The Higher Education Act of 1965, states that paying your student loan does not delete the TL reference but only update to say PAID. I paid my loan off in 2002 and it still reads charged-off, collection account. Paid but negative none the less. I would like it off my report if it should be. I checked my score today and on EQ Iâ??m at 600. I need to be at 620 to refinance my house. I don't know if this will get me there but I'm hoping. Still working with Ombudsman but slow. So, my question is if the loan is paid, is the SOL on how long the TL is reported still 7 years from payment or from default like FRCA states? Which law has precedence? (f) Duration of authority Notwithstanding paragraphs (4) and (6) [1] of subsection (a) of section 605 of the Fair Credit Reporting Act (15 U.S.C. 1681c (a)(4), (a)(6)), a consumer reporting agency may make a report containing information received from the Secretary or a guaranty agency, eligible lender, or subsequent holder regarding the status of a borrowerâ??s defaulted account on a loan guaranteed under this part untilâ?? (3) in the case of a borrower who reenters repayment after defaulting on a loan and subsequently goes into default on such loan, 7 years from the date the loan entered default such subsequent time.
This seems to say that the 7 year period would still be from the default date. I know that student loans have some nuances I'm not real familiar with. When did it charge off? Is there any indication on your credit reports when it is scheduled to fall off?
Loan defaulted in 98 and alleged charged-off in 2002. The year the loan was paid. This 2002 seems ridiculous given that it was defaulted in 98. How could it take 4 years to charge-off?
I believe that rehabilitated loans are eligible to have the derogatory notations removed after two years of on time payments. It may only be one but, I would certainly contact the furnisher and see if the above is applicable.
He would have had to go through a formal rehab process. If he just paid them off without rehabbing, then it wouldn't apply. OP, it really does sound like this is a case of reaging to the paid date. Do you have any documentation showing the 98 default date?
Yes have payment history letter dating back to 96 origination. However DSL claim the loan reset another 7 years when I paid it off in 2002 and the the TL does not go away.
I didn't go through the rehab but the loan was consolidated in 1996. Then I defaulted in 1998. I submitted this issue with my payment hitory to the ombudsman and I'm working with her but, she called to tell me today yet another issue. Apparently, there was a forebearance or two on this account and so she thinks that is why the loan is still showing up. Personaly, I think they are making excuses for still reporting this loan and trying to come up with a good reason when there is none. At this point I've been told that the loan reset the SOL to another 7 years in 2002 when I paid it off by the DSL (OC); that after paying the loan it won't delete the TL and that's why its showing (CA) and now this forebearance thing. I just can't get a straight answer from these poeple and probably won't. I requested my payment history and they only sent letters telling me when my loan was originated and that it was paid off. The CA sent a one page doc which covered 3/02 - payoff in 8/02. Does anyone have any knowledge or experience re forebearance and defaulted Student Loans. I guess my question is if you default, and then get a forebearance does that start the SOL all over again? I'm not even sure if I got a forebearance on this loan or not. I'm asking for the forebearance documents. I'm confused.
That happened to me. Way too long ago to remember specifics, but was told it was being reported correctly for just that reason.
From the HEA: So it should be 7 years from default, or if you defaulted after entering a repayment, then it would start over.
Thanks for your help. I explained to the ombudsman, DSL and CA, but the ombudsman is saying that there was a forebearance and that may have restarted the SOL over. Is that possible? Do you have an knowledge as to if a forebearance constitute entering repayment? I looked at the DSL website and it stated that if you were in defalut on you loan you couldn't get a deferment but no such language under forebearance?
If you requested the forebearance, then I suppose it could constitute a new repayment agreement. Hopefully someone more knowledgeable than me will chime in.
I really dont' remember requesting a forebearance and after reading the 1965 higher Education Act, and U.S. Department of Education - Borrower Options and the FCRA, I couldn't find any language regarding a forebearance resetting time for reporting to collections. Their borrower Options site reads that you cant get a forebearance while in default. I defaulted 198 according to law. So Im asking for documentation on the forebearance. The only adverse rule I found was FRCA a footnote to 605a (4) and (5) which reads: The reporting periods have been lengthened for certain adverse information pertaining to U.S. Government insured or guaranteed student loans, or pertaining to national direct student loans. See sections 430A(f) and 463(c)(3) of the Higher Education Act of 1965, 20 U.S.C. 1080a(f) and 20 U.S.C. 1087cc(c)(3), respectively. What is the "certain adverse information" mean? I read the other sections nothing or maybe I'm not understanding it. I will be much appreceiated if you know the answer? Anyone else with this infor as well. thanks.
If you default on any other account, the reporting period is still seven years from the date of first delinquency, unless you bring it current. If you defaulted and started making payments, it might toll the SOL, but the reporting period would remain the same. With a student loan, if you default, enter into a new repayment agreement and default again, they can report from the date of the second default. It effectively restarts the seven year reporting period.
Student loans must be the most inherently unfair account to ever see a credit report. I see more issues with these than anything.
The account officially went into default in 97 according to law (HEA - 270 days without payment) when I wasn't able to pay for about a year. I paid payments sparodically after that date but not enough to bring it out of default. Maybe also got a forebearance at one point. It was sent to the Collection Dept in March 2002 and in August 2002 I finally had the opportunity to pay it off. Both the OC and OC's Collection Dept report to CRAs are using the 2002 date to calculate the 7 years. Is this correct? Is the collection Dept considered a CA. I don't know. If so, can you still send validation if the account is paid? Yes I think you are right. I'm getting screwed because they are using the pay off date or DLA to caluclate the 7 years reorting period. I have to talk to the ombudsman tomorrow and was unsure how to explain to her this situation and make sense of it and use the FCRA and HEA of 1965 to back me up. The OC is claiming the forebearance I got restarted the reporting period, but clearly they are using the 2002 date to calculate the reporting period because its reported to be removed next year 2009. I really should have addressed the issue a long time ago. You are right too Jlynn they are a real nunance. I'm glad college is over for me but, for my kids I'm steering them away from Student Loans. I'll let everyone know if its positive or negative outcome.
So I guess these people are dead set that a forbearance restarts the time for reporting to credit bureaus, despite what the FRCA says. Said I was give "phone forbearance." May not have docs just phone records. Never heard of getting a "phone forbearance." Well, I was able to get my hands on an old CR from 2002 that shows the account was not charged-off and not in collection however it had a history of late pays: Ironically, the report is dated 2/02 and they sent it to default in 3/02. I believe after a call requesting pay-off status. (Selling home and paying bills that year.). Is it ok for OC or CA to not report timely to CRAs and hold your account in limbo out of default status? (i.e. time for reporting for SL based on default). Technically by law was in default, but not being reported as so. Clearly wrong. Here is info from EQ Reported I pulled in 2/02 Reported 12/01 Opened 1996 Reviewed 15 months LDA 3/2000 Payment History: 15 times 90 days + late Previous status: 11/01 15 times late 10/01 15 times late and 9/01 15 times late. Can anyone decipher this old code? I took it to mean that 15 times I was 90 days or more late and in 11/01 15 times 90 days late and so on and so forth. Am I correct?
