Nelnet is the fourth-largest federal student loan servicer in the U.S., after FedLoan Servicing (also known as PHEAA), Great Lakes and Navient. The company is based in Lincoln, Nebraska.
Nelnet manages federal student loans for the U.S. Department of Education. So if Nelnet services your federal loans, it processes your payments, helps you enroll in repayment plans and answers questions about your loans. Nelnet runs four separate businesses; besides servicing student loans, the company also administers tuition payment plans for students attending private K-12 schools and helps colleges recruit prospective students.
Quick facts
- 6 million : Number of borrowers served
- $149 billion : Amount of loans in Nelnet’s portfolio
- (888) 486-4722 : Phone number, staffed 24/7, excluding U.S. holidays
How to make a payment
Online
The easiest way to make payments and keep track of your loans is to create an account on Nelnet’s online customer portal. Enter your Social Security number, date of birth and email to verify your identity, then create a username and password so you can log in and make monthly payments online. You can also set up text alerts, under “Settings” when you’re logged in, to remind you to make payments.
You’ll be even more likely to stay on top of your loans if you sign up for monthly automatic payments through Nelnet, called “auto debit.” Enroll in auto debit by logging into your account on Nelnet.com and selecting “Set Up Auto Debit.” Enter your bank account information, including your account number and routing number, and Nelnet will automatically deduct your scheduled payment from your bank account each month. You may also receive an interest rate reduction of 0.25% on each of your federal Direct Loans when you choose auto debit.
There are two other ways to make student loan payments to Nelnet.
By mail
The address you should mail payments to will appear on your monthly billing statement. If you’re still not sure where to send your check, the first letter of your Nelnet account number will tell you.
If your account number starts with E, mail a check made out to “Nelnet” to:
Department of Education
Nelnet
P.O. Box 740283
Atlanta, GA 30374-0283
If your account number starts with D, mail a check made out to “Nelnet” to:
Nelnet
P.O. Box 2970
Omaha, NE 68103-2970
If your account number starts with J, mail a check made out to “Nelnet” to:
Nelnet
P.O. Box 2877
Omaha, NE 68103-2877
Keep in mind that your payment will be applied within five business days once Nelnet receives it. So allow for both shipping time and that five-day window when you mail in payment. If you send a check just three days before your due date, for instance, and Nelnet doesn’t receive or process it in time, your payment might be considered late.
By phone
Call (888) 486-4722 and follow the automated prompts. Have your Social Security number and account number ready.
Tips from Nelnet
- Create text alerts to remind yourself to make payments, or to get an update if your account is past due.
- Ask to align your due dates so all your Nelnet loan payments are due at the same time. Otherwise, they could vary.
How Nelnet applies payments to loans
Nelnet bundles individual loans into groups based on characteristics they share, like the loan type or interest rate, and charges you a total monthly amount for that group. For each loan, federal regulations require Nelnet to apply loan payments to late fees first, then to outstanding interest and, finally, to the principal balance, or the original amount of the loan disbursed.
The one difference is for federal loans in repayment under an income-driven repayment plan. Those payments are applied to interest first, then to late fees and, finally, to the principal balance. It’s likely the majority of what you pay will go toward interest when you’re on an income-driven plan. Interest accrues quickly on these plans because you’re paying less per month over a longer period of time.
Also keep in mind that you’ll save money in the long run if you make a point to contribute more than your scheduled payment each month. The more you pay now, the larger the dent you’ll make in your principal balance.
What to do if you’re behind on your payments
The sooner you get in touch with Nelnet to resolve past-due payments, the better. As soon as you receive a notice or realize on your own that your payment was late, call the company at (888) 486-4722. Ask how much you’d have to pay to bring your account up to date, and how you can make the payment so it’s applied as soon as possible.
Late payments don’t negatively affect your credit until you’re 90 days behind, according to Nelnet. That’s when the company alerts the three credit bureaus (Equifax, Experian and TransUnion) that your loan is delinquent, which will stay on your credit report up to seven years.
If you’re having trouble affording your payments, log in to Nelnet’s website and click “Lower My Payments.” You can switch repayment plans so you’re paying less per month, which might require additional paperwork. You can also click “Postpone My Payments” to apply online for deferment or forbearance, which allow you to take a break from loan payments if you go back to school, are unemployed or have another financial hardship.
How you can pay down loans faster
Your options for paying more than your scheduled monthly payment include:
- Setting up auto debit for a higher amount than you owe each month (not available if you’re on an income-driven plan); or
- Making a separate payment at another point in the month, in addition to your monthly bill.
When you pay more than your scheduled amount due, Nelnet applies that amount across all the loans in that loan group. They’ll first apply the extra to interest accrued since your last payment, then to each of your principal balances according to the amount due for each one.
Your account will be considered “paid ahead,” meaning the extra amount will automatically go toward next month’s payment on those loans. If you’re enrolled in auto debit, Nelnet will continue to deduct the amount you’ve scheduled to pay each month, even though you’re paid ahead.
The way Nelnet automatically applies your extra payments might not help you pay down your loans fastest. Instead, you can give the company special instructions to apply extra payments to a specific loan — say, to the one with the highest interest rate. To do so, email directions to Nelnet, and specify whether it’s a one-time request or should happen on a recurring basis. The Consumer Financial Protection Bureau put together a sample letter you can use.
You can also target payments when you pay online. After choosing “Pay Now” when you’re logged in, click “Pay by Group” and enter the additional amount you want to pay on each loan group. Learn more in the “Special Instruction Payments” section of Nelnet’s Frequently Asked Questions page.
Whom to contact if you have questions
There are lots of ways to contact Nelnet.
Call
The number is (888) 486-4722. It’s staffed 24/7, except during U.S. holidays. Have your Social Security number and account information handy so you can refer to it when you speak with customer service.
Fill out an email form online.
If you have an urgent question about your loan payments, calling is your best bet. Don’t hesitate to contact Nelnet, especially if you’re having trouble making your payments or you’re interested in switching repayment plans. It’s your servicer’s job to help you.
Brianna McGurran is a staff writer at NerdWallet, a personal finance website. Email: bmcgurran@nerdwallet.com. Twitter: @briannamcscribe.
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