July 08, 2016
July 8, 2016
To: Nelnet Education Loan Servicing, The U.S. Department of Education, the FSA Ombudsman Group , and the Better Business Bureau of Nebraska
CC: Loretta Lynch, Barbara Lee, Barbara Boxer, Dianne Feinstein, and Barack Obama
BCC: The Nervous Breakdown
From: Ariel Gore, Oakland, CA
I am writing to make a formal complaint against Nelnet Education Loan Servicing and, by extension, the U.S. Department of Education that empowers them, for a pattern of willful incompetence that I believe amounts to fraud.
I entered college as a young single mom in 1990. I was told that an education was the road out of poverty. I did not take out any private loans. I took out the maximum government student loans recommended to me, and was assured they were reasonable based on the educational products that were being sold to me. Those loans amounted to less than $40,000. I did well in school and graduated from Mills College with honors in 1994. Instead of studying creative writing at the graduate level, I opted for a more “practical” master’s program in journalism and graduated from the University of California at Berkeley in 1996. I have been on an Income-Contingent / Income-Based Repayment Plan since 2002 and have always made the required payments on time.
Last month, Nelnet told me they had recalculated my payment to $744 per month for the year for the loans that they service. (I pay an additional $155 monthly to Navient, $206 monthly to American Education Services, etc.) When I went to make my $744 payment online yesterday, I saw that they had changed that monthly figure to $1,222 based on a sudden decision to include my spouse’s income in their calculation, something that they didn’t do last year, repeatedly assured me they would never do, and now tell me they have always done.
I earned $900 a month last year. This is about average for a writer in this country. When I was an adjunct English professor, I earned even less. This is the career I was educated for. I work full time.
According to the Author’s Guild, writer incomes are down 30 percent in just the last six years, so my poverty status is not a personal or professional failure but rather an industry-wide phenomenon based on the cultural devaluation of my labor.
Nelnet’s sudden change in policy is just the latest sudden and unexplained move in a long history of sudden and unexplained moves by Nelnet in particular and by other various servicing companies empowered by the U.S. Department of Education that I have dealt with over the past quarter century.
Nelnet refuses to communicate in writing and their agents refuse to give me their full names and refuse to give confirmation numbers for actions they claim to be taking, so the endless misinformation and contradictory statements of policy are undocumentable.
Agents give me made-up tax advice, one threatened to take my belongings (despite the fact that I have never made a late payment), and many try to trick me into various “help” schemes that will ultimately increase my indebtedness.
Nelnet has reset my loan forgiveness date, repeatedly changed their story about how their Income-Contingent or Income-Based figures are calculated, told me off and on that the Income-Contingent and Income-Based programs are the same thing or different, wasted hours of my time trying to sell me financial products they realize at the last minute I’m too old to qualify for, and lied to me about the financial consequence of getting married.
I never signed up to deal with Nelnet and I do not want to be in business with them.
I have been making on-time payments since at least 2002, so this is not a case of a deadbeat.
I have never been in default.
I am not interested in any solution that will trigger a compounding of interest, a resetting of the “forgiveness” date, an extension of the payment period, or anything else that will result in the government profiting from my poverty any more than it is already poised to.
I am now being penalized for being married. When I talked to Nelnet before I got married in 2014, they guaranteed me that this would not happen and that if I included a letter that my spouse was not responsible for my loan in my annual recalculation, her income would not be counted in the Income-Contingent or Income-Based plan. There is precedence for this in other government financial calculations, such as calculating child support based on one spouse’s income and not the stepparent’s.
My spouse did not graduate from college and took out no student loans and never agreed to take mine on and is now expected to contribute fully one third of her take-home pay to my loans. She is over 50 years old and neither of us have health insurance. How could we afford health insurance?
I would not like to get a divorce, but the government is forcing me to choose between my marriage and my ability to feed my 8-year-old child.
When I asked the Nelnet “team leader” if there was anything to do about this besides get a divorce, he began lecturing me about all the money I would lose by giving up my “married filing jointly” status. This is unethical because he is not a tax professional. If he was a tax professional or knew anything about U.S. tax law, he would know that “head of household” is in fact a more beneficial tax filing status than “married filing jointly.” His tax scare tactics were, however, in line with the way Nelnet makes a habit of talking to me—peddling misinformation with the obvious goal of profiting off my gullibility, poverty, and distress.
The last time I spoke to a Nelnet agent, her answers seemed so unconnected to my questions, it was as if she were typing key words into an answer-generator not unlike Siri.
I am being held to all my promises with regard to these loans, including promises made because I was lied to as a young single mother. The government has not held themselves to the same standards and instead used their “servicing companies” to lie to me, change their policies, and change their stories time after time always with the result of increased profits for them. When mistakes are made, they are never in my favor and the new agents—who still won’t say their name—say they “can only help you moving forward, we can’t do anything about the past.”
I have repaid the government for going to college twice over by now, and I remain an indentured servant with an indebtedness that continues to snowball at 8.5% interest—currently about $17,000 per year compounded annually.
When Nelnet took over servicing my loans in 2012, they reset the forgiveness date to the date they took the loans, and later told me that they had behaved within the law in doing so as they briefly grouped my original student loans in with the parent loans I took to help my daughter go to college, giving me a short-term “in-school deferment” and thereby erasing my previous 10 years of on-time payments. I wouldn’t have taken out parent loans for my daughter if I had known doing that would in effect add another $100,000 to my own loan burden. I was simply trying to help her avoid the lifetime of indentured servitude that my own education has resulted in.
Nelnet agents have also given me a number of different stories as to why they reset my forgiveness date including denying that it has been reset at all one day and then insisting that it has indeed been reset the next.
I borrowed less than 40,000 to go to school. I have been making the asked-for payments my entire adult life. I am 46 years old. My loans have now snowballed to over $120,000 for myself and an additional $60,000+ for helping send my daughter to college.
The only solution Nelnet offers me includes capitalizing the interest in a new way so that the government can profit at least an additional $100,000 via these predatory loans.
I believe all of this is unethical at best.
My loan balances should be cancelled based on money already paid by me and the emotional distress of having to deal with Nelnet.
I look forward to a confirmation of the cancellation of my loans.
Failing that, please fix all records to reflect that I have made on-time payment in an income-contingent or income-based program since 2002 and never agreed to be switched from one program to the other, therefore my loans are 14 years into the forgiveness period, which should not have been interrupted or changed in any way when Nelnet took over as the servicer, adjust my monthly payments so that my spouse’s income is not included when calculating my payments, assign me to a different servicing center—anyone but Nelnet—and advise your agents to just admit they have not read the manual and they have no authority anyway.