help?advice? just starting~

[Anonymous]

So 4 months ago I realized I could not ignore my finances anymore and was tired of apartment living, not to mention I owe it to my wife.  I probably should have read these forums prior, however I pulled a credit report and started paying off anything that was on it that was a collection (3 in total under $1000) total(not knowing they would still stay on report just said paid)  I still have one account with a collection from a stafford loan from college, however I have been on a payment plan with them for 2yrs without being a day late (they claimed that after 12 months the account would be transferred out of collections but blame last winters credit crunch for a lack of lenders to sell off to.  I just pulled my scores today, and here are some ME/and wife stats, loan people out there, do we have a chance now? advice?

Scores:

Me- Tu 642 Eq 636 Ex 593

Wife- all in 730-750 range last time pulled

Income:

Me- 65K

Wife- 15K (worked limited PT last yr as welcomed our daughter into the world, when FT 45k)

Current Debt:

-auto loan-350 per month

-student loan- 500 between both of us

-no cc debt card is paid in full

-We have about 12K for a down payment and are looking in the 130-140k range for houses

any help or experiences relating would be helpful as I try to get my family into a home!

[Anonymous]

Better check on that student loan, something is fishy there.  Rehab takes just 9 months of on-time payments (not 2+ years!) and there are plenty of lenders that pick these up - the ecomony is not an excuse.  Sounds more like they just want to milk you for more high-interest payments.  Once your loan is rehab'd you get a great rate and all late pays/negs removed.

[Anonymous]

thanks for the advice... how could I go about forcing the issue of them transferring it as everytime I call they just say to schedule a few more auto-payments (I now have done that 3 times for 4 payments each time) and that it could be any day and they will notfiy me... I agree that it sounds fishy, but seem almost stuck based on what they are telling me...

[Anonymous]

Well you should have done a SIGNED rehab agreement with the CA in the first place.  Do you remember signing anything?

[Anonymous]

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@Anonymous wrote:
Better check on that student loan, something is fishy there.  Rehab takes just 9 months of on-time payments (not 2+ years!) and there are plenty of lenders that pick these up - the ecomony is not an excuse.  Sounds more like they just want to milk you for more high-interest payments.  Once your loan is rehab'd you get a great rate and all late pays/negs removed.

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That depends on several factors. Who the guarantor is (Texas Guaranty is not currently rehabbing loans due to a lack of lenders) is just one piece of the puzzle.

But it is true that fewer and fewer lenders are picking up SLs. Just ask over in the Student Loans forum here. Or do a search on the internet. There's plenty (and I mean *plenty*) of people in the OP's situation. Just because you found a lender to subrogate your loan doesn't mean everyone will. :/

Think of it this way: you think that the foreclosure crisis is bad? Student loans have a higher (much, much, much) higher default rate. And as credit tightens and incomes drop, more people are defaulting on their SLs (it's usually the first debt to "go" ). It's no wonder that because of the economy fewer lenders are willing to pick up these loans.

Especially since the borrowers for rehab loans defaulted in the first place. Not a condemnation at all, just common sense. :/

[Anonymous]

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@Anonymous wrote:
Well you should have done a SIGNED rehab agreement with the CA in the first place.  Do you remember signing anything?

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You don't get the signed rehab agreement from the CA. The CA is, under the confines of it's contract with the guarantor, not allowed to enter into any new contracts or change the verbiage of the original contract.

What you *would* get is something along the lines of an agreement from the guarantor. But never from the CA. If you *did* get something from the CA, I can guarantee you it ain't worth the paper it's written on. The guarantor calls ALL the shots.

For the most part, rehabbing is more like a .... leap of faith.

[Anonymous]

OP: I'd post a thread about your SL situation over in the Student Loans forums.

However, I do believe (99%) that if you can demonstrate that you've made 2 yrs worth of on time payments on the loan, that it should be okay. I could be wrong though. I believe that Stafford loans are Fed backed and if they're in the CAIVRS system (which, if they were defaulted on and are Fed, they would be), that might be a problem.

How much left do you owe? Who's the guarantor? Post about it in the Student Loans forum with the who's and what's ... someone might have contact info for you to help you get this resolved!