Any experts, please advise what I should do, who to contact, etc.

Some background:

1. In college, I had to take out a private alternative loan called the Choice loan from Nelnet. Interest rate was 16% APR (I know, I was desperate).

2. In Dec. of 2007, I consolidated the entire nelnet loan with another lender. Payoff amount was $40k

3. I found out a few weeks ago that Nelnet assessed a "loan servicing fee" of nearly $4,000 even though I had consolidated my loan with ANOTHER LENDER

4. So now, I still owe Nelnet that amount, and interest is being accrued daily at 16%...who can I report this to?

Origination fees are common when you consolidte private loans. You have to read the terms carefully. Nothing you can do about it.

A transcript of my conversation with a Nelnet CSR:


10:38:55 AM
System Welcome
10:38:55 AM
System Connecting to server. Please wait...
10:38:56 AM
System Connected to ehelp.nelnet.net
10:38:56 AM
System Session ID: 205677
10:38:57 AM
System Initial Question/Comment: account inquiry
10:39:00 AM
System Randy Harmdierks has joined this session!
10:39:04 AM
Randy Harmdierks Thank you for contacting Nelnet, my name is Randy and I will be helping you reach your goals today. Please be advised this chat is being recorded and may be retrieved for quality assurance, training, and follow-up purposes.
10:39:10 AM
Randy Harmdierks How may I help you?
10:39:11 AM
You Hi
10:39:38 AM
You can you please provide me all the names and addresses of your executive members
10:39:48 AM
You CEO, Senior Vice Presidents
10:40:03 AM
You CFO, and maybe VP of customer service?
10:40:28 AM
You I am having an issue with your company and I want to bring it to their attention since no one at nelnet seems to be helping me
10:41:49 AM
Randy Harmdierks I would be happy to assist you with your issue, but I will not be disclosing the information you are requesting.
10:42:35 AM
You ???
10:42:35 AM
Randy Harmdierks May I help you with your issue?
10:42:38 AM
You is there a reason?
10:42:55 AM
You i just need the names of your ceo, and vice presidents
10:43:12 AM
You what is that, classified information?
10:43:16 AM
You my god
10:44:46 AM
Randy Harmdierks If you want further information on our corporate structure, please visit www.nelnet.com. I am equipped to assist you with any issues with your account. Is there an issue with your account that I can assist you with?
10:45:05 AM
You tell me about loan servicing fees
10:46:06 AM
Randy Harmdierks Were you assessed fees?
10:47:13 AM
You yes
10:47:23 AM
You even though I consolidated with another company
10:47:41 AM
You and let me tell you, i took out an alternative private loan called the choice loan
10:47:50 AM
You while i was in college
10:47:57 AM
Randy Harmdierks I will need to review your account to be of more assistance.
10:48:01 AM
Randy Harmdierks May I ask you a few questions for identification purposes?
10:48:16 AM
You the choice loan was 16% apr
10:48:39 AM
You i feel like im being punished for 1) paying off my loan and 2) consolidating with another lender
10:49:14 AM
You what information do you need?
10:49:21 AM
Randy Harmdierks Nelnet takes the security of your personal information very seriously. To help us protect your information, do not offer your Social Security Number during this chat.

May I please have your first and last name, mailing address, phone number, and e-mail address that we have on file?
10:49:31 AM
You as the previous rep i talked to said there's nothing he can do about waiving the fees
10:50:22 AM
You very well:
10:51:01 AM
Randy Harmdierks It will be just one moment while I access your account.
10:52:47 AM
You ok. i hope you can help me. i am fuming.
10:53:34 AM
Randy Harmdierks I have your account in front of me. It will take me a few minutes to review your account to determine what is going on. Please hold.
10:58:46 AM
You are you done reviewing my account?
10:59:36 AM
Randy Harmdierks it appears you contacted us on 1/22/08. At that time, a research request was placed on your account. According to the notes, this is still in research. You will be contacted when the research is complete.
11:00:21 AM
You i was contacted today....
11:00:33 AM
You and was told the fees will not be waived completely
11:02:19 AM
You also, i want you to look into my account history. online, it is showing i took out the original loan amount of $28,170.00, with capitalize interest of $9,518.80. this totals to $37,688.80.
11:02:31 AM
You now i had sent in a pay off amount of $40,000
11:02:38 AM
You this should have covered everything
11:06:49 AM
Randy Harmdierks Let me send you a detailed payment history. It will line out everything. As far as the repayment fees, I'm looking at the types of private loans you have, and these fees seem to be based on the loans themselves (meaning these fees would be assessed for early repayment on the loans no matter who the lender).
11:07:27 AM
You that is ridiculous
11:07:37 AM
You so im being punished for paying off my loan?
11:07:49 AM
Randy Harmdierks I apologize, but Nelnet did not set the terms for those loans.
11:07:52 AM
You maybe i shouldnt have paid back my loan at all?
11:08:08 AM
You declaring bankruptcy would have been better
11:08:26 AM
Randy Harmdierks Would you like the payment history e-mailed to you. I can have it out to you in the next half hour.
11:08:44 AM
You basically, you are adding the fees on because I didnt consolidate with your company
11:09:18 AM
Randy Harmdierks No.
11:09:54 AM
You that is unfair practice...i wonder what the student loan regulatory agency would say about this
11:10:06 AM
Randy Harmdierks Nelnet did not write the terms and agreements for that type of private loan. It would have been assessed no matter who your lender. It would have been assessed for early payment even if you consolidated with Nelnet.
11:10:23 AM
Randy Harmdierks There are no early repayment penalties on federal loans.
11:10:58 AM
You i took out another private loan with a different lender and there isnt an early repayment fee
11:11:09 AM
Randy Harmdierks I'm trying to help you, but you're not listening.
11:11:19 AM
You you know I was paying 16% interest...
11:11:28 AM
You you're not understanding my concern here
11:12:45 AM
Randy Harmdierks those are the terms of those loans. Many companies charge early payment penalties on private loans (whether for student loans or cars or houses, etc.) Those were the terms when you signed your agreement for the loans.
11:13:12 AM
You yes, understandable, but I made a $40,000 payment
11:13:23 AM
You cant you, in good faith, do something?
11:13:52 AM
Randy Harmdierks It's great that you were able to make that kind of a payment, but that's the point. That is early repayment.
11:14:08 AM
You i mean if I defaulted on the loans, then I can expect late fees and such to be added on and I wont complain about it, but this comes down to an ethical level---of horrible business practices
11:14:27 AM
You you are punishing me for trying to pay off a BAD loan to start with?
11:14:40 AM
You as I mentioned, the loan was 16% APR
11:14:59 AM
You what, you want me to spend the next 10 years paying a 37k loan @ 16 APR
11:15:05 AM
You at that rate i will never pay it off
11:15:55 AM
Randy Harmdierks you signed an agreement for the loan. Part of the agreement is that you had read and understood the terms. It is your responsibility to know the terms before you sign for the loan.
11:17:03 AM
You hey, let me ask you, how did you pay for your college tuition?
11:17:11 AM
You parents, scholarships, grants, loans?
11:17:30 AM
Randy Harmdierks All of the above, and I'll be paying for it for the next 20 years.
11:17:57 AM
You my tuition was $35k/year, and with all the federal financial aids, they weren’t enough, so I had no other option but to accept a bad loan
11:18:47 AM
Randy Harmdierks no company could stay in business if they didn't hold their clients accountable for the signed agreements.
11:19:06 AM
You well in this case, it's the one time you should
11:20:02 AM
Randy Harmdierks I understand your frustration, but we're going in circles.
11:20:13 AM
You well, bring it up to someone else man
11:20:18 AM
You to your supervisor
11:20:21 AM
You to an executive
11:20:37 AM
You i want their opinion...i want, for once, for someone to look past the fine print
11:20:43 AM
You and all the damn legalese
11:22:09 AM
Randy Harmdierks Nelnet makes every effort to assist their customers with any issues that arise. The bottom line is, you knew the terms, you made the payment, the fees were assessed.
11:22:24 AM
You i did not know the terms
11:22:58 AM
You and i was told that the fees were assessed BEFORE i made the payment
11:23:02 AM
You can you explain that?
11:24:05 AM
Randy Harmdierks You misunderstood. When a payment is received, it is first applied to fees, then interest, then principal. They weren't assessed before your payment, the were the first thing taken from your payment.
11:25:12 AM
You no, the first rep told me the fees were assessed in nOVEMBER
11:25:21 AM
You i made the payment in dec
11:25:31 AM
You dont you know anything?
11:27:45 AM
Randy Harmdierks I do not see any fees being assessed in November. Some interest capitalized when your loans entered repayment in November. That is common practice for all student loans.
11:28:38 AM
You when exactly was the $3,900 fee assessed?
11:37:46 AM
Randy Harmdierks your account isn't displaying the fee dates. I'm going to generate and send you your payment history. They will be on there. If you have further questions at that point, please contact us again.
11:37:56 AM
Randy Harmdierks I will e-mail it and send a paper copy to your address.
11:40:23 AM
You wow thanks for avoiding the inquiry
11:40:53 AM
You you guys are clearly a bunch of crooks
11:41:10 AM
Randy Harmdierks I'm sending your payment history.
11:41:13 AM
Randy Harmdierks Is there anything else I can help you with today?

babe please re-read my post. I consolidated with another lender. nelnet, the original lender charged me a loan servicing fee.

Sorry missed that.....do you have a copy of your original prom note with these terms???

From Nelnets current private loans....http://www.nelnet.com/private_loans.aspx?id=1000&path=bsp.fye.fal.col.priv

Benefits & FeaturesHigh approval rates
No application fees
Interest rates starting below the Prime rate
Education Counselors available to assist you with your questions toll-free at 866.866.7372
Easy online pre-approval process available 24 / 7
Pre-approval process only takes a few minutes
Flexible repayment options
No pre-payment penalty
No payments while in school

Havent found anything else yet on a Choice loan....

wow you wont believe what happened---I wrote a long letter to Nelnet's CEO Michael S. Dunlap--just got a call from the the executive office.......all fees waived in "good faith" of my repayment!!

lol i'm still very amazed at what just happened...

^ Nice!