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Contributor
Posts: 89
Registered: ‎10-22-2016
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How long does it take for Dept of Education to report paid loan

I paid off an old defaulted student loan on 4/17 and it's still not showing up on my credit report as being paid.  I also never received a paid in full letter.  I called last week and requested one so I could use it to rapid rescore if necessary.  They said they would send one out, so hopefully I'll get it in th next few days. I'm just curious how long it's taken for anyone else for the DEPT of Education to update a defaulted loan to paid

 

Thanks!

 

Frequent Contributor
Posts: 375
Registered: ‎03-13-2017
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Re: How long does it take for Dept of Education to report paid loan

Did you resolve the defaulted loan through consolidation, rehabiliation, or you just paid it outright? 

 

I had two defaulted Perkins loans that I resolved through consolidation. I applied for the consolidation in February, and my old servicer (Great Lakes) were not paid off until April 10th. I had to call and request a default clearance letter as I'm in school and want to be able to use financial aid again. I also need the clearance letter to show my lender that the debt is paid. 

 

I called UAS who had the defaulted accounts and was told that they would report the paid status to the credit bureaus on April 28th. By April 30th, I received the alert on myFICO saying the accounts were paid. 

 

My new servicer, FedLoan, has yet to report the student loans on my credit. So right now if you pull my credit it gives the appearance as if I just paid off $60K worth of debt! 

 

From reading other's stories on here, if you resolved the debt through rehabilitation, sometimes it can take up to 90 days for things to get updated on your credit report. If you want the default clearance letter which shows the account has been paid, call the holder of your loans. It is not Dept of Education, they are only info providers so it depends on them to update that information. 

 

My "default" tag was just removed from my NSDLS and StudentAid accounts this week!

FICO8 Scores - 608TU / 616EQ / 600EX
On Mortgage Journey
Starting Mortgage Scores (Feb 17) 523EQ / 547TU / 564EX
Mortgage Scores (May 17) 595EQ / 625TU / 616 EX
June 17 602EQ / 626TU / 633 EX
Contributor
Posts: 89
Registered: ‎10-22-2016
0

Re: How long does it take for Dept of Education to report paid loan

the loans were paid outright.  No consolidation or rehabilitation, I just wanted them done with.

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Frequent Contributor
Posts: 375
Registered: ‎03-13-2017
0

Re: How long does it take for Dept of Education to report paid loan

Have you tried calling the agency that has your defaulted loans? If you call the Dept of Education they can tell you who that is and give you their number if you don't have it. 

 

When I requested my paid letter, it took 3 business days for them to send it to me. 

FICO8 Scores - 608TU / 616EQ / 600EX
On Mortgage Journey
Starting Mortgage Scores (Feb 17) 523EQ / 547TU / 564EX
Mortgage Scores (May 17) 595EQ / 625TU / 616 EX
June 17 602EQ / 626TU / 633 EX

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