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I currently have a clean report except for 2 collections for old student loans on EQ. I recently disputed these and they came back as valid, but EQ deleted the payment history. (not sure if that's good or bad) Both accounts show balances, are listed as collections and are shown as closed.
From what I can tell, I have 3 options:
1) Pay them off and ask for a delete and/or a settlement. I am doubtful since it is the Dept. of Edu.
2) Wait and see if they drop off after 7 years and 180 days. The DOFD is 10/2009, so I would have to wait until March of 2017 and see. (I'd prefer to do something sooner than that, sometime arounf October 2016 if possible)
3) Pay them and take my medicine and hope my credit is still good enough to be approved as it is.
I am open to other options. I would LOVE to get these off my report, I am just not sure of my best plan for that to happen. I am also unsure of whether the dispute was a good idea or not. I assume that that has no effect on the drop-off dates or the chance of a settlement with deletion.
Was the student loan guaranteed or insured by the U.S. government?
If so, they are exempted from the normal credit report exclusion period of 7 years plus 180 days that applies to other types of credit.
The Higher Education Act of 1965 provides that there is no exclusion if the loan remains unpaid. It can continue reporting indefinately.
20 U.S.C. §1087cc(c)(3
Honestly, I'm not sure. It was a William D. Ford Direct Loan, so I would believe it is. If that's the case, my best option seems to be to just pay it off and be done with it.
Federally backed SLs are exempt from the practical reporting system. They also do not have a SOL, so paying/settling them would be in your best interest.
@Anonymous wrote:I currently have a clean report except for 2 collections for old student loans on EQ. I recently disputed these and they came back as valid, but EQ deleted the payment history. (not sure if that's good or bad) Both accounts show balances, are listed as collections and are shown as closed.
From what I can tell, I have 3 options:
1) Pay them off and ask for a delete and/or a settlement. I am doubtful since it is the Dept. of Edu.
2) Wait and see if they drop off after 7 years and 180 days. The DOFD is 10/2009, so I would have to wait until March of 2017 and see. (I'd prefer to do something sooner than that, sometime arounf October 2016 if possible)
3) Pay them and take my medicine and hope my credit is still good enough to be approved as it is.
I am open to other options. I would LOVE to get these off my report, I am just not sure of my best plan for that to happen. I am also unsure of whether the dispute was a good idea or not. I assume that that has no effect on the drop-off dates or the chance of a settlement with deletion.
Here's my take - since they are only on one report, I would not really worry about their score effect, because the mortgage lender is going to go by your middle score, and with two clean reports, EQ is going to be the lowest. However, I would get them settled and showing a $0 balance. Mortgage lenders may be spooked by unpaid collections if they are fairly big.