Lawmakers allege that a faulty transfer of student loan accounts from NelNet to Mohela in 2023 resulted in millions of credit reporting errors, impacting nearly 2 million borrowers with duplicate records and hundreds of thousands with inaccurate credit scores.
A faulty transfer of student loan accounts from NelNet to Mohela in 2023 led to millions of consumer credit reporting errors, lawmakers say in a new letter to government agencies reviewed by CNBC. The change in loan servicers caused nearly 2 million duplicate student loan records to appear on borrowers' credit reports, and hundreds of thousands of borrowers' credit scores being reported incorrectly for up to a year and a half, according to the letter, which Sen. Elizabeth Warren, D-Mass.
, Ron Wyden, D-Oregon, and other lawmakers sent on Wednesday evening.As part of their investigation, the lawmakers sent inquiries to NelNet, Mohela and three credit reporting companies: Equifax, Experian and Transunion. They asked the companies about what had gone wrong and how many borrowers were impacted. 'We respectfully request that the CFPB and ED use their supervisory and enforcement authority to ensure that the appropriate parties are held accountable for these errors,' the lawmakers wrote. Mohela appears to have failed to inform the credit reporting companies of each loan transfer from NelNet, the lawmakers said they found in their investigation. As a result, many borrowers had their single loan balance reported twice, once by each servicer
Student Loans Credit Reporting Nelnet Mohela Consumer Protection
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Student Loan Transfer Errors Cause Millions of Credit Reporting IssuesLawmakers allege that a transfer of student loan accounts from NelNet to Mohela in 2023 resulted in millions of credit reporting errors, including duplicate records and inaccurate credit scores for borrowers. The letter to government agencies calls for accountability and investigation into the companies involved.
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