Nelnet Student Loans Refinancing and Consolidating

Learn all you need to know about refinancing and consolidating Nelnet Student Loans, difference between the two and top lenders providing these services.

Updated by Heibha Passah on 22nd September 2020

Nelnet student loans (National Education Loan Network) is a student loan servicer located in Lincoln, Nebraska, which works with the Department of Education (DOE) to provide customer service to those having federal student loans, to clear their doubts and help them find solutions if they have trouble repaying their loans or in processing payments. Nelnet offers student loan refinancing and consolidation services. 

It also provides private loans and offers to service for the same and loans from other lenders. For Federal loans, the DOE usually decides which loan servicer you will get, so there’s a chance that you might get Nelnet as a servicer. Hence, it is important to know about the various offers provided by them.

Table of contents

Nelnet Repayment Plans

Nelnet, like any other loan servicer, provides several repayment plans which you can choose from, that suit your needs and help you repay your loans without any hassle. The following plans are offered to the borrowers - 

  1. Standard Repayment Plan

  2. Graduated Repayment Plan

  3. Extended Repayment Plan

  4. Income-Sensitive Repayment Plan

  5. Income-Driven Repayment Plan

How to make payments

Nelnet provides the following options to make payments - 

1. Auto-Debit - When you sign up for Auto-debit, your payments will be deducted automatically from your account every month. You may also be eligible for a 25% reduction in interest rates. This makes it easier for you as you don’t have to do it manually and will never miss a due date, which will save you time and money.

2. Mobile App - An app is available for phone iPhone and Android users. Download the app to manage your payments conveniently.

3. Online Payment - You can make an online account on our website to make a payment. You can also get to know about various information like the due dates, auto-debit, find the various repayment options and set up your authorized payers.

4. Mail - You can pay the amount via sending it to the address. Also, make sure to include your account number.

5. Online Bill Pay Service - You can use your own bank’s online bill pay service. Provide details of the payee (Nelnet), your account number, and the payment address.

6. Phone - You can make payments by directly by calling on 888.486.4722, which is Nelnet’s automated phone system or customer service.

Deferment and Forbearance options

If you are having trouble with repaying your loans, you can apply for student loan deferment or forbearance which allows you to postpone your payments.

Available Deferments

1. Armed Forces Deferment - If you are a member of the Armed Forces or National Guard and are on active duty, then you can apply for this deferment. You also need to have your first Stafford or SLS loan disbursed before July 1, 1993, or in case of Parent PLUS Loans, disbursement should be before August 15, 1983. Consolidation loans do not qualify for this deferment.

2. Domestic Volunteer Deferment - If you are a paid volunteer working full time in ACTION (Domestic Volunteer Service Act of 1973, VISTA or AmeriCorps) program for more than one year, then you can apply for this deferment.

You need also need to have your first Stafford Loan disbursed before July 1, 1993, or in case of Parent PLUS Loans, disbursement should be before August 15, 1983. Consolidation loans are not qualified for this deferment.

 3. Full-time teacher in a Teacher Shortage Area Deferment -  If you are teaching in an area that has a shortage of teachers then you can qualify for deferment. Your first Stafford loan should also be disbursed on or after July 1, 1987, but before July 1, 1993. PLUS and Consolidation loans are not eligible for this.

4. Graduate Fellowship Deferment - If you’ve received your undergraduate degree and then got accepted for a full-time Graduate Fellowship Program, then you can defer your payments with no cumulative maximum time limit.

5. National Oceanic and Atmospheric Administration (NOAA) Deferment - If you are part of the NOAA and is on active duty, then you can defer your loans up to 36 months. Also, you need to get your first Stafford loans disbursed on or after July 1, 1987, but before July 1, 1993. PLUS and Consolidation loans are not eligible for this.

In addition to the above, there are other eligible Deferments like economic hardship deferment, military service deferment, parental leave deferment,  post-active duty student deferment, and more. 

Have doubts regarding your loans? Check student loans lenders, repayment, and debt statistics to get your answers 

Available Forbearances

1. Active Military Duty - Borrowers who are members of the National Guard (including retirees), not qualifying for military deferment can apply for forbearance up to 12 months at a time. The period of service should start on or after October 1, 2007.

2. Corporation for National and Community Service (CNCS) Loan Repayment Program - Workers in community service who are accepted for partial payment under the CNCS loan repayment program are granted forbearance for a period of up to 12 months at a time.

3. Hardship - If you are having trouble making payments and do not qualify for deferment or other forbearances, then hardship forbearance is granted up to 12 months at a time.

4. Student Loan Debt Burden - If your monthly payments are equal or 20% more than your monthly total income, then you qualify for this forbearance up to 12 months at a time with a cumulative maximum time limit of 36 months.

5. Teacher Loan Forgiveness Program - If you are teaching in a qualifying teaching service for an eligible school, then your loans will qualify for Teacher Loan Forgiveness Program, which makes you eligible for forbearance up to 12 months at a time.

Other forbearance deferments include reduced payment, internship/residency, and DOD Loan Repayment Program. Apart from the forbearance program, Nelnet provides various student loan forgiveness programs

Benefits to servicemen

As an appreciation to those serving the country, Nelnet has come up with various programs that will benefit the military servicemen and veterans.

Nelnet Student Loanssource -

1. Servicemembers Civil Relief Act (SCRA) - Under this, the interest rates on Federal student loans taken before military service will not exceed 6%.

2. Interest at 0% while serving in hostile areas-

Eligibility criteria-

  • Restricted to Federal Direct Loans disbursed on or after October 2008 only

  • Federal Direct Consolidation Loans, the loans that are consolidated cannot be disbursed before October 1, 2008

  • Active duty is being carried out in a hostile area and the services are qualified for special pay under 37 USC, then you are eligible for 0% interest up to 60 months

3. HEROES Act Waiver for Income-driven Repayment Plan Recertification for Servicemembers - This act allows you or any authorized third party like your school, spouse, or any other family member to ask for extending the reduced amount payment on your income-driven repayment plan. Servicemembers must adhere to the following conditions to be eligible-

  • Carrying out active duty during a war, other military functions, or national emergency

  • Carrying out eligible national guard duty during a war, other military functions, or national emergency

4. Military Deferment

5. Armed Forces/Public Health Service Deferment

6. National Oceanic and Atmospheric Administration (NOAA) Deferment

7. Public Service Loan Forgiveness

8. Forbearance is mandatorily available for the National Guard or Department of Defense Repayment Program.

Additional loan assistance programs

1. Public Service Loan Forgiveness - If you are a public service worker and is full-time employed by certain public service employers and have made 120 qualifying payments during this time, then the outstanding Federal loan balance will be eligible for forgiveness.

2. Disability Discharge - If you have Federal Family Education Loans (FFEL), Perkins Loans, Direct Loans, or Teacher Education Assistance for College and Higher Education (TEACH) Grant service obligation and is not able to work because of total and permanent disability then you qualify for a Total and Permanent Disability (TPD) discharge for these loans.

3. Stafford Loan Forgiveness Program for Teachers - If you are a full-time teacher for 5 successive years, complete academic years, then this program allows up to $17500 forgiveness on your student loans.

4. Death - If a borrower of a PLUS loan passed away, then the loan is discharged and the remaining payments are forgiven. A certified death certificate should be provided as proof.

5. Bankruptcy - If you decide to file for bankruptcy, you should keep in mind the following regarding your loans-

  • Your student loan debt might not be forgiven

  • Your creditor and student loan servicer are alerted and an automatic stay starts

  • Under an automatic stay, your creditors won’t be able to put collection efforts for your debts

  • After the bankruptcy case is over and your loans are not forgiven, then your creditor will continue collection efforts

  • While the bankruptcy status is still pending, interest will continue to accrue which will increase the amount you owe. Consult with an attorney to talk about the options you have

Nelnet consolidation options

You might have multiple loans to repay after your studies. It means making several payments every month. It can hamper your financial position especially if you are a recent graduate, as you might still be unemployed or newly employed.

In such a case, consolidating your loans will be a good option.

For those who are borrowing Federal loans can get their loans consolidated under the Direct Consolidation Program provided by the U.S Department of Education or through a private lender. It allows you to combine all your loans into a single loan. You can also have the option, after consolidating, to choose a different servicer, or stay with Nelnet, as per your requirement. 

Let us look into the pros and cons of loan consolidation.

Pros Cons
Your loan is combined with only one loan, one servicer, and one payment. It extends your repayment period making you pay more interest over time.
Monthly payments are lesser. Losing out on certain Federal student loan benefits.
Gain access to repayment plans that were not accessible before. No military benefits for borrowers going on active duty after loan consolidation
You can change from variable to fixed interest rates, on certain events. The interest is charged on a weighted average of loans (rounded up to the nearest 1/8th percentage) which might be slightly higher than other loans.
Consolidation fees are not charged Payments already made to Public Service Loan Forgiveness or Income-Driven Repayment Plan forgiveness will be lost.

Nelnet does not provide consolidation services, so you have to get your federal or private student loans consolidated either with the Federal Government or a private lender.

Consolidation of Federal student loans

Federal loans that are eligible for consolidation-

  • Direct Subsidized and Unsubsidized Loans

  • Direct PLUS Loans

Your Federal loans can be consolidated either with the Federal Government or with a private lender.

Consolidating with the Federal Government - Consolidation of certain Federal loans with the Federal Government can make loans eligible for programs like Public Service Student Loan Forgiveness, which weren’t earlier. But you might lose out credit from the qualifying payments that you have made.

It means that you have to make repayments from the start on your new loan. If you’re just starting with repayments then you can opt for this or else you would just end up paying more money, which doesn’t make sense. Also, interest will be charged on the weighted average of the loan which might make the rates a bit higher to other loans.

Consolidating with a private lender - Using this approach will allow you to get lower interest rates on your Federal student loans but it also comes with a price. You will no longer be able to avail of all the benefits that come with a federal loan such as the Income-based Repayment Plan and Public Service Loan Forgiveness Program.

So if you think that you won’t be needing these benefits then go ahead and consolidate your loans as it’ll give you the benefit of reducing your loan amount with reduced interest rates.

Read more on Federal student loan consolidation 

Adding loans to your Direct Consolidation Loans

After consolidating your loans to a Direct Consolidation Loan, you can still add more eligible loans to it. You must request to Add Loans Form within 180 days from the date you form your original Direct Consolidation Loan. If it is done after 180 days then you have to request a new Direct Loan Consolidation for adding other loans.

In Nelnet, after the request to Add Loans Form, you can send it to their email- or directly mail it to-


P.O. Box 82658

Lincoln, NE 68501-2658

Consolidation of Private student loans

Private student loans can only be consolidated with a private lender. It is a good option as you will be able to get the interest rates at a lower amount after consolidation, especially if you have enough inflows and a good credit score. For those who do not have a degree or are still unemployed, the interest rate might be higher but it depends upon the lenders. 

Nelnet usually recommends Ufi as a private lender to get your consolidation loans, but it totally up to you. You can compare various lenders and choose the best one.

Nelnet Consolidation Terms and Conditions

Eligibility criteria 

  • The borrower must be a graduate, left school or are away temporarily, or dropped before enrolling half time

  • The borrower should have at least one federal student loan which is in the grace period or repayment period

  • Students who want to consolidate their defaulted student loans have to be enrolled in an income-based repayment plan

  • Federal Direct PLUS loans are not eligible for consolidation

  • If you have Federal loans and you and your spouse consolidate it, then you won't be eligible for the Direct Consolidation Program.

The eligible borrowers have to adhere to the following terms and conditions - 

  • Their credit will not be checked

  • They don’t need to pay application fees

  • They won’t be charged a penalty for making early payments

  • There is no minimum loan amount

  • The interest rate is fixed at a loan rate which is calculated as the weighted average of the interest rates of the consolidated loans. It will not exceed 8.25%

  • The repayment plan is flexible.

Refinancing your loans

Nelnet offers the option of refinancing your loans through Ufi, but it depends on you to find out which lender will serve you best.

Refinancing is when a borrower acquires a new loan with new terms to pay off your previous loans. This option is best if you have a mix of both Federal and Private loans. It will combine both of these loans and the interest rate will be determined based on your credit score. So, if you have a good credit score, the interest rates will be lower.

Going for a new loan with lower interest rates to pay off your old loans is a good option as it will get you out of debt faster. It also provides an option to either extend or reduce your repayment period on the new loan.

Just like consolidation, refinancing also deprives you of the benefits that you get on Federal loans, so if you feel like you can do without these benefits then you can refinance your loans as it will help you save a lot from the reduced rates.  Apart from Nelnet, there are also a lot of lenders that refinance your student loans. Check out the best companies that refinance your student loans.

Nelnet Refinancing Eligibility and Requirements

The criteria depend upon the lenders as it will be based on their credit scores and they should have a rigid employment history. If you’re not eligible, try to get a consigner which also gives an added benefit of getting a better interest rate.

Both private and federal students qualify for refinancing but only through a private lender, so you can combine both. 

Read more on student loan refinancing

When to refinance and consolidate

For consolidating or refinancing always remember to own a graduation degree. And if your loans are the following- Direct Subsidized and Unsubsidized Loans, FFELP, FFELP PLUS, Direct PLUS, Perkins, HEAL, SLS loans, these loans can be consolidated to one. For consolidating you can fill their online form to submit for the process and any queries related to these loans you can drop a mail to them.

Choosing consolidation:

  1. If you have many federal loans and find it hard to manage the repayments, you can consolidate all these loans into a single loan.

  2. If your loans are from the Federal Family Education Loan program and you don't qualify for forgiveness programs and income-driven repayment, you can choose to opt direct consolidation are avail of these benefits.

  3. Consolidation also helps you to choose a new service provider.

Choosing Refinancing:

  1. If you have private student loans and looking for lower interest rates not considering loan forgiveness and income-driven repayment policies, then choose to opt to refinance.

  2. Private lenders decide your monthly payments considering your financing situation, this could help decrease monthly payments.

  3. In federal loan, you cannot consolidate undergraduate loans with PLUS loans hence cosigner release not possible, where you can refinance and pay all the loans in your name while refinancing.

Consolidation Vs. Refinancing

Let us compare and see the differences between refinancing and consolidation to find out which option works best for you.

Consolidation Refinancing
Combining all your loans into a single loan with new terms. Acquiring a new loan to pay off your old loan.
If you do not want to lose out on your Federal loan benefits, then you can opt for consolidation with the federal government.
Refinancing will remove the benefits you get on Federal loans as it can only be done with a private lender.
If borrowers fulfill the eligibility criteria, then their credit score won’t matter. The credit score determines the interest rate charged on the borrower.
It extends the repayment period because of the new terms in the loan.
It gives the option of extending or reducing the repayment period and can extend beyond the consolidation.

As we can see that both refinancing and consolidation have their benefits, depending on your need and preference you can choose to either consolidate or refinance your Nelnet student loans.

If you have Federal Loans and do not want to lose out on the benefits, you can opt for consolidation with the federal government. If you don’t mind losing out on these benefits, you can go for consolidation with a private lender or refinancing as these will get you lower interest rates.

For consolidation, your credit score doesn’t matter as long as you qualify for it. Some lenders even help in paying off your debt if you lose your job in between. But refinancing is based on your credit score and your employment history. So, if you do not have a good credit score and stable employment, you won’t be able to refinance your loans. 

Choosing your lender

Private lenders can be chosen by the borrower to refinance and consolidate their loans. The decision is usually based on the interest rates offered, how flexible are the payment plans, the quality of the services, and customer support along with other added benefits.

The new loan offered by the lender will have new terms like a new interest rate, repayment term, and the payments of the previous loans will be paid off by them. The monthly payments will also be made to them instead of Nelnet, or to the federal government if the federal loans are consolidated with them.

Frequently Asked Questions

  • 1.Can my loans be discharged or forgiven with Nelnet?

    You can be eligible for discharge or have your loans forgiven if you’ve experienced a disability, death, or bankruptcy (in rare cases). Some lenders offer loan forgiveness to teachers and public service employees. Nelnet only acts as a servicer of federal loans and can give you more information on loan forgiveness.

  • 2.Why do I receive more than one monthly statement?

    Nelnet will send billing statements every month about 3 weeks before a payment is due. If you receive more than one monthly statement, it is because you have more than one student loan account with Nelnet. 

  • 3.Does Nelnet provide student loan forgiveness?

    Nelnet offers student loan forgiveness under the Public Service Loan Forgiveness Program if you are employed by a government or non-profit organization. If you have direct loans with IDR repayment plans and have made 120 qualifying monthly payments to avail forgiveness under the Public Service Loan Forgiveness Program.

  • 4.Can consolidation of student loans be possible with Nelnet?

    Yes, you can consolidate your student loans with Nelnet. Federal student loan borrowers can consolidate their loans by merging multiple loans into a single loan.

  • 5.What happens if you don't pay Nelnet?  

    If you do not pay Nelnet, it seizes your tax refund and garnishes your paycheck. That is it calls your employer to arrange a portion of your salary to be sent directly to the government. Your loans can go to default and applying and getting student loans in the future can be challenging. 

  • 6.Does Nelnet charge any fee on changing the Repayment Plan?  

    No. Nelnet does not charge any fee on changing Repayment Plans. Log in to the official website of Nelnet to know your repayment options. If you want to change your repayment plan, you should make one scheduled payment on the Standard Repayment Plan as per the federal guidelines.

  • 7.How are interest rates determined on student loans?

    It depends on the type of loan the U.S Congress determines the interest rate of Federal Direct Loans every year. Servicers like Nelnet set their interest rates by using a financial index.