The student loan lending landscape is full of government and private funding options with all sorts of terms, conditions, fees, and varying interest rates.
The sheer number of choices can make shopping around for the best rates very time-consuming (which is why a comparison-shopping service like Credible can be so helpful).
Adding to the growing list of student loan lenders, there's a new entrant — Nelnet Bank. You're probably more familiar with Nelnet as a federal student loan servicer. But the company also provides student loan refinancing and will soon be offering banking products as well.
To help you figure out if Nelnet Bank is worth considering, we've scoured it's website for the most important refinancing information. Continue reading our full Nelnet Bank review to learn more about what it has to offer.
Quick Summary
- New bank formed by NelNet to offer banking and student loan refinancing
- Will soon offer high-yield CDs as well
- Up to 24 months of forbearance available
Nelnet Bank Details | |
|---|---|
Product Name | Nelnet Bank |
Min Loan Amount | $5,000 |
Max Loan Amount | $125,000 - $500,000 |
Fixed Rate APR | 2.80% - 6.10% |
Variable Rate APR | 1.89% - 5.99% |
Loan Terms | 5 - 25 years |
Promotions | None |
Who Is Nelnet Bank?
Nelnet Bank is an online-only bank that offers student loan refinancing. Its CEO is Andrea Moss. Nelnet Bank was formed in November 2020. It operates as an internet bank franchise and is a subsidiary of Nelnet, Inc. It is based in Salt Lake City, UT. Nelnet Bank was funded with $100 million from Nelnet.
In a press release, Moss said, "At Nelnet Bank, our mission is to help families achieve their dreams with financial knowledge and access to education. Nelnet Bank will allow us to meet the changing and diverse needs of the higher education market."
What Do They Offer?
Currently, Nelnet Bank only offers student loan refinancing. It will soon offer private student loans and high-yield CDs as well. Nelnet Bank's benefits include that it has no origination fees, provides a 0.25% discount for autopay, and has a generous 24-month forbearance.
Refinancing rates start at 2.80% APR for fixed-rate loans and 1.89% for loans with variable rates. You can check your rate without impacting your credit score since Nelnet Bank uses a “soft” credit pull.
The best rates go to those with good credit who are utilizing the autopay discount, have a five-year term, and are making immediate principal and interest payments. After being approved, loans are typically paid off in 10-14 days.
Loan terms are available for 5 to 25 years. In general, the shorter the loan term, the lower your interest rate will be. However, your monthly payment will also be higher.
Eligibility Requirements
To qualify for refinancing with Nelnet Bank, you’ll need to meet the following criteria:
If you don’t meet the credit score or income thresholds, your cosigner must meet them. Cosigners are not required but can help you get the best rate. And non-residents can become eligible for refinancing by applying with a cosigner who is a creditworthy U.S. citizen or permanent resident.
Nelnet does have a cosigner release option after 24 consecutive, on-time payments of principal and interest have been made within 15 days of their due date. To release a cosigner, the borrower must meet the latest credit underwriting eligibility requirements.
Refinance Limits
There are limits on the amount that can be refinanced with Nelnet Bank. The minimum loan amount for all borrowers is $5,000. The maximum you can borrow will depend on the type of degree you hold, as the table below shows.
Undergraduate | $125,000 |
Graduate, Doctorate, MBA, or Law | $175,000 |
Graduate Health Professions | $500,000 |
Customer Service
Nelnet Bank customer service is available from 7 a.m. – 8 p.m. (CT) Monday through Friday. They can be reached at 800-446-4190 or Loans@NelnetBank.com.
Are There Any Fees?
While there are no origination or application fees, there is a 5% late fee if you're 15 days late. The fee is applied to the payment amount. This fee cannot be more than $25. You're not charged any fees for paying your loan off early or making extra payments.
Header | |  |  |
|---|---|---|---|
Rating | |||
Variable APR | 1.89% - 5.99% | 1.89% - 5.99% | 2.39% - 6.01% |
Fixed APR | 2.80% - 6.10% | 2.63% - 6.88% | 2.79% - 5.99% |
Bonus Offer | None | Up to $500 | Up to $775 |
Cell |
How Do I Apply?
You can visit the Nelnet Bank website to apply. There are three steps in the application process:
- 1Complete application
- 2Review loan offers
- 3Accept loan offer
After getting approved, you’ll need the most recent student loan or payoff verification statement. Proof of income is also required, which can be your two most recent pay stubs.
Is It Worth It?
Nelnet Bank has the resources and experience of Nelnet, Inc (which has been part of the student loan industry for 30 years) at its disposal. In theory, that could result in knowledgeable service and solid benefits.
But, at the end of the day, it all comes down to fees and interest rates. There are no fees with Nelnet Bank, but you’ll have to shop around to see if they offer the best rate.
We can help you with that. Check out our post on the best places to refinance student loans. It’s great for helping you compare rates and terms from multiple lenders.
Nelnet Features
Min Loan Amount | $5,000 |
Max Loan Amount | Undergraduate: $125,000
Graduate health professions degree: $500,000 |
Fixed Rate APR | 2.80% - 6.10% |
Variable Rate APR | 1.89% - 5.99% |
Soft Credit Check | Yes |
Auto-Pay Discount | 0.25% |
Loan Terms | 5 - 25 years |
Origination Fees | None |
Prepayment Penalties | None |
Forbearance Length | Up to 24 months |
Late Payment Fee | 5% of payment amount (max of $25) |
Cosigners | Allowed |
Cosigner Release | Can be requested after 24 consecutive, on-time payments |
Customer Service Phone Number | 1-800-446-4190 |
Customer Service Hours | Mon-Fri, 7 AM - 8 PM (CT) |
Mailing Address | Nelnet Bank 13907 S. Minuteman Dr., Ste. 250 Draper, UT 84020 |
Promotions | None |
Nelnet Bank Review
- Rates and Fees
- Application Requirements
- Customer Service
- Products and Services
Overall
Summary
Nelnet Bank, a subsidiary of Nelnet (the federal loan servicer), provides student loan refinancing and will soon offer high-yield CDs.
Pros
- No origination or application fees
- Uses a soft credit pull for initial rate check
- Low rates for qualified borrowers
- Generous forbearance length of 24 months
Cons
- No refinance bonus offers
- Won’t lend to borrowers with credit scores below 680
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.