When I was 21, I went into default on a student loan. I avoided it for 10 years. I started paying it off three years ago, and have managed to bring it from $10,200 down to $2600 today. This is about 7/8 of what makes me sub-prime now. I was very excited to hear about loan rehab from the Carreon site, I called the Guaranty agency to see if I could do the loan rehab because I have paid this religiously for 3 years, the guy said I wasn't eligible, because the agency policy was to not allow this for loans where a judgement was filed. No one told me about a judgement. No papers were served. He said he'd ask his boss, but he was sure they wouldn't allow it. Has anyone dealt with this before? If I can get this into rehab, I'm prime. I could actually ditch my 13 year old car. Thanks for any advice.
When you default on a student loan you can cure the default through one of 3 ways: 1) pay cash in full, 2) reconsolidate by first entering into a repayment plan and making a series of on time payments, 3) rehabilitate by making a series of on-time payments leading to reconsolidation (now 12 payments). If you rehab, supposedly, all derogatory info get removed from your credit report (but it rarely ever does--it is a misrpresented myth which will end in legal disputes up the a** for the Dept of Education and the credit bureaus). It you are already reconsolidated (and I believe you are), like me, the time to rehab is lost forever. However, if the credit you paid off in order to reconsolidate still persists in reporting further derogatory information to the credit bureaus (which they usually do), then they have violated the Higher Education Act and the FCRA in turn and you can sue for damages including breach of contract. Do they report you 120 days past due with a zero balance? Contact me if this is the case. stephen_m_anderson@msn.com. I am collecting credit reports from people, so we can go after Equifax as a group and possibly the Dept of Education.
