Nelnet to reduce headcount in student loan servicing division

Nelnet announced changes to manage excess staff capacity due to delays in the government’s student debt relief and return to repayment programs. Approximately 350 associates who were hired within the last six months will be laid off and approximately 210 associates will be terminated for performance reasons in the company’s Nelnet Diversified Services division. Last year, NDS took steps to grow its loan servicing teams in anticipation of the implementation of the Student Debt Relief Program as well as return to repayment for federal student loans, which was set to occur on December 31, 2022. However, with the U.S. Department of Education’s announcement in November that the pause on repayment has been extended to late 2023 and with the Student Debt Relief Program currently in litigation, NDS must now right-size its loan servicing teams to better align with current volume. The approximately 350 associates who will be laid off were hired within the last six months for the primary purpose of meeting the anticipated increase in student loan borrower activity, which was further delayed. A 60-day working notification was given to these associates whose performance was not a factor. Performance was used to identify approximately 210 of the impacted associates. No additional changes related to staff capacity are planned.