If you’re like most Americans, you’re up to your ears in student loan debt. In fact, the average debt of a 2016 college graduate is over $37,000. That’s insanely high, considering the majority of those grads go into sales. The average entry level sales salary is $42,000 per year.
So how are you supposed to pay off your debt? That’s like working for free for over a year. Well, that’s where Nelnet reviews come in. I was chosen to write this review because both my brother in law and I have used the service. I’ll recount for you our experience with the service, as well as other Nelnet reviews from around the web.
What is Nelnet?
Nelnet is a “servicer” of student loans. If you’re working with Nelnet, there’s only a very small chance that your student loan came from the company. Instead, there are a few ways in which you might be affiliated with Nelnet.
First of all, sometimes if you default on your student loans, the originator will sell the debt to Nelnet. You’ll then be making payments to Nelnet – you’ll be paying down your student loan debt, but that sale adversely affects your credit score. That said, you don’t want it to get to this point.
It’s possible that you consolidated your student loans with Nelnet, as is the case with my brother in law and myself. We both attended public colleges in North Carolina, but chose to live off campus. The expenses were huge, and I, for one, had loans through about four different companies. It was too much to keep up with, and the interest rates were killing me.
Finally, there’s a small chance that you did get a loan with Nelnet. The company offers student loan programs, but those are rare. Chances are you’ve already worked with another company.
So what do Nelnet reviews say about the service? What are the pros and cons of using a company like Nelnet? Let’s take a look.
Nelnet Reviews: The Good
First of all, I’ve already mentioned that the interest on my student loans was getting out of hand. When I filed my 2014 Federal taxes, I realized that I’d paid almost $9,000 in student loan… interest. None of that was principal. That’s when I decided I needed to consolidate, and I was introduced to Nelnet.
There are requirements to registering to consolidate with Nelnet, as with most companies. But what happens, in a nutshell, is that a company agrees to pay off your student loans. You then owe that company for the total balance. I did this, and it cut my interest payments by about two thirds.
Payment was centralized and convenient. But, unfortunately, that’s about where the “good” stops. The pros section of Nelnet reviews is necessarily short; read on to find out why.
Nelnet Reviews: The Bad
Nelnet has been around for a long time. Prior to the government restructuring the way that student loans were distributed, the company actually originated many student loans. It was constantly under fire for providing kickbacks to universities. These universities would “encourage” students to pursue a Nelnet loan.
Another commonly cited problem, and one that I experienced myself, is that Nelnet is notoriously horrible at reporting to credit bureaus. A lot of people, like my brother in law and like me, decide to consolidate to protect their credit score. Nelnet would fail to report payments, and mysterious “late” payments would appear on credit reports. Many Nelnet reviews have said the same was true for them.
Contacting Nelnet about any issues is like pulling teeth. Sometimes calling the phone number will result in a high-pitched tone of disconnect. Other times, callers in Nelnet reviews were directed to the loan originator. Upon calling the loan office, graduates were informed that the originator had basically washed their hands of the loan.
Still other Nelnet reviews say that graduates were reported as delinquent, even despite their loans having been completely paid off! Obviously, that’s not possible, and it seems like Nelnet needs a new accounting staff.
You don’t need to look far to find negative Nelnet reviews. In fact, most are. Yes, my personal interest rate was lower, but my Nelnet account ended up adversely affecting my credit regardless. Other Nelnet reviews have had similar complaints, and the company does not come highly recommended.
Student Loan Consolidation
Student debt consolidation can save graduates thousands of dollars each year. And while student loan interest is tax deductible (up to a point), the savings is worth it.
However, Nelnet reviews should be enough to convince you that there are definitely better options for recent grads. After you graduate college, most loans have a grace period. This, in effect, gives you time to find a job. But after that grace period you can still opt for a deferment, of forebearance. This allows you to either stop making payments for a while, or to drastically reduce the amount of your monthly loan payments. At one point, my personal loan payments were down to $5 each month. This was done through the original creditor.
Nelnet isn’t a reputable company for many reasons, and a quick search of other Nelnet reviews returns results harmonious with that. If you’re looking to consolidate student loans, it’s recommended that you look to a more reputable company than Nelnet.
Nelnet Reviews: Is it a Scam?
Nelnet isn’t necessarily a scam, but there are certainly better options.
If your student loan originated with Nelnet, there are ways in which you can transfer ownership to another company. If your debt was purchased by the company, there may be little you can do. Just keep a close eye on your credit report.
For the best success in consolidating your loans, go through a company with a better track record. You could contact your local credit union or bank. If you have military experience, you can try a company like USAA or Navy Federal. The federal government also offers programs to consolidate debt.
No matter how you choose to reduce your student loan interest, we recommend that you steer clear of Nelnet.