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I have one payment left until my student loan rehab is complete. I've asked Navient a lot of questions about what happens after and they haven't given me any real info. If anyone could answer a few basic questions about it I would be forever thankful.
1. How does this affect my credit report, what changes? Are my old lates and collection comments removed. Is it if I never defaulted in the first place?
2. Who do I pay after? I'm paying Navient $47/month right now. I know my payment may change. Will I get a letter from a different dept letting me know my new payments and due date? Will they contact ,e or do I contact them?
3. How much will this affect my score? I have 9 separate loans showing on my report. All showing defaulted and in collections.
4. Will I be able to refinance once this is complete? I know this varies on score/income/report, etc., but is the option there if I qualify. I'd rather have 1 loan showing opposed to 9.
@Anonymous wrote:
1. How does this affect my credit report, what changes? Are my old lates and collection comments removed. Is it if I never defaulted in the first place? The collection accounts will be removed, and the status on your defaulted tradelines will be updated to remove any mention of the default. Some lenders will delete the old tradelines in full, or remove the lates that led up to the default, but some of them will not.
2. Who do I pay after? I'm paying Navient $47/month right now. I know my payment may change. Will I get a letter from a different dept letting me know my new payments and due date? Will they contact ,e or do I contact them? You will receive a letter from your collection agency when the rehab is completed with the contact information for your new servicer once your loan is picked up. Keep paying the CA until they say the loan has been picked up, and contact them if you have any questions about how to reach your new servicer.
3. How much will this affect my score? I have 9 separate loans showing on my report. All showing defaulted and in collections. That really depends heavily on the rest of your report. You will also see a boost when your new servicer starts reporting your backdated tradelines.
4. Will I be able to refinance once this is complete? I know this varies on score/income/report, etc., but is the option there if I qualify. I'd rather have 1 loan showing opposed to 9. Yes, but you probably don't want or need to. Federal loans generally should not be refinanced to private loans because you lose important protections and options like deferment, forbearance and income-driven repayment plans. Consolidating your federal loans really only makes sense if you have loans with multiple servicers because it won't change your interest rate. Many people have multiple SL tradelines on their reports and strong scores, this is normal.