07-26-2011 09:48 AM
I have student loans from Sallie Mae that I defaulted on several years ago. Since then, I have rehabilitated them, and am currently paying them off through the Income Based Repayment Plan.
I have a letter from NYS HESC, the guarantor of the loans, stating:
"Please be advised, your loan was paid in full through rehabilitation of February 19, 2010. As a result of this sale, NYS HESC has reduced the balance of your defaulted loans to zero. The national credit bureaus have been requested to remove reference of your default status.
Therefore, there is no current record of default as of the above date.
If you are disputing information on your credit report, you may wish to file a consumer dispute with the credit reporting agency."
(bold emphasis theirs)
So I disputed the status of these loans as negative items on my credit report with all three agencies and with Sallie Mae, and the disputes were recently concluded. However, the default status is still listed on all three credit reports. Here is how each of the six accounts has been updated:
Description: Defaulted loan - claim filed against guarantor
Balance paid or being paid by insurance company
|Previously reported||Newly reported|
|Status:||Pays account as agreed||At least 120 days or more than four payments past due|
|Description:||Account transferred or sold||Defaulted loan - claim filed against guarantor|
Balance paid or being paid by insurance company
So I asked that the negative be removed, included a copy of the NY HESC letter, and they actually changed the loans to say they were defaulted even though that's the opposite of what I asked for and the opposite of what the NY HESC letter stated.
Am I missing something? Anyone else had experience with this or any ideas on what to do next? I'm trying to get these negatives removed so that I can qualify more easily for a USDA loan. My mortgage officer said that if I can't get them removed from my credit report, I need to provide a paper trail showing that they have been sold, rehabilitated, and are currently being paid. Which also sounds like a nightmare to try to do. Should I keep working on getting the items updated or just try to get started on the paper trail?
07-26-2011 11:11 AM
I think this post should be moved to the Rebuilding Your Credit forum. You will probably get more replies.
07-26-2011 01:15 PM
07-27-2011 07:40 AM - edited 07-27-2011 11:38 AM
Sallie Mae is not going to change the information, the information look like it is reporting correctly.
I also had a defaulted student loan that was originally with Sallie Mae, I am also working on a mortgage the only difference is I am going conventional. When you completed the rehab program you should have gotten a letter that explains that the loan is no longer in default, if you did not get one or no longer have it contact whoever the loan was rehab with in my case it was the Florida Department of Education, I called to get a letter it was very easy they even offered to fax it, I opted for both.
You can also go to https://www.nslds.ed.gov once you log in it will show your student loans, once you click on the loan it should show that the loan is no longer in default and the date it went back into repayment.
07-27-2011 08:33 AM
Thanks for the replies.
@shaer7, I did get the letter from NY HESC that explains that the loan is no longer in default. That's the letter I quoted above that I sent copies of to Sallie Mae and all three credit bureaus. That's why I'm confused that it's still reporting as in default when the letter clearly states that it shouldn't be.
Thank you so much for the NSLDS link!!! That shows exactly the information that I need for the mortgage underwriters, and does indeed state that the loans have been rehabilitated and are currently being paid.
07-27-2011 11:35 AM
I am happy the link helped.
When the loan is rehab only the information for the guarantor is removed from your credit report. The information from the original lender is not removed. I was just looking at my report and the only one that is report like yours is Equifax, but the information is correct, because the loan did go into default and it was paid by the guarantor.
The information is just stating what happened to the original loan, but it’s not an indicator that the loan is still in default, and you have the information showing it’s not.
Forums posts are not provided or commissioned by FICO. Forums posts have not been reviewed, approved or otherwise endorsed by FICO. It is not FICO's responsibility to ensure all posts and/or questions are answered.Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more
FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.