Nelnet Student Loans – 9 Student Loan Hacks
Updated On November 2, 2021
Editorial Note: This content is based solely on the author's opinions and is not provided, approved, endorsed or reviewed by any financial institution or partner.
If you have Nelnet student loans, then pay attention.
Here are 9 student loan hacks from borrowers with Nelnet student loans – as well as answers – that can help guide your path forward:
1. Nelnet Student Loans Hack #1 – I have a private student loan and I work as an educator. Can I qualify for teacher loan forgiveness?
If you have Nelnet student loans, unfortunately, private student loans are not eligible for Teacher Loan Forgiveness. However, teachers with federal direct or Stafford Loans are eligible to have up to $5,000 forgiven and up to $17,500 forgiven for elementary and secondary special education teachers and secondary math and science teachers.
Teacher Student Loan Forgiveness is for full-time teachers with five years of teaching experience in a designated elementary or secondary school or educational service agency that serves students from low income families.
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2. Nelnet Student Loans Hack #2 – If I have a student loan from Sallie Mae, is it considered a government loan?
If you have Nelnet student loans, then you likely do not have a student loan from Sallie Mae.
The short answer is “no.”
In 1972, Sallie Mae, or the Student Loan Marketing Association, was established as a government-sponsored enterprise, or GSE. Sallie Mae was then privatized in 2004 when Congress terminated Sallie Mae’s federal charter.
Today, Sallie Mae is a publicly traded company (not part of the federal government) that offers private student loans. These student loans are not federal loans, since federal loans can only be issued by the federal government.
Prior to October 2014, Sallie Mae was a loan servicer for two federal student loan programs: the Direct Loan Program and the Federal Family Education Loan Program (FFELP). That same year, Sallie Mae split in two: the consumer banking business became known as Sallie Mae, and the student loan servicing operations became Navient.
3. Nelnet Student Loans Hack #3 – If I have Nelnet student loans and am unemployed, can I enter an income-driven repayment plan?
If you have Nelnet student loans and are unemployed, you can enroll in an income-driven repayment plan such as Income-Based Repayment (IBR), Pay As You Earn (PAYE) and Revised Pay As You Earn (REPAYE). Under these plans, if you have Nelnet student loans but have no income, your monthly student loan payment would be $0.
While your monthly Nelnet student loans payment would be $0, interest on your Nelnet student loans would still accrue. Therefore, during the period in which you are enrolled in an income-driven repayment plan, you should expect your Nelnet student loans balance to increase since you are not reducing your principal.
4. Nelnet Student Loans Hack #4 – I wrote clear instructions on the check for my Nelnet student loans payment. However, Nelnet did not follow my instructions. What recourse do I have?
If you have important instructions for your Nelnet student loans, you should always communicate in writing.
However, you should send Nelnet a formal written correspondence. This includes formal requests, payment instructions and any other material issues related to your Nelnet student loans. Your student loan servicer may not manually review each paper check, and therefore your instructions may be overlooked.
Sending paper checks should be avoided in favor of automatic payment enrollment.
In many cases, you may be eligible for a 0.25% interest rate deduction when you enroll in automatic payments. Enrolling in automatic payment (preferably directly with your student loan servicer, rather than your bank) also will help ensure that your student loan payment reaches your student loan servicer on time each month.
5. Nelnet Student Loans Hack #5 – What happens if the Navient lawsuit is “successful?” Do I get compensated?
If you have Nelnet student loans, you may be wondering how the Navient lawsuit may impact you.
The lawsuit against Navient was filed by the Consumer Financial Protection Bureau (CFPB), which is a federal government agency. Therefore, this lawsuit is not a class action lawsuit. At this juncture, there is no indication that Nelnet is facing a similar lawsuit from the CFPB.
If your student loans are serviced by Nelnet, you probably should not expect any compensation at this juncture.
6. Nelnet Student Loan Hacks #6 – Can I change my student loan servicer?
If you have Nelnet student loans, generally, you cannot change your student loan servicer.
However, you should expect that your student loan servicer will change at least once during the course of your student loan repayment. Why? The U.S. Department of Education may transfer your federal loan to a new student loan servicer to ensure that you have proper customer service and repayment support.
One way that you can change your student loan servicer is through student loan consolidation.
If you consolidate with a Federal Direct Consolidation Loan, your existing student loans are combined into a single student loan with a single student loan payment. However, your student loan interest rate does not decrease.
When you consolidate your student loans, you can choose one of four student loan servicers: Navient, Nelnet, Great Lakes Educational Loan Services or FedLoan Servicing. There is no guarantee that after your select a student loan servicer that your student loan is transferred to another student loan servicer.
7. Nelnet Student Loans Hack #7 – I read that one way to pay off your student loans faster is to make an extra student loan payment. Will I be charged a fee for paying off my Nelnet student loans early?
No. All federal and private student loans do not include a prepayment penalty.
Therefore, there are no fees to pay off your Nelnet student loans faster, including making additional student loan payments.
Absent any instructions from you, a lender will apply your student loan payment in the following order: late fees, collection costs, interest and principal.
If you make an extra payment, lenders are permitted by federal regulations to apply a prepayment to future payments (absent any instructions to the contrary). If you would like an extra payment to be applied first toward principal, send written correspondence with clear instructions to your lender. Similarly, you can instruct your lender to apply an extra student loan repayment toward your student loan with the highest interest rate.
8. Nelnet Student Loans Hack #8 – I have a variable interest rate student loan and am concerned that my monthly payments will increase now that interest rates are rising. Am I stuck?
You are correct that as interest rates rise, your variable interest rate on your Nelnet student loans will also rise.
However, not all is lost. You can choose to refinance your Nelnet student loans from a variable to a fixed interest rate student loan. With a fixed interest rate student loan, your interest rate will stay the same so long as your student loan is outstanding – regardless of interest rate movements (up or down).
9. Nelnet Student Loans Hack #9 – My student loan servicer told me that if I have private student loans, no lender will refinance them.
Not true. You can refinance all your student loans – both government and private.
Mentor can help you learn more about these various options:
- Student Loan Refinancing
- Federal Student Loan Consolidation
- Income-Driven Repayment Plans
- Student Loan Forgiveness