Part one: Ok,, I found the latest revised as 1/2001 legislation on this issue of guarantors responsiblities as far as CRA reporting: ************************** (5) Credit bureau reports. (i) After the completion of the procedures in paragraph (b)(5)(ii) of this section, the guaranty agency shall, after it has paid a default claim, report promptly, but not less than sixty days after completion of the procedures in paragraph (b)(6)(v) of this section, and on a regular basis, to all national credit bureaus-- (A) The total amount of loans made to the borrower and the remaining balance of those loans; (B) The date of default; (C) Information concerning collection of the loan, including the repayment status of the loan;!!!!!! (D) Any changes or corrections in the information reported by the agency that result from information received after the initial report;!!!! (E) The date the loan is fully repaid by or on behalf of the borrower or discharged by reason of the borrower's death, bankruptcy,total and permanent disability, or closed school or false certification. ****************** (ii) The guaranty agency, after it pays a default claim on a loan but BEFORE it reports the default to a credit bureau or assesses collection costs against a borrower, shall, within the timeframe specified in paragraph (b)(6)(v) of this section, provide the borrower with-- (A) Written notice that meets the requirements of paragraph(b)(5)(vi) of this section regarding the proposed actions; (B) An opportunity to inspect and copy agency records pertaining to the loan obligation; (C) An opportunity for an administrative review of the legal enforceability or past-due status of the loan obligation; and (D) An opportunity to enter into a repayment agreement on terms satisfactory to the agency. ****************************** (iv)(A) In response to a request submitted by a borrower, after the deadlines established under agency rules, for access to records, an administrative review, or for an opportunity to enter into a repayment agreement, the agency shall provide the requested relief BUT MAY continue reporting the debt to credit bureaus UNTIL it determines that the Borrower has demonstrated that the loan obligation is not legally enforceable or that alternative repayment arrangements satisfactory to the agency have been made with the borrower.
Part two: Ok guys critic my thinking of the legislation in part one.. Ok, a student loan defaults with the original lender,, they make a claim to guarantor,, then BEFORE the guarantor can add a new Neg tradeline on CRAs, they have to write to you and give you 60days ( I once got this letter but the funny thing is the tradeline had already been on CRAs for 2yrs) to dispute, to be heard or to enter a repayment they like,, ( another gray area, its up to the guarantor to agree Ok its a satisfactory amount, so If they say,, hummm 1000 a month that it,,) but if during those 60 days you enter a repayment agreement the tradeline doesnt go on your CRAs?????? OK, now part two,, whoever the guarantor is, after they enter the debt tradeline, if you come back to them and enter a satisfactory repayment agreement, then as its worded, they may report to CRAs UNTIL the alternative repayment arrangments are made...... OK I see the game with the US dept of ed,,, with their Rehab,, they will Update the Neg tradeline, to positive under their guidelines of what satisfactory repayment arrangments are, 12 months of payments,,,, but the tradeline remains??? doesnt this legislation clearly say "the debt" may be reported until satisf,, repayment arangements,,, it doesnt say,, Neg info to this debt will be reported until satis payments??? I take it, this legislation is only in relation to debt tradelines by the Guarantor, not the original lender and not the final MAN, the dept of Ed???? also,, let me ask you guys,,,,, OK, you can rehab a defaulted loan with the guarantor or dept of ed,, OK, for 12 months payments, the negs will be removed,, but not the tradeline, which contradicts the a/m,,, so whats the benefit to the person, that immed,, enters repayment/rehab in those first 60 days, No new tradeline? but the original lender charge off remains?? Once again, I take it this only pertains to tradelines for Guarantors,,,,,,, but in the least,,,,,, for all of you that have paid,, like those with paid 120 days late etc,,,,,,, THE TRADELINE SHOULDNT EVEN BE THERE,, hell whats more of a satisfactory payment agreement,, then paying the loan off in full!!!!! The gray area is what does the Guarator define satsifac,, payment made with the borrower? I know in rehab with US dept of ed it cant be less than 50 bucks a loan,, but again the tradeline remains, I will call US dept of ed, and ask these Questions, your input on experiences is helpful,, lets keep this thread going,,,,,
OHHH this is sad,,, I was told by the CA for dept of ed, that after rehab 12 payments all negs would disappear, they sent me the written agreement,, now I read about the whole thing with guarantors,, I really wanted the 3 tradelines with dept of ed to remain with paying as agreed,, Date opened 1988,,, for credit history,, well I just went to the US dept of ed site on defaulted loans,,,,, sounds exactly like this guarantor legislation,, once you reach satisfactory repayment agreement, ( 12 months) THEY DO DELETE the tradeline, sell the loan, Great,, I will lose the history,, lose points, and get three brand new loan tradelines ,,,uhhh Loans held by US dept of ed Loan Rehabilitation You may also be interested in participating in the loan rehabilitation program. After you have made 12 consecutive monthly payments that are both reasonable and affordable, we will agree to reinsure the loan. You will then be eligible to have the loan purchased by a lending institution. Once a loan is rehabilitated, it will be taken out of default, the credit bureau reports made by the servicing agency will be DELETED, you will be able to repay the loan over a 9 year period, and you will again be eligible for additional Title IV student financial aid funds. ****** but here is something interesting***** Repaying Defaulted Student Loans Held By a Guaranty Agency Under the Federal Family Education Loan (FFEL) Program, after your student loan is placed in default by the holder of the loan, an insurance claim for the amount of the loan is paid by the guaranty agency (the organization that administers the FFEL Program for your state) to the holder of the loan. To find out more about your repayment options for your loan held by a guaranty agency, please call the agency servicing your loan. **** theres no mention of rehab with guarantors,, great, so what defines reasonable with guarantor,, humm but remember theres no defination, like 12 months,,, I wonder if you can get them to sign to we agree this is a reasonable amount, blah,, and then sent it the the CRAs with a copy of this legislation,,,
Student loans are the only major derogs that I have not yet figured out how to tackle. I remember a CA telling me there is no SOL on student loans. I then looked it up an came to the conclusion that it may be true. However after reading this thread I intend on reinvestigating. Alot of us are being penalized over and over again. I have a student loan that I was going to start the rehab program on and now I am having to rethink that. Is there ANYONE out there who can make sense of all this garbage. Some on us are really lost on this subject. MAC, thanks for bringing this topic up and here is a bump to keep it alive, because these loans are killing me.
rond1234 There are basically 2 types of Federally Guaranteed Stafford Loans. There are Direct Stafford Loans and there are FFELP Stafford Loans. Direct loans are just that, disbursed directly from the Federal Government. FFELP stands for Federal Family Educational Laon Program. These loans are issued by private lenders and are also guaranteed by the Federal Government. However, there are close to 300 issuers and servicers of FFELP Stafford Loans and Sallie Mae is just one of them. Basically, the only diference between them is who issues the loans and writes the check so to speak. Since these loans are also Federally Guaranteed, they are considered Federal debt. Hope this answers your question. If not, then I will go into further detail if needed. fla-tan
Im in heavy thought now,, I bulked immed,, at the idea of Consolidation,, three payments then consolidate these,,, I bulked because the (1) the CA (FAMS) part of OSI,, made me a deal, in writing,, if I pay 369 a month for 12 months,, on loan on 3000 blown up by CA costs and interest to 8000!! that they will waive the 25% ca fee,,, plus the neg 120 late will be removed,, so I said to myself,,,, " OK suffer for 12 months, 369 vs 50 a month,, the money is going to the loan,, I didnt want to pay any CA fee,, and when its over,, three paying as agreed tradelines from D opened 1988, then I would consolidate,, and have these three reported for 10yrs,,,,,,,, well now I know that aint the way it is,,,,,, the tradelines will disappear!! massively killing my average credit history length,,, now I am wondering..... the big neggy with consolidation was after three payments,, the tradelines, will read, acct closed, zero balance,, 120 + late,,,,, the neg info will remain,,,, A new line will be created,, for a brand new loan,,,, I am wondering which is worse for my credit,, I am lost,, my options are,, 1. cont paying, then the old tradelines will be deleted, killing my history,,,,,, Score Lowered, possibly massively, combined w/ the score killer of a new loan,,,, ( the tradelines are due to fall off 8/2004 with dept of ed,, of course its wrong cause the original sallie mae lines say 1/2004 which is corrrect,, 7 yrs since charge off/default/) 2.. I consolidate,, the tradelines remain with neg info, but zero balance, (perhaps not hurting my score itself,, its old from 1997,,, AS LONG AS GOD FORBID they dont re age, and its another 7 years of neg info from the day of consolidation,,) and add a new consolidation,, score killer,,, I think its just a matter of time, if I go thru re hab, then the lines disappear,, killer,, regardless, if I consolidate them,, they are there till 2004 then death when the are deleted, I am lost, cant sleep,,,,,,, I have even gone into the best with student loans yet!!!! and another CA,, in the FCRA 1998 is says all debt 7yr180days, but at the bottom it says, except neg lines student loans are longer,, pls see Higher education act, 430A(f) 463c(cc) 3 yah wish me luck trying to find them if not abbr in higher ed act,,,,,,,, uhhhhhhhh so aggravating,,,, lil
Lil, I'd go with option (1). Having those lines deleted may drop your score in the short-term, however, if they stay (you go with option 2), who's to say how they'll get reported and for how long... I've had closed, fully paid, student loans reported in all kinds of crazy ways (e.g., one was being reported as currently 120 days past due, another had no information except for an account # and original balance, etc.) So, I think the safer route would be to just get any of the derog tradelines deleted entirely if you can...
yah,,, and heres the biggest joke of them all, Im in Europe,,,,,, so far 3 times, one I got back in the mail yesterday,, I sent the payments to greenville tx,, they keep getting returned,, I dont know why,, by the time I get them back,, Im late,, pushing teh 15 day late shit,,,,,, and everytime I call the Ca in Atlanta,, they say quick collect,,,,, its not quick collect here its Quick PAy,,,, and US dept of ed doesnt do Quick Pay, the codes dont work, I had a break down at the line in western union,,,, not to mention about ( yes) 100 bucks in phone calls, the 800 numbers arent free here, its actually a hell of a lot more then If I just call a normal US number,,,,, I feel like giving up all together, but I cant,,, noone can give a reason why they get sent back,, and of course you cant talk ot anyone in texas,, its gotta be some mail processing thing, the letter size the stamp, I was told it a letter processer and even if you are in usa it can read if you dont have proper stamps because god forbid the US dept of ed has to pay for postage due when they get your payment, but I always put the correct postage, the envelope comes back from the Post office in greenville, return to sender thats it,,,,, so my only option is to send Fed ex, 100 dollars a letter!!!! from europe,,, to make a payment for 169!!! sorry I had to vent,,,,, but Im saving everything, so when the day comes I get a letter your no longer in rehab, late payments, whatever,,, I have the proof to fight with,,,,,
Lil-Gong, Fla-tan and all those working on this thread. Need some help. I have been reading this thread over and over again and decided to investigate my loans. 1. Sallie Mae was the orin. service that I defaulted on, ICAC is the guarntor and paid sallie mae. (Now show 0 bal. and derog. payment history) 2. ICAC has now turned the loan over to OSI for collection, OSI overferred rehabb program. OSI is not reporting only ICAC Here is where it gets tricky. The loans (4) were originally take out in 1992-1993 and 1993-1994. I was to begin payment in 2/1995, did not and defaulted. In 3/1997 ICAC ((the guarantor (they say) paid Sallie Mae, therefore owning the loan)) Since they state the bought the loan in 3/97 they have been trying to collect on the loan and have received some payments thru tax return and me, last payment being 6/99. On the CR it states the date opened as 3/97. Now wasn't the original debt in 1992, 1993, 1993, 1994. My question is Is that not re-aging? I called ICAC and they of course said no because they had no interest in the loan until they bought it in 3/1997. What is also funny is that ICAC said they are the guarntor, but on the CRs it has them reporting tl, with a note saying Orginal Creditor: 123 Bank. If you are the guarantor who cares who was the OC?!! They (ICAC) also report on EQ defaulted loan-claim filed against guarantor, Now why do this notation if you are the gauarantor? Why not simple create the new tl, which they did and report the late payments. what is with all the default crap. anyway just me venting and looking for answers. Any help would be appreciated as this is 4 huge negative tl I would love to delete.
ICAC should be reporting the same open date as the OC (the open date doesn't change just because they bought it. Unless, again, there are some differenet rules for federally guaranteed Student Loans). But, you are re-habbing right? When you get done with that, then I'd go after them to fix the open date.
Scout, if it went back to the original date it would have fallen off by now. When they re-aged it added almost three years. If you with the true dola being in 1995 they would be falling off this year not 2 yrs from now. Any Ideas what to do?
kbanger As I understand the way Stafford loans in default work, what happens is that with default technically a new loan is created. This occurs when the guarantor pays off the loan. Since you and the borrower didn't pay the loan it stays as a negative on your file. You now have 2 negatives, the original student loan with the servicer/lender and the "new" defaulted student loan with the guarantor. This is somewhat the way that Congress created the HEA and also how the Dept of Ed interpreted the act. Hope this explains it a little. fla-tan
But, in any event, the loan was paid in full. Why should the guarantor AND the original holder both get to report it as a charge-off? I can see it being I9 with the original holder and I5 (collection) with the guarantor. Maybe if it goes unpaid long enough the guarantor will charge it off, but I don't think it works that way. So, even though they completely close the loan and issue a new one, they don't change the opening date? This hardly makes any sense. In essense they are saying it's the same loan, but for whatever reason, probably book keeping, they are treating it as a new loan. What would be true reporting is for a single loan to show ALL late payments and the default, over the life of the loan in all it's incarnations, in addition to your current or last reported status.
Jambe I agree with you, because one loan can tend to look like two or three, depending on how many times it is sold. And everytime a default happens, they re-age saying it is a new loan. Which I of course think is BS
