Private loan, SOL, co-signer....help!

[laurie123]

I have a very complicated situation that I am hoping someone can help answer questions to.

Private student loan taken out in 1999. Placed on and off I to deferment since with occasional periods of payment being made and a few late marks from about 8 years ago. Fast forward to this week....this loan company didn't receive the in school deferment(in school again completing masters in nursing) and sent it to collections. This loan has a consigner who was receiving the communication and I have been paperless. Not saying it's not my fault but I wasn't neglecting it on purpose. The loans usually obtain info on their own from clearinghouse.

So, this is not on my credit report and hasn't been in years. Will the collection agency start reporting this old loan? And bc I had a few late payments 8 years ago, does that count as the DOFD? Making this too old to report? I'm not sure if my co-signer has this loan on her report as there is a loooong not good history there but it fell off my report a few years ago.

And I do plan on making payments but will not be paying a lump sum. I just want to have an idea of what I am dealing with before I call the CA.

Thanks in advance!

[jd352]

It will very likely show up on your report (and cosigners) as a collection account. Collection agencies use your credit as leverage to get you to pay them since a bad account hurts your ability to apply for credit. DOFD would have only counted if you havn't paid the loan since those lates if you were trying to see if the loan was beyond the SOL's for your state.

It a bit surprising that the lender stopped reporting on the loan as it was still current at the time.

Have you tried to see if the lender can "get the loan back" from the collection agency? Try seeing if you can arrange something with the lender and not the collection agency.  

[laurie123]

I am most definitely going to try to deal with the original loan company first as this has been a long standing account with a pretty positive history. I'm not sure why it's not on my report anymore.

When I was reading on here it was mentioned that stated in the fair credit report act was something along the lines of SOL occurring whether or not the account was brought current after a late payment. I'm confused. It would seem unfair if a collection agency was able to start re-reporting an old account that has already fallen off. Maybe it was just not on my credit report though: I'm not sure.

I am going to try first to call my lender and then negotiate with CA

Thank you for your help.

[laurie123]

I meant DOFD not SOL. I read that the date of first delinquency remains the same whether it not you bring the account current.

[SCF]

The DOFD is only relevant for defaulted accounts - and it is the date when the account first fell behind and was never brought current again before being placed in default status.  So, if you were late 8 years ago, brough the loan current, and then went late again last year which lead to the default, your DOFD would be last year.  Usually, when an account goes into default, it's charged off or transferred to a collection agency, so that tradeline closes and falls off your report entirely 7.5 years from the DOFD.  

If you just go late and the loan never defaults, those individual lates remain for 7.5 years, and the loan itself, if it closes in good status, will remain about 10 years (so you can wind up with a window where those lates are gone, but the original tradeline is still there and now completely positive).

I'm not sure why the original lender stopped reporting this loan if it was actively being paid or in deferrment the whole time.  From what you've said, it sounds like the collection agency will be able to report it on your credit - this loan is likely still within the statute of limitations because you've made payments and/or kept the loan current through deferment until recently.  Also, it sounds like your DOFD would be whenever the loan went late after your in-school deferment should have started but did not.  They can (but may not) also report all of this on your co-signer's report.

I would also suggest contacting the original lender.  In light of the fact that you were in school and the loan normally updated with that status on its own before, you may be able to argue for a retroactive deferment to bring the loan current and remove the lates.