Consumer complaint received 2025-05-21 00:00:00
Product: Student loan — Federal student loan servicing
Issue: Struggling to repay your loan — Problem with forgiveness, cancellation, or discharge
Company: Nelnet, Inc.
State: TN

Complaint narrative:
On XX/XX/XXXX, I submitted a Borrower Defense Case for discharge of loans due to misconduct and false representation by my school, The Art Institute of XXXX. I submitted all documentation regarding the discharge as proof. 

By XX/XX/XXXX, I received an email from the US Department of Education stating that they reviewed and approved for dept relief and that I was eligible for a full discharge of my loans due to the pervasive and widespread substantial misrepresentations that borrowers relied on to their detriment. 

Then on XX/XX/XXXX, XXXX received paid in full discharge of subsidized and unsubsidized payments. At this time, they were not my service loan provider and I was unsure as to why they were being discharged here since Nelnet was and has been my current loan provider for years. 

Since XX/XX/XXXX, I have gone back and forth with XXXX, US Dept of Ed, and Nelnet trying to understand this discharge process and why XXXX received it vs Nelnet. No one was able to give me full answers for this. 

XX/XX/XXXX, I received another email from the US Department of Education regarding the discharge of my loan confirming the discharge due to the closing of the school as well as the misrepresentations. 

As of XX/XX/XXXX, a loan discharge has been applied to my account on US Dept of ED for said unsubsidized and subsidized loans, but the Borrower defense case Is still open and in processing with nothing happening. 

Now, apparently since these loans are consolidated, A federal court issued an injunction preventing the implementation of the Saving on a Valuable Education ( SAVE ) Plan and parts of other income-driven repayment ( IDR ) plans. As a result, your IDR payment count, and payment history are temporarily unavailable. This injunction has held up the discharge and when I call to find out why, no one is able to give me a full reason as to why even though on my account it is showing discharge pending. 

On another note, when I review my loans on the US Dept of Education website, I have also noticed that apparently, I was awarded an original amount of {$120000.00} in total loans. When I review all the loans given, they do not even add up to that total original amount. At the time, I was unable to finish school due to lack of funds according to the Art institute and had to get private loans, to which I did not do. I am very concerned about this total amount as well and wonder if there was fraud and additional loans were taken out on my behalf that I am unaware of. 

When I called the Dept of Education, no one was able to tell me where that {$120000.00} number is coming from. When I also call Nelnet my loan service provider, they also are not sure where or how that number comes about. 

I am not getting any answers as to why this discharge is taking this long, or as to why the original amount is higher than the actual loans. Can an audit take place on this of where the funds went and how much in total? Should I apply for fraud in my name as well?

Company response to consumer: Closed with explanation