Is Nelnet a Scam?

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Unravel the truth behind Nelnet's online services. Is it a trusted platform or another scam? Join our thorough investigation. Scam or genuine?

is nelnet a scam
Scam Grade:
B Grade: This business has a good reputation indicated by predominantly positive information across scam report sources. There are minimal concerns that would question their trustworthiness.

What’s The Background of Nelnet?

Nelnet is a well-known company that specializes in providing student loans. The company has a strong track record within the industry and has partnered with credit unions and other reputable organizations to offer student services.

Their customer service is something they are often praised for, as they have a responsive and helpful support team available to address any questions or concerns that borrowers may have. They work hand-in-hand with other loan servicing companies, such as Great Lakes, to provide the best possible experience for their users. Additionally, users must use their FSA ID, a unique identifier provided by the U.S. Department of Education, to access their loans on Nelnet’s platform, ensuring a secure experience for borrowers.

We’ve also noted several discussions about Nelnet on Reddit and other internet forums. Although some people have shared positive and negative experiences, most borrowers have had a decent experience with the company.

Some key factors we considered in our evaluation of Nelnet include:

  1. Partnership with the U.S. government
  2. Strong customer service
  3. Collaboration with other reputable organizations, such as Great Lakes
  4. Secure access to borrowers’ loan information using their FSA ID
  5. General sentiment about the company on platforms like Reddit

Based on these factors and our experience conducting research in this field, we believe that Nelnet is not a scam. They have a proven history of providing legitimate loan services to millions of needy students. Their commitment to collaboration with trusted organizations and providing secure access to their platform demonstrates their dedication to maintaining a professional and safe business operation.

Why Do People Think Nelnet is a Scam?

We have extensively researched why some people might think Nelnet is a scam. There are a few factors and incidents that contribute to this perception.

First, many borrowers have reported receiving emails from Nelnet that seem suspicious. For example, some emails contain links to secure messages that require users to input their account number or the last four digits of their Social Security Number. In some cases, users have confirmed with Nelnet that these emails were legitimate, but the overall impression leaves customers uneasy and unsure if they are being scammed1.

Another concern is how Nelnet handles loan consolidation, forbearance, and debt relief options. Borrowers have expressed frustration with the company’s communication and transparency2. Sometimes, they claim that Nelnet has mishandled their accounts or caused financial losses due to errors or poor customer service.

When analyzing some of the most common complaints about Nelnet, we found the following patterns:

  1. Difficulty in contacting customer service representatives
  2. Inaccurate or unclear information on loan accounts
  3. Disorganization in their processes, which leads to errors in billing, statements, and other documentation

Borrowers’ dissatisfaction with the company and its questionable advertising have contributed to the perception of Nelnet as a potential scam. However, it’s important to highlight that Nelnet is a legitimate student loan servicer, working with the U.S. Department of Education to manage federal student loans.

Our investigations show that while there might be some poor service and confusion, Nelnet is not a scam. Despite having some red flags, the company remains a bona fide organization handling student loans. As scam finders, we must always remain vigilant, but in this case, Nelnet scores a passable grade in the realm of legitimacy.

What Nelnet Controversies or Lawsuits Exist, if Any?

We have come across several lawsuits related to Nelnet. One of the most notable issues is a data breach between June 2021 and July 21, 2022. The data breach affected more than 2.5 million student loan borrowers, exposing their unencrypted and unredacted names, email addresses, phone numbers, and Social Security numbers.

Another major lawsuit focuses on how Nelnet deals with income-based repayment plans. The class action complaint Andrew Johannsson and others filed contains plausible allegations outlining a case against Nelnet for handling these income-based repayment plans.

Moreover, Nelnet has been accused of misleading borrowers into believing their student loans were federally backed and covered by the CARES Act. A lawsuit against Nelnet alleges that the companies have violated federal debt collection laws by misrepresenting their association with the Department of Education.

Some of the controversies and lawsuits associated with Nelnet include:

  1. Data breach exposing the personal information of over 2.5 million borrowers
  2. Mismanagement of income-based repayment plans
  3. Misrepresentation of affiliation with the U.S. Department of Education and the CARES Act

By examining these cases and controversies, we can better understand the legitimacy and reputation of Nelnet as a student loan servicer.

What Did We Find In Our Research of Nelnet?

Our investigation focused on several aspects: payment handling, account numbers, user experiences, loan payment options, loan forgiveness, site usability, refinancing options, and their role as federal student loan servicers.

Regarding payment and account handling, some borrowers reported issues with the Nelnet Servicing breach, which exposed the data of 2.5 million student loan accounts. This issue raises concerns for some users regarding security and data privacy.

Concerning the user experience, we analyzed the most common complaints and identified the following three issues:

  1. Difficulty in accessing accurate information about loan balances and payment histories
  2. Struggles with managing payment plans and setting up automatic payments
  3. Inadequate or unhelpful customer service when addressing problems and questions

We also explored loan forgiveness options offered by Nelnet, and we found that they do service loans that are eligible for forgiveness programs such as the Public Service Loan Forgiveness (PSLF). However, borrowers must diligently ensure they follow the appropriate steps and meet the eligibility criteria for these programs.

With refinancing options, Nelnet does not offer its refinancing products, but it does service and manage loans that have been refinanced through other lenders. As a federal student loan servicer, Nelnet has a contract with the U.S. Department of Education to manage and collect student loan payments. However, they have faced a class-action lawsuit alleging false representation of affiliation with the Department of Education, violating federal and state debt collection laws.

The site’s usability is user-friendly for borrowers to manage their accounts, track payment progress, and apply for income-driven repayment plans. However, some users have reported technical issues when accessing and navigating the site.

Our findings show that Nelnet has experienced some challenges, particularly in data security, customer service, and compliance with debt collection laws. We believe it is essential for borrowers to be aware of these issues and consider them when evaluating their loan servicer.

What Is The Company’s Scam Grade for Nelnet?

At first glance, we noticed that Nelnet is a legitimate company that partners with the U.S. government to provide federal student loan services. Both federal and private student loans are managed by Nelnet, including handling clients’ monthly payments, helping clients choose the best repayment plan, and processing requests for deferment or forbearance. However, we investigated further to check for any red flags or issues that may impact Nelnet’s scam grade.

We evaluated Nelnet’s communication practices by looking into how effectively they interact with borrowers online and via phone calls. Our research discovered that one of the primary complaints about Nelnet is related to its customer service and communication. Borrowers reported challenges when seeking clarity on essential aspects of their loans.

Another area we considered was Nelnet’s loan consolidation and student loan forgiveness services. Loan servicers like Nelnet are responsible for helping borrowers navigate loan consolidation, an option allowing them to combine their federal student loans into a single loan. Additionally, Nelnet assists borrowers in applying for loan forgiveness programs, such as Public Service Loan Forgiveness (PSLF) and Teacher Loan Forgiveness.

As we can see, Nelnet does not use deceptive practices, such as promising immediate loan forgiveness or posing as a government agency. However, it is worth mentioning that they have received many complaints related to loan servicing, though fewer than other major loan servicers like AES/PHEAA and Navient.

In our quest to determine Nelnet’s scam grade, we considered the following aspects:

  1. Legitimacy and government partnership
  2. Communication practices
  3. Loan consolidation and student loan forgiveness services offered

With the information we have gathered, we judge that while Nelnet is a legitimate company, it has room for improvement in communication and customer service. We would give Nelnet a Scam Grade of B-. While they are not a scam, they should strive to address the concerns reported by borrowers to improve their reputation.


  1. Nelnet Website – scam URL? : r/StudentLoans – Reddit
  2. The Top 3 Complaints About Nelnet – Student Loan Planner
  3. Resolved Nelnet Review: scam and cheating –
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