Should I pay off my student loans or just wait until 2012 for it to get off my credit report?

[AgentJackBauer]

I have a $5200 student loan that I have to pay. I would pay it, if I were able to find a real job! I have not found a real job since I graduated in December 2005.

If I don't find a good job soon, should I just wait until 2012 until that $5200 gets off my record, or should I just pay it off slowly? I know that it will help my score if I pay the lowest montly payment $80 something, but 2012 is not that far away. 

What do you guys think?

[Anonymous]

Why is it 2012 out of your records?

[AgentJackBauer]

Doesnt it take 7 years for a collection to get out of your records?

[Cleanmachine]

Check out this Web Site for more information

http://www.ed.gov/offices/OSFAP/DCS/disputes.html

[cobaltnv]

Like Buckyball I am also curious why you think your loan will be removed from your reports in 2012?

Student loans are not like other loans. They are very difficult to have removed without payment. They are also one of the only loans you can rehab back into positive status relatively easy (usually one year of payments or something).

[Lel]

So this student loan is not an account in good standing?  You are delinquent on it?

[nathan]

If you have the ability to pay it, why not just pay it, after all it is a valid debt. 2012 is still a long time from now and this may screw you before that date.

[Anonymous]

If you graduated in Dec 2005 then most loans have a 6 to 9 month grace post graduation before going into repayment, so repayment started summer or fall 2006. So, if you never paid even one payment then the clock would start from them, which would make it 2013.

If you never got a real job as you say, why didn't you claim economic hardship deferment or forbearance? If it's a federal loan they almost never deny it, if it's a priavte they usually will or atleast lower your payments if you requested?

If this is a federal loan your plan to wait for it to go off will not work. The federal government will confiscate any tax return once you find a real job, will garnish your wages if necessary. The fed can take this actions much easier than private lenders and they will.

Btw, if you ever plan to go to school again for anything again  you will have an incredibly hard time. As all applications ask if you have ever defaulted on a loan and a yes is an automatic disqualifier for all federal loans and most private lenders.

[AgentJackBauer]

I have applied for economic hardship serveral times.

I guess I'm going to have to pay it off a month at a time. If I pay it of a month at a time, will the loan agency report to the credit agency's that I'm paying off my loan each month? That way, my credit score goes up.

[Lel]

If this is still considered an account in good standing - no recorded lates  - then paying the minimum required each month will continue to keep it in good standing.  It will be a positive factor for your scores.  Once you have finally paid it off, it will persist on your credit report for another 10 years as a positive factor.  So there's no reason to try to pay it off in one fell swoop.  First, it seems too difficult for you to do at this time.  Second, paying it off now shortens the time that will remain on your credit report.