I just wanted to know if everyone that attempted to rehab a defaulted loan was given a rehab agreement before making the 12 payments. I have spoke with the CA (Nationwide) and my gauranteor (NYS Higher ED) - neither will provide anything in writing. The CA just tells me to mail in the payments for the agreed amount. I have requested that they provide in writing the payment amount , due date , balance , etc. I have been informed that will not provide anything in writing. NYS Higher Ed states they will provide a Rehab. application once the 12 payments are made - nothing prior. I would like any input on this matter. Please let me know what I should do to protect myself before starting into Rehab thru the CA. Does that the Dept of Ed. have a Rehab form used to start this process ? I have contacted the ombudsman office - they have assisgned someone to my case , but this has been going on for 3 weeks and they have no progress. When I speak to my investigator - she tells me information not related (like to request a lower payment amount)??? I have already agreed to pay approx 2% of the balance which is reasonable. 1% is the min. per the CA. Thanks Chuck
My guarantor wouldn't even deal with me, they did fax me a statement, it was higher than what the CA told me. I had to go thru the CA. They did send me a rehab agreement to sign, but both the guarantor and the CA told me that the rehab agreement would not go into effect until all 12 payments were received. From what I hear it's what happens after you make all of your payments that matters, make sure they update all of your credit reports correctly. I got a form, I filled in the date I would send the payment and the amount per month, and signed it, they signed it also. Basically it is an agreement that you will make your 12 consecutive payments on time, if you don't the clock starts over. When your account is picked up by another lender after the 12 payments, then you are in rehab, they wipe your record clean. I had to call the CA twice and talk to 2 different people to get an agreement sent to me. Try calling the CA back and talk to somebody other than the person you have been dealing with. These guys are on commision, they are just collection agents. Do you know the hours the person assigned to your case is working? call when he is not working and request a rehab agreement, I'm sure they have them. The second person I talked to was much nicer than the first. I've got stories about that.
I wanted so badly to rehab my student loans, but the collection agency that was holding them (NCO) told me that it would cost me over $650.00/month to do it. This was an impossible amount for me to pay. My only alternative was to consolidate the loans through the Federal Direct Loan Program. Sure I get a positive listing from them, but I suppose my old loans through PHEAA will always show I defaulted. Looks like it's tough luck for me.
NO, I think that's wrong Andrew. The amount you pay per month is supposed to be a number negotiated between you and them. The rehab guidelines state that since the debtor is obligated to pay 12 consecutive payments, the agreed-upon amount should be reasonable for the person to pay. I've defaulted on my loans (about $12K) and it only costs me $300/month. Your income plays a part in what they would like you to pay but I thought it was negotiable to an extent. Tom
Please go to the following site (Dept of Ed) http://www.loanconsolidation.ed.gov rehab your loan there. They send you all paperwork and you an visit the site to see the status of your loan and application. Has worked fabulously for me.
Maybe it depends on the guarantor? When I started rehab on my loans ($12000) the guarantor sent me a form stating that I was entering rehab on XX/XX/XX and that once 12 consecutive on time payments had been made, the loans would be considered rehabilitated and all negative information related to them would be removed from my credit reports. It also stated that once 6 consecutive on time payments were made I would then be eligible for federal funding and that they would send a notice to that effect to the school of my choice! They set the payment amount ($150) but I don't know how they came up with that amount. So I guess that I am sitting pretty good right? I have the letter, I have my check copies, so when I have 12 if they don't remove it I will have all the ammo I need to dispute. I don't know if this helps at all. Larissa
Larissa, I'm currently finishing up my rehab with ERS. Be sure you follow up with them regarding the rehab agreement that needs to be signed by you and send by them after the 12th payment is made. It's sent back to the D of Ed and that's what starts the process to finish the rehab. Did they tell you it might be a month or two after the 12th payment before the rehab is issued? If so, don't panic; that's a common timeframe to do allthe paperwork. Just keep sending in your payments to the CA until you get your payment coupon booklet from the new lender. Good luck - it's a great feeling to get that monkey off your back. I'm doing my happy dance tomorrow! Kate
thanks Kate! I think they may have told me that in the letter...I would have to go back and read it again (of course I kept it in a special file "just in case") I will be so glad when it is done...other than my two paid judgements this is the only bad thing on my credit, and I still can't get any credit cards, I am hoping it will improve things greatly. My huband has far more bad things (late pays, collections) on his credit and yet he can get credit cards...not that CC are that important, I prefer to pay cash, but we want to buy a home and so need to get our credit up there...
Don't you just love those special files? I have mine in a plastic, 2 inch thick legal file case, because of all the problems i've had with them! It's been a nightmare. If you run into any problems, contact the Client Service department and head up the chain of command. And of course, those wonderful certified letters with return receipt! With regards to the credit reports, the woman I spoke to last week at the Department of Edu default loan department (!) told me that once the rehab goes through it will be reported as paying as agreed never late, or whatever the bureaus put as in good standing. HOWEVER, if it's been more than 7 years, they will just delete it. That's what happened to me when I disputed them - just to see what would happen. They came off all three bureaus! But, it was due to the fact it had been more than 7 years. Good luck!
hehe... I have "special files" coming out of my ears! Mine are only from 98 (well that is when they went in default) so they will show up paid as agreed/never late then? That will give me two positive tradelines then right? Which is good since I only have 2 now. Thanks for the encouragement and congratulations to all who have been through this and triumphed! Larissa
I disagree! I consolidated through Direct Loans and the paperwork said that I had to Rehab my student loans BEFORE consolidation in order to have my credit file cleared...but I could not afford $650+ per month so I had no choice... My loans are consolidated, but reported as PAID COLLECTION/DEFAULTED LOAN Did NCO lie to me about the $650?
Chuck- sounds fishy to me that they won't give you anything in writing..how are you supposed to prove the agreement? Andrew- $650 sounds like alot...how much were the loans? I have heard NCO is a pain in the A** so I wouldn't put it past them to lie. Larissa
There is a law in place regarding rehabilitation so as long as you have your cancelled checks, you're OK. The payments you make aren't the actual rehab of the loan. Basically, you need to make the payments before applying for rehab. You aren't considered rehabbed until AFTER you make the payment and apply. The rehab isn't something they do for you because they are nice, it is required by law. Tom
This is my story: Student loans went to collections (default?) in 2000, after 3 yrs of nonpayment (I got divorced and moved to another town and didn't remember to change all addresses)... I was contacted by a collection agency (can't remember the name off the top of my head, but they are on the US Gov't approved list of agencies for student loan collections--CSA?). They offered me to get my loans out of collections. but I had to: 1) make a payment of $550.00 for "good intent". This was explained to me as to prove I was serious about the repayment . 2) had to make 6 payments by predating checks (I know,bad bad, but they were gov't approved). 3) after that, I was supposed to make arrangements for another 6 checks to complete the rehabilitation. BUT I got lucky; after the first 6 payments, I consolidated my loans, and that made them all current. After looking at my credit report recently, I saw that they had both my consolidated loan and the previous ones!! I just contacted the Fed loan people, and they said to contact the originator of the loans to have them remove them from the reports as they ARE payed off... Hope this made sense Deb
