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How long will Stafford student loans hurt my credit score?

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Anonymous
Not applicable

How long will Stafford student loans hurt my credit score?

I'm new to the forums so my apologies if this was answered elsewhere. I've spent the last years or so trying to repair my credit and am wondering how long will Stafford student loans stay on my report? I graduated in 2011 and most of these loans were from 2008-2009 but still seem to appear on the report. Will these ever go away? I have not paid these at all but am afraid to start paying them at this point because I don't want the ~7 year clock to reset on this. Many of them appear as BoA/AES and USAFUNDS on my report. 

 

My friend has been helping me with other aspects of my report (I had never monitored my credit score before) but he told me to come here to ask about student loans as they are completely different and something he knows little about. Would really appreciate if I could get some solid advice on what my best plan of action is here. If I need to provide more info I will gladly do so. I've gotten my credit score up from a 550 to around a 640 but it's sort of stalled there for the time being.

 

Not sure how relevant this is but the loans show up as 10-15 different small loans instead of 1 loan on my credit report so there are a lot of missed payments showing up. 

 

Thanks in advance for your help 

Message 1 of 8
7 REPLIES 7
RobertEG
Legendary Contributor

Re: How long will Stafford student loans hurt my credit score?

If the student loans are federal, they are exempt from the normal 7 year exclusion periods, have no SOL protection, and mandate continued reporting of delinquencies if the loan remains unpaid.

Message 2 of 8
Anonymous
Not applicable

Re: How long will Stafford student loans hurt my credit score?

I have never tried rehabbing these loans. If I do so is there any risk of my score decreasing? I've worked hard the last year or so to get my score up around 100 points I don't want to do anything to potentially harm it

Message 3 of 8
RobertEG
Legendary Contributor

Re: How long will Stafford student loans hurt my credit score?

If federal student loans are still delinquent, there is no 7 year exclusion period to reset.

They are exempt under provisions of the Higher Education Act from the normal exclusion periods set in the FCRA.

They may also result in civil action, charge-off, or referral for collection, adding additional derogs to your credit report.

 

Credit report exclusion wont be required until the loan is repaid.  At that point, delinquencies from back in 2008-2009 would become excluded.

 

 

Message 4 of 8
Anonymous
Not applicable

Re: How long will Stafford student loans hurt my credit score?

So what is my best approach to not only get these paid but to try to get my credit score up as well? I assume Stafford Loans are federal? I don't know much about this stuff which is why I came here looking for some advice 

Message 5 of 8
RobertEG
Legendary Contributor

Re: How long will Stafford student loans hurt my credit score?

Yes, Stafford student loans are federal.

My suggestion would be to consider repayment.  The derogs are apparently of an age such that, once the loan is paid, they will become excluded.

Message 6 of 8
Anonymous
Not applicable

Re: How long will Stafford student loans hurt my credit score?

When you say paid are you referring to it being rehabilitated or paid in full? I am certainly unable to pay the loans in full 

Message 7 of 8
RobertEG
Legendary Contributor

Re: How long will Stafford student loans hurt my credit score?

Since the drogs that might be affected by payment are older than 7 years, I dont see that rehab has any significant advantage as to obtaining their exclusion.

Paid will result in exclusion without resort to removal based on rehab.

 

Settled for less, should they accept, is a legally paid loan.

 

I would recommend calling the creditor and discussing their offered terms.

Message 8 of 8
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