Consumer complaint received 2025-04-07 00:00:00
Product: Student loan — Private student loan
Issue: Incorrect information on your report — Account information incorrect
Company: Nelnet, Inc.
State: MD

Complaint narrative:
XX/XX/XXXX Consumer Financial Protection Bureau XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXXXXXX Re : Formal Complaint Request to Remove Two Inaccurate Late Payments from Credit Reports ( XXXX XXXX XXXXXXXX ) To Whom It May Concern : I am writing to lodge a formal complaint with the Consumer Financial Protection Bureau and to request urgent assistance regarding inaccurate and unfair credit reporting on my student loan account. Specifically, I seek the removal of two late payment entries ( for XX/XX/XXXX and XX/XX/XXXX ) that currently appear on my credit reports with XXXX, XXXX, and XXXX. These derogatory marks pertain to a XXXXXXXX XXXX  student loan that was sold/transferred to Firstmark Services during the exact period when I was incapacitated by a critical medical hardship. I believe the continued reporting of these late payments is unjust, misleading, and not in compliance with the Fair Credit Reporting Act ( FCRA ) given the circumstances outlined below. 

From XX/XX/XXXX through XX/XX/XXXX, I was critically ill and hospitalized for extended periods, including time in an intensive care unit ( ICU ) and a subsequent psychiatric hospitalization. This was an XXXX XXXX XXXX XXXX that left me with no ability to manage my personal or financial affairs during those months. Naturally, I could not pay bills or even stay informed about my accounts while XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX My prolonged hospitalization was entirely unplanned and beyond my control a situation no one anticipates, and XXXX that made it impossible to meet normal financial obligations. 

Unbeknownst to me at the time, while I was XXXX XXXX XXXXXXXX sold my student loan to XXXX XXXX  ( the transfer occurred sometime in late XXXX ). Because of my medical incapacitation, I did not receive or comprehend any communications about this loan transfer. I was not checking mail or email while hospitalized, and any notification from XXXX or XXXX about a new account number, payment portal, or due date went unnoticed. As a result, I had no knowledge that my loan payments were now owed to a different servicer. In practical terms, this meant the XX/XX/XXXX and XX/XX/XXXX payments went unpaid not out of neglect or refusal, but because I literally did not know where or to whom payment was due, nor was I in any condition to make payments during that timeframe. 

By early XX/XX/XXXX, I had recovered enough to begin managing my finances again. Upon reviewing my accounts, I was alarmed to discover that my student loan was marked past due specifically, the XX/XX/XXXX and XX/XX/XXXX payments were reported as late. This was the first time I became aware that XXXX was now the loan holder and that the loan had effectively fallen into delinquency during my illness. I immediately contacted XXXX XXXX as soon as I learned of the issue, desperate to explain the situation and resolve any problems. I informed XXXX that I had been critically ill and unaware of the transfer, and that the missed payments were a direct result of these extraordinary circumstances. 

During my call with XXXX, a supervisory representative acknowledged the situation and the confusion arising from the loans transfer. The supervisor noted that many customers had experienced similar issues when XXXX took over loans from XXXX, indicating this was a known problem. I explained that I had been hospitalized and unable to receive notices or make payments. The supervisor was sympathetic and apologized for the difficulties I faced. Most importantly, XXXX supervisor explicitly promised that the two late payments ( XX/XX/XXXX and XX/XX/XXXX ) would be removed from my credit reports given the extenuating circumstances. I was reassured that my situation was understood and that the credit reporting would be corrected as a courtesy and in recognition of the hardship I endured. 

In addition to promising removal of the negative marks, XXXX approved me for its XXXX XXXX XXXX XXXX to help me get back on track. I was enrolled in a XXXX modified payment plan which substantially reduced my monthly payments for the next year ( initially to roughly 50 % of the normal payment, and later to 75 % ). I promptly accepted this modification plan and have abided by its terms since XX/XX/XXXX. This accommodation not only provided financial relief as I recovered, but it also demonstrates my good-faith effort to resolve the account once I regained the capacity to do so. The fact that XXXX offered and approved this program for me underscores that they recognized my hardship as legitimate. ( I have obtained a letter from XXXX dated XX/XX/XXXX confirming my enrollment in the modification program, and I am attaching a copy of this letter to support my claim. ) However, despite XXXX assurances, the late payments for XX/XX/XXXX and XX/XX/XXXX continue to appear on all three of my credit reports as of the date of this letter. These two derogatory marks have substantially lowered my credit score and are impeding my ability to move forward financially ( for example, The presence of these late payments on my credit report has significantly hindered my ability to rent an apartment. Many landlords and property management companies review applicants ' credit histories, and negative marks such as late payments can lead to application denials or require additional security deposits. This has made the process of finding suitable housing exceedingly challenging ). More importantly, the presence of these late payments presents an incomplete and misleading narrative of my credit history. Any reviewer of my credit report sees a XXXX delinquency, but sees none of the context behind it. I feel I was misled by the servicer into believing this issue would be fixed promptly, yet months later the harmful credit reporting remains. In its current state, my credit report does not accurately reflect my creditworthiness or intentions it instead reflects a breakdown in communication during a XXXX XXXX 

I contend that the continued reporting of these two late payments is not only unfair, but also in violation of the Fair Credit Reporting Act. The FCRAs fundamental purpose is to ensure fair and accurate credit reporting, as XXXX declared in its findings. In fact, XXXX noted that inaccurate credit reports directly impair the efficiency of the banking system, and unfair credit reporting methods undermine the public confidence. In line with this purpose, the FCRA imposes a duty on companies that furnish information to credit bureaus to report data that is truthful, accurate, and not misleading. Under Section 623 of the FCRA ( 15 U.S.C. 1681s-2 ), a furnisher must not report information it knows or has reason to believe is inaccurate. Once I notified XXXX of the errors and my extraordinary situation, they had more than enough reason to believe the prior negative reporting was incorrect or at least contextually wrong. Continuing to report those late payments despite the clear evidence of my medical emergency and XXXX own acknowledgment of confusion appears to be a direct breach of their obligations under the FCRA. Furthermore, the FCRAs reinvestigation provisions ( Section 611, 15 U.S.C. 1681i, and corresponding furnisher duties in 1681s-2 ( b ) ) require that if an investigation finds information to be incomplete or inaccurate, that information must be promptly corrected or deleted so it does not continue to mislead. In this case, the reporting of these late payments without any notation of the circumstances is incomplete and thus inaccurate in effect, and it should have been corrected by removing the late payment entries as soon as the situation was explained. 

In addition, I want to emphasize that even if one were to argue the late payment notations are factually true in isolation ( i.e. a payment due in XXXX was marked late in XXXX ), the context renders them materially misleading. Courts have held that a credit entry can be technically accurate yet still violate the FCRA if it creates a misleading impression about a consumers creditworthiness. In other words, information that is misleading in such a way and to such an extent that it can be expected to adversely affect credit decisions is considered inaccurate under the FCRA. Here, the reporting of a XXXX delinquency ( December 2024January 2025 ) on my loan creates a severely misleading impression : it suggests that I simply failed to pay my debt for two months, when in reality I was fighting for my life in the hospital and was never even aware of the need to pay a different servicer. Any lender or creditor viewing my report would draw the false conclusion that I was financially irresponsible during that period, which is absolutely not the case. This kind of omission of critical context is materially misleading by any measure, as it hides the true cause of the delinquency. I firmly believe that the current credit reporting on my loan is exactly the sort of unjust outcome the FCRA was designed to prevent. For the credit reporting system to be fair, it must take into account situations like mine and avoid penalizing a consumer for circumstances wholly outside their control. 

Moreover, CFPBs own guidance to furnishers and creditors encourages a flexible and empathetic approach in scenarios where consumers face serious hardships or life-altering events. During the XXXX pandemic, for example, the CFPB underscored that consumers benefit when lenders are flexible with payment accommodations and report those accommodations accurately ( rather than reporting the loans as delinquent ). The XXXX explicitly encourages lenders to continue to voluntarily provide payment relief to consumers and to report accurate information to credit bureaus relating to this relief. In other words, regulators expect furnishers to work constructively with borrowers in hardship and to ensure that credit reporting reflects any relief measures or agreements in place, instead of unfairly punishing the consumers credit record. While my situation was a personal medical crisis rather than a global pandemic, the underlying principle remains the same. I acted in good faith by promptly communicating and cooperating with my loan servicer once I was able, and the servicer in turn had a responsibility to handle my account with appropriate care and accuracy. Furnishers are expected to exercise discretion and not report derogatory information in a manner that misrepresents the consumers circumstances. In my case, rather than rigidly reporting two missed payments caused by a documented medical incapacity, the servicer should have taken the promised corrective action to ensure my credit report stayed accurate and fair. Failing to do so goes against both the letter and spirit of CFPBs guidance on credit reporting in the face of hardships. 

Requested Resolution : I respectfully request that the CFPB assist me in having the XX/XX/XXXX and XX/XX/XXXX late payment entries removed from my credit reports with XXXX, XXXX, and XXXX. This adjustment is necessary to bring my credit profile back into alignment with the true facts and the FCRAs standards of accuracy. Given the circumstances detailed above my severe illness, the confusion surrounding the loans transfer, and XXXX own indication that the reporting would be fixed I believe that the removal of these derogatory marks is both warranted and urgently needed. I have already attempted to resolve this directly with the servicer ; however, since the issue remains unresolved despite their promises, I am turning to the CFPBs intervention. I am asking the XXXX to enforce my rights under federal law by ensuring that the furnishers involved ( XXXX  ) XXXX the information they are providing to the credit bureaus. In practical terms, this means updating my credit files so that no late payment is reported for XX/XX/XXXX and XX/XX/XXXX ( the months in question should have no negative mark at all ). This outcome will correct the record to accurately reflect my credit history and restore my good standing. I would appreciate confirmation once these late payments have been deleted across all three bureaus, and I welcome any other guidance the CFPB can provide in preventing such issues from harming consumers in the future. 

Supporting Documentation : To further support my claim, I have attached a copy of a letter from XXXX XXXX ( dated XX/XX/XXXX ) confirming my approval for the Student Loan Modification Program. This letter serves as evidence that XXXX acknowledged my situation and took steps to accommodate my hardship. It validates that I was actively working with the servicer in good faith and that they were aware of my medical issues. I believe this document, in conjunction with the explanation above, clearly illustrates that the negative credit reporting was an oversight that should have been rectified. Should you require any additional documentation, I am ready to provide hospital discharge papers, doctors letters, or any records necessary to substantiate the timeline and severity of my illness. My goal is simply to ensure my credit report is complete and accurate, as the law requires, and that I am not unfairly penalized for an event beyond my control. 

Thank you very much for your time and consideration of this complaint. I trust that the CFPB will investigate this matter thoroughly and use its good offices to uphold the protections afforded to consumers under the FCRA. I have been a responsible borrower, and I hope that with the XXXX help, my credit reports will soon be corrected to remove any misleading information related to this incident. Please do not hesitate to contact me if any further information is needed. I look forward to a prompt and fair resolution of this issue so that I can put this difficult chapter behind me and rebuild my financial standing on accurate information. 

Sincerely, XXXX XXXX XXXX

Company response to consumer: Closed with explanation