consumer debt collection, student loan servicing, international money transfer, and automobile financing.

Company failed to provide all necessary elements of a contract with consideration being the number one element. Company didn't put anything up of value. Company mentions in annual financial report that they borrow money from the Department of Treasury. " The Departments liabilities totaled {$1200.00} XXXX as of XX/XX/2023. As shown in Figure 4, most of the Departments liabilities are also associated with loan programs, primarily amounts borrowed from the U.S. Department of the Treasury ( Treasury ) to fund student loans. Debt associated with the XXXX XXXX XXXX totaled {$1100.00} XXXX as of XX/XX/2023. The Department borrows funds to disburse new loans and pay credit program outlays and related costs. The Department repays Treasury after consideration of cash position and the liability for future cash outflows. Total debt increased largely because of new borrowings from Treasury during FY 2023 to fund the disbursement of new loans and downward modifications. '' Page 34 explains this. What this mean is that they used me application/ promissory note and sold it to receive cash. '' Which means they didn't put up anything of value. Meaning they didn't disclose that our signature and application with the promissory note was being used to borrow money. This goes against the meaning of a contract. One essential element of contract is Certainty and Consideration and I was never made aware of this. To be enforceable, a contract must include certain terms, and the ability to fulfill the essential terms of an agreement must be guaranteed. These terms must be clear and unambiguous. There are two essential terms in any agreement : the first one is consideration or price to a bargain ( something of value given in exchange for something else of value. They didn't put up anything of value at all. consideration-XXXX XXXX XXXX Consideration is a promise, performance, or forbearance bargained by a promisor in exchange for their promise. Consideration is the main element of a contract. Without consideration by both parties, a contract can not be enforceable. For instance, if a person used the money to purchase an apple, the apple is the merchants consideration, and the money is the persons consideration. Department of Education didn't put up any consideration. contract-XXXX XXXX XXXXXXXX A contract is an agreement between parties, creating mutual obligations that are enforceable by law. The basic elements required for the agreement to be a legally enforceable contract are : mutual assent, expressed by a valid offer and acceptance ; adequate consideration ; capacity ; and legality. In some states, elements of consideration can be satisfied by a valid substitute. Possible remedies for breach of contract include general damages, consequential damages, reliance damages, and specific performance. Background : Contracts are promises that the law will enforce. Contract law is generally governed by state common law, and while general overall contract law is common throughout the country, some specific court interpretations of a particular element of the contract may vary between the states. If a promise is breached, the law provides remedies to the harmed party, often in the form of monetary damages, or in limited circumstances, in the form of specific performance of the promise made. Elements -- Consideration and Mutual Assent Contracts arise when a duty comes into existence, because of a promise made by one of the parties. To be legally binding as a contract, a promise must be exchanged for adequate consideration. The contract with Department of Education is void ab initio and no debt is owed. It was never a lawful contract from the start. They are in breach of written agreements, use false and misleading advertisements, act without written permission, authorization, and without the alleged borrowers knowledge to transfer actual cash value from the alleged borrower to them and return it as a loan plus interest. They never gave me a loan. I extended my own credit. In their GAAP ( account system ) it shows that the actual cash value shows up like a loan from the borrower to the bank or as a deposit which it is not taxable. So they are committing fraud, tax and securities fraud to be exact and the IRS and SEC will be knowing about this. Case law that supports this is XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX jointly and severally, Case No. XXXX Defendants. XXXX XXXX XXXX Remedies for Breach of Contract -- Damages If the agreement does not meet the legal requirements to be considered a valid contract, the contractual agreement will not be enforced by the law, and the breaching party will not need to indemnify the non-breaching party. That is, the plaintiff ( non-breaching party ) in a contractual dispute suing the breaching party may only win expectation damages when they are able to show that the alleged contractual agreement actually existed and was a valid and enforceable contract. In such a case, expectation damages will be rewarded, which attempts to make the non-breaching party whole, by awarding the amount of money that the party would have made had there not been a breach in the agreement plus any reasonably foreseeable consequential damages suffered as a result of the breach. Also to note is that they sold the debt to Great Lakes and also Nelnet. Once the debt was sold my obligation was paid off anyway. Which means I don't owe anything at all. The debt would have been charged off and I need to be sent a 1099 to file my taxes. If not, I will fill out a IRS 3949a form to report this fraud and audit these accounts. I will also contact the the Office of Inspector General ( OIG ).