Student Loan Defaults and Collections killing my score!

[Anonymous]

Hello Everyone,

I'm new here.  I've been trying to rebuild my credit for the last couple months.  I had four student loans with Access Group, and when I defaulted on my payment, they all went into collection as 4 accounts  I paid off the collections company and don't owe Access anymore, but now I have 4 accounts that show as having 120 lates, and I have the 4 collecitons.

The 4 Access accounts, that have the 30/60/90/120 lates, then collection are from April 2012.  The collections were paid off in June 2015.

I'm wondering how long those collections will be doing a lot of damage.

Also, on one of the credit reports the collections show as a "charge off" as opposed to settled for less than full value (or whatever you would call it when I reached an agreement to pay-off 1/2 the debt to settle the account).  I'm not sure if the charge off is worse.  

I'm looking forward to participating in this Forum and trying to reach my goal of a 700 FICO

BaronWrangler

FICO - 669

Transunion - 741

Equifax - 655

Experian - 658

[Anonymous]

hey im kinda in the same boat as you but a little deeper Ive had about 60k in student loans dropped and am working on the last staff/unstaff now which are a bit harder after the demon rehab program.  Needless to say Ive learned somethings.

1. It costs the creditors money to change your report from the creditors side so they are not likely to do it without written obligation previous to you paying the debt.

2. Once its paid they no longer care about you and your account so your are more likely to get away with disputes afterwards.

3. I would advise certified letter disputes across the board to all paid creditors using an valid debt challange template and mail with return reciept( i know its expensive) but you get proof back they recieved the letter and the timer starts ticking. why is this important...

"

Here are the basic guidelines for reacting to the results of your dispute request.

1. No response at all. If it's been 30 days after you've sent in your dispute, the credit bureau is in hot water. According to federal credit law spelled out in the Fair Credit Reporting Act (FCRA), a credit bureau is required to respond to you and complete their investigation within 30 days. If they do not respond within the 30-day time frame, they must remove the negative listing disputed. If they do not, they are in violation of the FCRA.
   This is good news for you, for you can pressure the credit bureau to remove the listing immediately. You now need to send them a follow up letter, reminding them of their legal obligations. Here is a sample letter to use and be sure to send it certified or registered and return receipt requested. Again, retain a copy of the letter, as well as the return receipt when you receive it.
2. A rejection based on the grounds that the dispute is "frivolous or irrelevant". If this dispute request is the second, third or even forth dispute for a negative listing, you can't use any dispute that you've used in the past. If you used a duplicate reason, the credit bureau has every right to classify your dispute "frivolous." Re-dispute the listing giving a different reason in this case.
   If you are truly surprised at the "frivolous or irrelevant" designation, you can write them a letter requesting why they have refused to investigate. However, the best and most expedient thing to do would be to re-dispute giving a new dispute reason.
3. Credit bureau thinks a credit repair company submitted the dispute. The credit bureau believes that you are manipulating the system by using a credit repair company, and rejects your dispute. Reject this implication and insist in another dispute, that the credit bureau is shirking their responsibilities and that they are taking a very unwise risk in rejecting your dispute. All you want is for your credit report to be properly corrected.
4. A letter announcing that an investigation has begun. TransUnion will usually send these letters as a clever way of extending their 30-day investigation period. You really have no choice but to accept their timetable. Don't respond to this letter, it will allow them more time to investigate. Just place the letter in the file and watch closely for their response.
5. A letter announcing that your dispute has been forwarded to the appropriate credit bureau. If there is a local credit bureau involved in your dispute, the main credit bureau will forward your dispute to that bureau for verification. Count on an additional two week delay when this occurs.
6. A new credit report showing the results of an investigation. This is the desired result. When you receive your new report, you should copy and carefully analyze the credit report for deletions or changes." - posted from the internet not my writing

4.  you ideally want 1 or 6 in that list.. as they are kinda forced to do something.

Hope that helps I had 60k ish dropped pre 7 year timeline... and am working at post 7 year gov related rehabbed loans now which seem much harder.

[Anonymous]

Thanks for the reply ACM 2015.  I got number 6 on your list; however, the credit bureaus updated the report on these entries, but they look the same to me....they still say "charge off" or settlement for less.  Do these have different impact?  I notice that on some reports they say "charge off" and on some it says paid in full for less than balance.

The same is happening with the collection agency.  I figured they'd not worry about me because I've fully settled with the collection agency and the original creditor, but they are fighting back on my disputes

[takeshi74]

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@Anonymous wrote:

I'm wondering how long those collections will be doing a lot of damage. 

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As long as they're on your reports which is why you need to do whatever it takes to avoid getting derogs and why we recommend addressing them first whenever anyone has any and is looking to improve their credit.  They impact your Payment History which is the biggest factor and tend to be signifcant red flags to creditors.

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

Their effect should taper a bit over time but it's generally better to have no derogs at all versus having any.  Definitely hit the Rebuilding subforum and carefully research before taking action to attempt to address the derogs.  Ideally you want to negotaite for pay for deletes but those aren't relevant if you've already paid/settled.

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@Anonymous wrote:

Im looking forward to participating in this Forum and trying to reach my goal of a 700 FICO

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Keep in mind that you don't have just one FICO.  For one thing, there are many FICO models used by creditors.  Typically for any given model you have a score with each of the 3 major CRA's.