I've been looking over the posts on student loan rehabilitation, and I'm really confused... I'm hoping someone can answer my questions, since the woman at TransUnion was NO help, and didn't even know what "loan rehabilitation" was: Here's my background: I took out a student loan in 1996 for approximately $5000. I took two quarters off in 1997 and didn't make any payments on my loan. Then I returned to school (using my own funds) and graduated in 1999. I was an idiot and ignored the loan until early 2001. I decided to get the loan rehabilitated, thinking that this would clear up my bad credit (at least that was what I was promised by the collection agency who I dealt with.) Well, to make a long story short, my loan is now rehabilitated, and its been over 60 days and my Transunion report still shows the loan in collection. On top of that, the loan is listed twice on the credit report, once by the original bank (listed on the Transunion report as "3rd Party" - not much help as I don't remember who the orginal bank was!) as a chargeoff from 1998, when I was still in school - and then a second time after the loan was sold back to the Guarantor (at least I think thats how it works, let me know if I'm wrong about this.) I thought that the rehab would remove both of these delinquencies from my credit, but now I'm starting to worry that only the collection status from the Guarantor will be removed. Meaning that the original bad debt will still be listed on my credit report for at least 3 more years! Is this true? Is there anything I can do about it except wait 3 years for the charge to go away? And why would my loans be in collections while I was still going to school? And how long do I have to wait before my credit report shows any changes whatsoever? HELP!!!
I finished my rehab. about 4 months ago. I was in a similar situation to yours. I had to wait at least 2 months, but now all I have is ONE account that shows on-time payments since I got the first checks back in school! I actually had my entire tax refund seized- AFTER the rehab! (it was easy to fix and get back). I wish there was some good information and that the program was standardized. The way I understand it, The policies for rehab vary because anyone in charge can set the standards (schools, CA's). With some, you only get one chance, meaning if you are late one month, you are no longer in rehab and just have to live with the results on your CR (mine allowed one to start over if a payment was missed). I had a due date for 12 payments and the payment could not be more than 5 days early or late! They would not even let me pay a year up-front. It is a great opportunity, but is a very serious matter. If you start out on loan rehab, be sure to pay attention to the small details, as I have seen a few other people fail at it!
Hey Allisona, Did you ever get both of the derogs removed you reference in this post? I'm in the same boat and I just started the rehab. program. thanks, lucas
Once your loans are rehabbed, wait at least 2-3 months and pull all 3 reports, because at least one of the 3 will be reporting the loans incorrectly. I was able to get most of the derogs off my reports, but only after disputing with all 3 agencies. Transunion removed all student loan derogs after I disputed online. EQ removed all derogs after I wrote 2 letters, but then they started reporting my new student loan as "assigned to government," which took another month to correct. EX is the only CRA that I have still have problems with - they removed the derogs from the Guarantor, but when I disputed my Sallie Mae derogs (they owned before selling to the Guarantor) they verified. My EX FICO is pretty good, so I haven't pursued it. good luck!
Yeah, I just diputed all my student loan derogs (they have been rehabbed for about a year) with the 3 CRAs. TU and EQ have them listed in dispute and are verifying, EXP just sent me a letter that says they won't verify because "accoring to the fair credit reporting act...blah blah blah....we don't remove negative tradelines for 7 years....yadda yadda yadda...." PRICKS!
.....which leads me to my next question(s). Where do I go from here? I called EXP to get an idea of what they meant when they said the couldn't verify it, so am I flagged now? Can I not dispute these entries differently now? Should I wait 30 days before I try again? What do I do?!?!
Amish- What reason did you give Experian when you asked them to verify? I believe I said they weren't mine (it didn't work - Sallie Mae verified.) I've found that when I've tried to explain the rehab situation over the phone to reps at the CRA's, they never quite understand what I'm talking about, and I get nowhere. If they are refusing to remove the Guarantor derog, then they are clearly in the wrong. If you are trying to get them to remove the original loan derog, you are in for more of a fight. First, if I were you, I'd write a letter to EX asking for verification once more, and state somewhere in the letter that in accordance with Section 674.39 of the Loan rehabilitation Act, the default must be removed from your credit history. If that fails, you should write a goodwill letter to the original creditor and see if they will remove it.
Allisona, you are a GENIUS! I have never even HEARD of the Studen Loan Rehab Act, but I found it on Google (thanks to you!) and there it is, in black and white. PROPS!
