Lates drop off one at a time or in a chunk?

[gamegrrl]

Student loan. 

Notes on Experian credit report read:

• 180 days past due as of Jun 2006
• Last Payment 9/14/2005

Two questions:

• Will the lates drop off one at a time (one a month) or in one chunk 7 years after the late occurred?
• When will the tradeline no longer show on my CRs?

Thanks. I've been reading for hours and days and months and years and this part still confuses me.

[RobertEG]

The FCRA sets a maximum date after which adverse items cannot be included in your credit report.

With respect to monthly delinquencies, each has its own date of 7 years from its individual date of occurence, so legally, each can be separately excluded.

CRAs can choose to exclude at an earlier date.  They could all be excluded at the same time if the CRA chooses to handle them all at once, particularly if close in date.

CR exclusion only applies to adverse items, not to the entire OC account.

Accounts are only deleted upon specific request of the creditor, or in the special situation where the account has been closed for approx ten years, and the CRA then chooses to expunge it from their file.

[gamegrrl]

So in other words, if you had a 90 day late showing, when it got to the 7 year point for the DOFD, that month's late would fall off and the new CR would show you having a 60 day late instead of the 90?

I thought that the DOFD started the 7 year clock, and that as long as you didn't bring the account current again, etc.,  that the negatives would no longer show on the CR.

Also, does it make a difference that this is a closed account?

[MarineVietVet]

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@gamegrrl wrote:

So in other words, if you had a 90 day late showing, when it got to the 7 year point for the DOFD, that month's late would fall off and the new CR would show you having a 60 day late instead of the 90? A 90 day late would likely be preceeded by a 60 and then a 30. Each would drop off at 7 years from it's individual date of delinquency. For example if you had a string of lates such as

30 days late-8/2005,

60 days late-9/2005,

90 days late-10/2005

The 30 day late would drop off this month, the 60 day late next month and the 90 day late in October. 

I thought that the DOFD started the 7 year clock, and that as long as you didn't bring the account current again, etc.,  that the negatives would no longer show on the CR. DoFD  applies to collections and charge offs. They can report for no longer than 7.5 years from the DoFD on the OC account that led to the collection or CO.

Also, does it make a difference that this is a closed account? This makes no difference.

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[gamegrrl]

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@MarineVietVet wrote:

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DoFD  applies to collections and charge offs. They can report for no longer than 7.5 years from the DoFD on the OC account that led to the collection or CO.

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This was an original defaulted student loan, paid by insurance. Is that the same as a charge off?

For the record, this student loan was rehabilitated several years ago, and the new loan has been in perfect shape ever since.

PS - Based upon the drop-off explanation you gave, I will be seeing 180 day lates for months, even though I'll be dropping a month of lates every month. *sigh*

[MarineVietVet]

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@gamegrrl wrote:

This was an original defaulted student loan, paid by insurance. Is that the same as a charge off?

For the record, this student loan was rehabilitated several years ago, and the new loan has been in perfect shape ever since.

PS - Based upon the drop-off explanation you gave, I will be seeing 180 day lates for months, even though I'll be dropping a month of lates every month. *sigh*

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Is this a government backed student loan?

I'm still trying to learn about SL's but I do believe they are handled a bit differently than other collections.

20 U.S.C. § 1080a : US Code - Section 1080A: Reports to credit bureaus and institutions of higher education

A consumer reporting agency may make a report containing information received from the Secretary or a guaranty agency, eligible lender, or subsequent holder regarding the status of a borrower’s defaulted account on a loan guaranteed under this part until—

(1) 7 years from the date on which the Secretary or the agency paid a claim to the holder on the guaranty;

(2) 7 years from the date the Secretary, guaranty agency, eligible lender, or subsequent holder first reported the account to the consumer reporting agency; or

(3) in the case of a borrower who reenters repayment after defaulting on a loan and subsequently goes into default on such loan, 7 years from the date the loan entered default such subsequent time.

I read that to mean that the CRTP for SL's is not the same as other debts and the DoFD might be not as critical. But by no means am I a SL expert.

[gamegrrl]

Yes, this is a government backed student loan. All my student loans were Direct Stafford loans.

This is really great info you posted for me! Thank you!

You know, I looked my loans up online in the National Student Loan Data System. Talk about confusing. So the best I can think of to go by is bullet (1) from your post: 7 years from when the loan guarantee paid the claim.

Looking at my CRs, that would be Date Paid, I guess. In this case, it says 9/01/2005. My thinking is that:

1. At the very least, the negative reporting should cease around September 1 of this year and
2. The tradeline will show as a positive account until ten years from the date it was closed, which was 1/23/2007

Sound logical? Possible?

Just as a point of interest: I phoned the National Student Loan Data System folks to see if they could tell me the date the claim was paid. The person at the other end of the line said, "Oh, we wouldn't have THAT information." Apparently I have to track down the loan guarantee agency and ask them. I say "apparently" because the woman on the phone had no idea who would have that info.