Student Loan (Long)

Discussion in 'Credit Talk' started by Kate, Aug 9, 2000.

  1. Kate

    Kate Well-Known Member

    This is the situation. I had a series of students loans from 1983-1987. I never got a chance to pay on the loan before they were defaulted. I was unaware of what was going on. At one time, I called the original lender and was told they had no record of my taking out a student loan. (These loans were sold repeatedly)

    They were finally turned over to the State of VA for collections. One day in 1991, I received a call from the state saying I had a defaulted student loan and I needed to pay the entire balance or have my state income tax held. They did with hold my state income tax return in 1992, 1993, 1994, and 1995. They with held my federal in 1994, 1995, and 1996. Sometime between 1994 and 1995 it was turned over to the feds.

    I stopped working in 1996 due to an injury I sustained while working.

    I recently attained a copy of my credit report and it shows the loan status: paid/collections account. Collection as of July 1995. This is erroneous I know they withheld money in 1996. This is supposed to stay on my credit report until July 2002.

    How can I determine the original default date? How can I get this off my CR. I want to pay this debt but, I have no way of knowing what is an accurate balance and what collection companies have tacked on to it.
  2. Steven Z

    Steven Z Guest

    "I stopped working in 1996 due to an injury I sustained while working."

    It may be possible that you qualify as a 'hardship case' and will not have to pay the debt; which is no doubt many times the original considering all the commissions the numerous companies tacked on and compounded interest.

    If not, I'm certain others can give you a clearer picture.
  3. Josh

    Josh Guest

    Boy -

    I'm going through something similar. I've paid my Student Loans. They defaulted in '91 and '93 according to the lady at the student aid commission yesterday. (I asked her to send a letter.)

    I've disputed the start date several times now with the CRA's and each time, it comes back "Verified".

    I'm want to sue.

    I realize that removing an item from your credit report takes time... but I fail to see the logic that states that I must pay for somebody elses mistake. I've paid for my own mistake for 7 years.

    Anyhow, I'm just ranting now. Any lawyers interested in suing?
  4. Kate

    Kate Well-Known Member


    I sympathize with your pain. The thing I do not understand is when, something is put on your credit report is it from the default date or the date that it goes into collections?

    In my case it went to the state education department and than to Federal off-set. I later found that out doing my own research but, I was never able to find out what dates.
    Now, it is listed on my CR by some bank. They sent it to collections in July 1995. I never heard a thing from this bank.
  5. steve

    steve Well-Known Member

    Kate and Josh. There is no statute of limitations for collections on a defaulted student loan. Also, the statute of limitations on reporting student loans is 7 years but does not begin until the loans are paid off. But there are all sorts of tricks you should be aware of. 1) Many student loan servicing organizations regard the term "paid in full" to only refer to the principle balance. 2) If you consolidate your loan, many servicers will assess a collection fee after the loan is consolidated and not include it in the consolidation. This will show up on your Equifax credit report as zero balance but 120 days past due. Then in the explanation collumn, it will state paid in full. I had a guy at Fair Isaac (FICO score people) tell me one 90 day past due status reported 6 months ago is far worse than 100 90 day past due comments 3 years ago. So, the zero balance doesn't really help. The status and date reported are what matter. This really screws up your score. 3) Student loan servicers will often overcharge you collection fees, interest, late charges, whatever they can think up. 4) They frequently try to engineer defaults--meaning they engage in all sorts of deceptive tricks to make you think you loan is already in default so you don't do anything and then it really does default. Student loan organizations make companies like Cross Country Bank look like angels. 1st thing to do. Find out who owns your loans now, and who owned them before. Get appointments to review your file at every place that ever had a claim on your loans or serviced them. Get a copy of your promissory notes. Find out what the correct commission was supposed to be and if due diligence was performed including "pre-claims assistance." If you were overcharged or due diligence was not performed, you should sue for breach of contract. Email me if you want and I can get a student loan specialist contact you. I'm in a lawsuit right now with the guarantor of my loans and may convert it to a class action. Contact me if you want to be on my list of 40+ victims. I am close to having a negotiator try and negotiate a structured settlement on behalf of all the victims I've been in contact with. Good Luck. Oh. You should complain to the Guarantor and Lender Oversight Division of the Dept of Education about being unable to get a statement of amounts due from the servicer(s) among other things. Demand an investigation. Your case will be stronger after they blow you off.

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