A transfer of student loan accounts from Nelnet to Mohela in 2023 resulted in millions of consumer credit reporting errors, according to lawmakers. Nearly 2 million duplicate student loan records appeared on borrowers' credit reports, while hundreds of thousands had their credit scores reported incorrectly for up to a year and a half. Lawmakers are urging the Consumer Financial Protection Bureau (CFPB) and the U.S. Department of Education (ED) to investigate the problems and hold the responsible parties accountable.
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, while hundreds of thousands of borrowers’ credit scores were reported incorrectly for up to a year and a half, according to the letter. Sen. Elizabeth Warren, D-Mass.
Duplicate student loan balances on a borrowers’ credit report can reduce their credit scores and make it more difficult for them to obtain mortgages, car loans and other credit, the lawmakers note in the letter. Nelnet spokesperson Ben Kiser said the issues “arose out of an ED-directed change in servicing requirements,” which “are entirely outside servicers’ control.” Mohela did not immediately respond to a request for comment.
Student Loans Credit Reporting Mohela Nelnet CFPB ED
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Millions of Credit Reporting Errors After Student Loan Transfer, Lawmakers SayA 'faulty' transfer of student loan accounts from NelNet to Mohela in 2023 led to 'millions of consumer credit reporting errors,' according to lawmakers. 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.
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Student loan servicer transfer led to ‘millions of consumer credit reporting errors': LawmakersA “faulty” transfer of student loan accounts from NelNet to Mohela led to “millions of consumer credit reporting errors,” lawmakers say…
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Millions Suffer Credit Reporting Errors After Student Loan TransferLawmakers allege that a faulty transfer of student loan accounts from NelNet to Mohela in 2023 resulted in millions of credit reporting errors. Nearly 2 million duplicate student loan records appeared on borrowers' credit reports, and hundreds of thousands experienced incorrect credit score reporting for up to a year and a half. Sen. Elizabeth Warren, D-Mass., Ron Wyden, D-Oregon, and other lawmakers are calling for investigations into the companies involved.
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Millions of Credit Reporting Errors Linked to Student Loan TransferLawmakers allege that a faulty transfer of student loan accounts from NelNet to Mohela in 2023 resulted in millions of credit reporting errors. The transfer led to nearly 2 million duplicate student loan records appearing on borrowers' credit reports and hundreds of thousands experiencing incorrect credit scores for up to 18 months.
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Student Loan Transfer Errors Caused Millions of Credit Reporting IssuesA transfer of student loan accounts from NelNet to Mohela in 2023 resulted in millions of credit reporting errors, including duplicate records and incorrect credit scores.
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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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