OREANDA-NEWS. Fitch Ratings affirms the Nelnet Student Loan Trust 2007-1 senior notes at 'AAAsf' and the subordinate notes at 'Asf'. The Rating Outlook remains Stable for both classes.

KEY RATING DRIVERS
High Collateral Quality: The trust collateral is comprised of 100% of Federal Family Education Loan Program (FFELP) loans. The credit quality of the trust collateral is high, in Fitch's opinion, based on the guarantees provided by the transaction's eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch rates the U.S. sovereign government at 'AAA' with Outlook Stable.

Sufficient Credit Enhancement: CE is provided by overcollateralization (OC; the excess of trust's asset balance over bond balance) and excess spread, and for the senior notes, subordination of the class B notes. As of January 2015, total parity is 100.05% (0.05% CE) and senior parity is 104.86% (4.63% CE). The trust has been releasing cash, as the target OC has been maintained. Since the stepdown date of May 2013 has passed, class A and B notes are being paid down pro-rata.

Adequate Liquidity Support: Liquidity support is provided by a Debt Service Reserve Fund currently sized at the greater of 0.25% of the pool balance and \$3,623,145.56, currently equal to the floor.

Acceptable Servicing Capabilities: National Education Loan Network, as master servicer, and Nelnet Inc, as subservicer, are responsible for day-to-day servicing of the trust. Fitch believes both National Education Loan Network and Nelnet Inc. to be acceptable servicers of FFELP student loans.

RATING SENSITIVITIES
Since the FFELP student loan ABS relies on the U.S. government to reimburse defaults, 'AAAsf' FFELP ABS ratings will likely move in tandem with the 'AAA' U.S. sovereign rating. Aside from the U.S. sovereign rating, defaults and basis risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults and basis shock beyond Fitch's published stresses could result in future downgrades. Likewise, a buildup of credit enhancement driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

Fitch has affirmed the following ratings:

Nelnet Student Loan Trust 2007-1:
--Class A-2 at 'AAAsf'; Outlook Stable;
--Class A-3 at 'AAAsf'; Outlook Stable
--Class A-4 at 'AAAsf'; Outlook Stable;
--Class B-1 at 'Asf'; Outlook Stable;
--Class B-2 at 'Asf'; Outlook Stable.