Reply
New Member
Posts: 7
Registered: ‎07-19-2014
0

Almost done repaying a defaulted loan whats best method to repair credit?

I had a private loan with Alaska Student loan. Years ago it defaulted and I had ben repaying a creditor for quite some time. I had found out that if I stopped paying the creditor the loan would then go back to the original lender and they would do wage garnishment and remove the 25% collection fees I had been paying to the creditor. THe garnishment was done without a judgement, in Alaska they just do it.

Since Then I have been paying back the loan as fast as I can, about 10k in the past 3 months as I have been working 80+hr weeks and paying on top of the garnishment. I have another 6k to go before I have it completly paid off which is an amazing realization that I will get out from under this!

My question is this. Now that I am repaying the original lender and am now caught up on payments what is the best way if possible to remove the negative credit remarks and turn them into positive. I have been using lexington law for the past 8 months but I do not know if that is what they do. I realize that lexington may not help in this regard So I ask you what it is that I may also do. I really appreciate the help!

Community Leader<br> Valued Contributor</br>
Community Leader
Valued Contributor
Posts: 1,192
Registered: ‎06-09-2008
0

Re: Almost done repaying a defaulted loan whats best method to repair credit?

One strategy might be a "pay for delete" approach - stop making your extra payments and build up the funds to pay off the debt in one payment.  Then, contact the lender and inform them that you will make a lump sum payment if they agree to improve (or even remove) the negative tradeline.  Since they have already garnished you, there's really nothing more they can do - their motivation to help you may also be limited, but the idea of the lump sum payment may be more appealing than waiting out repayment through the garnishment and hoping you don't lose your job or skip out in the meantime.

 

If that doesn't work, you can send as many goodwill letters as it takes.  The lender does not have to respond, but your efforts to repay the loan will reflect well on your request.  If they choose not to change the reporting though, you'll just have to wait out the 7 year reporting period and focus on building your credit in other areas.

New Member
Posts: 7
Registered: ‎07-19-2014
0

Re: Almost done repaying a defaulted loan whats best method to repair credit?

Thank you for your reply.
I have paid off the entire loan by making one large payment on top if the garnishment.
Even though I have already paid it off is still like to send them the letter asking them to delete the negatives or to have them not contest removal of them.
Can so wine please point me in a direction for what the letter should look like and how to go about it.
Also, any other recommendations.
Now that I paid off the 7 loans my credit dropped about 20 points.
I'd love to see it improve now..
Any help is appreciated.
New Member
Posts: 7
Registered: ‎07-19-2014
0

Re: Almost done repaying a defaulted loan whats best method to repair credit?

Sorry about the horrible spelling. Iphone autocorrected

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions based on Experian or Equifax data (additional FICO® Score versions based on TransUnion data are not currently available on myFICO.com). 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.