03-15-2013 09:09 PM
I just ran a credit report to see what I can do to bring my score up. I have a few student loans on there that were just closed last month. It doesn't say why, it just says the status is closed. I didn't think student loans closed? I thought they stayed open forever?
Now that they're closed (and they're not fully paid off because I haven't had the money to make payments on them) what does this mean and are they still going to be collecting on this - garnishments, etc.?
03-16-2013 10:15 AM - edited 03-16-2013 10:20 AM
Loans are 'closed' when they are paid off. These loans were open with balance due? These accounts are now closed and show a $0 balance due, right? If you had a balance on these loans and they are suddenly showing closed, chances are these loans have been bought by another lender and transferred to a new loan servicing agent. You will have new loan tradelines appear on your reports within a few months. You will send payments to the new servicer. I would call up the original servicer listed on the old closed loans and ask them where these loans were transferred to. You want to confirm the address they had on file for you since this is where your new servicer is trying to contact you at.
Edit: You make it sound like you have been not paying and have defaulted. If this is true and they have begun garnishment then these loans may be been transferred back to the governement and are assigend to a collection agency or some other holder while collection activites occur.
03-17-2013 01:34 PM
Student loans only stick around forever if you don't pay them off. Like bahabhd said, it sounds like these loans have been transferred to another agency, either a new servicer, or (if they have defaulted) a collection agency. If they are in default, the collection agency can garnish your wages and seize your tax returns to help pay the debt.
If you don't want to contact the original lender, you could also check the National Student Loan Data System (nslds.ed.gov). That will tell you who holds your loans and their current status. It is also a complete list of all of your student loans, so you can make sure that you haven't missed any as you start to repair your credit.