I am supposed to close on a house loan on the 24th and I just got an update that I have a late on my student loan. I have my payment confirmation stating that I paid within the 30 days. I think because of the Passover weekend and the fact that my school was involved in the student loan scandal and the head of our financial aid and loan administration was dismissed, their payments may have been processed late and the computer automatically sent a late to T/U. It dropped by score by about 90 points (733 to 646), making me ineligible for the loan product. Also, they have this separated out as two loans, even though I make one payment, so reporting the late has the effect of dropping my score on 2 trade lines, not just 1. Is there a way to get this immediately removed? If I dispute, does T/U have to remove the negative reporting immediately until verified? My closing is supposed to be one week from today. ANY HELP would be appreciated.
Well, to the main issue of your closing, this new error should have no effect on the closing. If you are clsoing next Friday, then your loan has already been processed, and is based upon your credit report at time of application. The only thing the lender usually does is an "employment verification" 24-48 hours before the closing. So, I wouldn't worry about the effect on your closing. But, to be safe ( and for your peace of mind), I would enter a dispute on-line, "never late" with all the CRAs that report this. This way, even IF they pull your report/score, the account will be marked "In Dispute" and will not be taken into factoring. Don't worry, the closing will be fine, but do take care of this, with a new home don't let this slip off the plate.
Thanks for the info. But this was supposed to close a couple of months ago, and there was a title problem with the seller. They cleared title and the mortgage co is re-pulling my credit. That is how I know about the problem. And this loan product is completely credit based. They are a small company, so I dont what I should do. In your post you said if I dispute it, it isnt used in factoring the score? Is that the case? Do you know how long that takes if I dispute online? I actually have my payment confirmation saved as a PDF because I pay my bills online. Do you know what I should do if I paid and scheduled on a Friday and the payment didnt show in my bank until Tuesday? Does it matter? Some bills I pay and I can see it went through 15 minutes later. These people seem to take forever in their processing. Thanks again!
Since CRs only show "lates" as "30 days late", etc., if they got it before 30 days after the due date, your position is that reporting it "late" is erroneous. When did you direct your bank to pay, relative to your due date? Was this an electronic transfer, or did your bank cut a check, and mail it? When does the lender show it as received and posted, relative to the due date, and relative to 30 days after the due date? When does your bank show it as clearing? Is your school directly involved in the loan servicing, or do payments go to the lender?
I paid the account on the next to last day of the 30-day grace period. My school uses a servicer, and I pay online directly to the servicer on their site. It shows the payment scheduled for that last day (a Friday), but doesnt show a posting until the following Tuesday or Wednesday. I have to double check my bank statements. In any case, I scheduled a payment on the website of the servicer for that day. I have no idea how or when they process or who they use, but their receipt states the date of the scheduled payment. On other accounts, say, my mortgage, I pay online and an hour later, that money is unavailable in my account and the next morning, it is gone. The day I pay doesnt matter. Same for most of my other bills I pay online, like a phone bill and even my other student loan. The issue is that if I schedule a payment with someone, I have no control over when or how they process that payment, especially considering it was Easter that weekend. It's kind of like sending a check to someone and they cash it one month later. Can they claim you didnt pay them, or that they didnt cash the check to receive payment from you? This has happened once or twice in the past, and I have been fortunate to successfully get it removed by going through the process and sending letters to both my school and the servicer. Once they made a huge mistake on my account about three years ago (when I sent checks) and it took forever to get it removed. It turned out they were crediting the wrong account one month and put down as having 60 day lates. I think I can successfully argue this, but my issue is also time. I am trying to determine the best approach so that I can close on the loan and have this removed from my CR. Thanks.
What time of day did you schedule/make the payment? If it was after 2:00-3:00PM it very well could be counted as the "next business day" The day paid by your bank won't help you completely, it has to do with timeliness of receipt. I am still a bit suprised that they are pulling your credit report again for the loan approval, this seems like it should have been done by now. Was there any changesin price or terms? You have to be careful on scheduling e-payments; make sure you look at the "date" function/field AFTER you enter your date! Often it will change to the "next business day", especially on holiday weekends.
First, is this showing up on all 3 bureau reports? Which agency (Experian, Equifax, Trans Union) is it showing up on? If you dispute the tradeline as in error, it is not supposed to be factored into your credit score, (though there is some question regarding this, and how true). First, you should try to contact the loan servicer, and straighten this out with them, explain your closing situation, and ASK for their HELP, if they agree to remove, request an e-mail or fax to you and your lender. Depending upon the credit reporting agency, you may be able to expedite this by calling, and requesting to speak with a mortgage processing representative. Other posters have had some luck with this for rapid removal of negative items. You'll have to put in some fast work to clear this up, but you should be able to get this taken care of.
OK. I just called the services and got a really nice guy who wants to go home. I told him my situation and said he is going to try to remove it for me. I also made the argument that there was no other way for me to make an immediate payment on that day because they closed early for Good Friday. I'll post back on Monday or Tuesday after he speaks to his supervisor and calls me. Thank you. Thank you. Thank you! The last day for the mortgage co to pull credit is Wednesday for a Friday closing. My guess is the removal wont show up immediately on T/U, but they will give me a letter. This has been the only change on my report since the initial pull, so I think the mortgage co will use my old score. I dont know how it works. Can the servicer update more immediately? Thanks again!!!
Oh, and yes, it does change the terms of the mortgage: NO MORTGAGE. This is a small mortgage co that only does loans for ppl with credit scores 700 or above.
Some posters on this site have claimed that some of the CRAs have a department to accelerate correcting credit report errors when they may affect pending mortgages. Once you get agreement from the student loan lender to remove, and a letter to that effect, you would probably want your new lender aware of the pending correction, but you might also try accelerating the correction by the CRA. Search in recent posts, over the last week or so, for further information.
Two of the CRA's do have the ability to pull the lates off your credit report immediately for immediate reporting and credit pulls. They may require you to fax them something showing that you did in fact make the payment on time. In this specific instance, the Rapid Rescore may also be helpful because of the very short timeframe until closing. Bizwiz---in NY it is actually becoming more customary for credit to be pulled just before closing...I've been told that it's mainly when you use a broker vice a direct lender, which is what most people do. Mainly because the actual lender never pulls the credit report, but rather goes by what the morgage broker puts on the loan application and then just before closing, they want to make sure that to borrower didn't just go out and make another large purchase and throw their debt to income ratio way out of whack. Esimo---if you want more detailed info on it, let me know and i'll walk you through exactly what I did. Make sure you play on their heart strings when you talk to them and kill them with kindness. GOOD LUCK!!!
Thanks Joey, I'm sure the recent mortgage industry issues have made this practice more of a norm. It does make sense! (just like the employment verification).
Honestly, I think is is important for the mortgage industry to become a little more strict in their practices. The amount of foreclosure sales that I have seen in the last two years is absolutely rediculous. The unfortunate part is that the buyers weren't truely educated on the loan products they were being sold, and as a result did not make smart choices. They now have to pay the price for a long time......it's unfortunate.
