Delinquency

[Anonymous]

I received financial aid from the Department of Education while I was in school and there was a financial aid overpayment that I was unaware of until I received a letter from them stating that I had an overpayment of $700. I set up a payment plan to pay them within a certain amount of months and they said the account would be closed after the final payment was made. My payment agreement was from January 2015 to May 2015 and all of these payments were made on time on the designated dates that they were due. No further action was needed. Several months later I checked my credit report only to find that it was showing a delinquency for that same account with the Dept of Ed and the delinquency was showing for months after the last payment was made. Is there a way that I can get this delinquency off of my credit report because it is negatively affecting my score! I have all receipts showing that all payments were made at the designated time in the account was closed and paid in full.

Please help, I am trying to purchase a home soon and I do not want this to hinder that process.

[RobertEG]

The effective date of the delinquency should be reported as the date the overpayment was made, not the date you rectified the matter.

Under the Higher Education Act, the normal 7 year exclusion period for delinquencies does not apply while the debt remains unpaid,but since you have now paid it, then the exlcusion should occur no later than 7 years from the date of the delinquency.

[Anonymous]

Okay so my question is shouldn't that delinquency be removed if I was never late on any payments? The overpayment itself was not on my credit report when I received the notice it wasn't until AFTER i had finished paying that they reported it as late. Is that legal?

[RobertEG]

It is proper for a creditor to report a late at any time, provided it was accurate.

However, in your situation, the issue is not the lateness of the reporting of a prior delinquency, but rather the fact that they can legitimately report any late.

In that regard, I would agree with you.

In order to report, for example, a 30-day late, they would have to have set a billing due date upon which to determine and report beng 30 days past that date.

They apparently never sent a bill with a due date that you failed to pay within the set time?

If that is the case, I would dispute having a reportable delinquency under the guidelines set forth in the CRA credit reporting manual.