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Valued Contributor
IOBA
Posts: 2,697
Registered: ‎08-13-2009
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Re: statute limitation private student loans

haytertots - I know it hurts right now, but no, I don't think it's reaging.   I think that they reported the first date of default is wrong, but the first report of major delinquency is correct since the "major delinquency" is considered the charge off.

 

The CR can not show the last 10 yrs of missed payments, BUT it can show the last 7.5 yrs of missed payments.   It looks like the school is not going to add that to your report, which is a blessing.

 

The charge off is a NEW event - which the school has every right to report to the CB.    The NEW event can report up to 7.5 yrs.

 

The school CAN come after you for the money and so can a CA.   Just because the debt is old, and maybe past the SOL, does not change the fact you borrowed the money and did not pay it back.

 

The SOL is used for taking legal action, not releasing you from the debt/obligation to pay.

 

Do you have any money you can give to the school?    

 

My suggestion would be to call the school and talk to them.  Be polite and courteous, no matter how the conversation goes.  Nicely explain that you thought the loan had been consildated with your other student loans.   You are surprised to find out it wasn't, but would like to make things right.   Offer the school a choice - settle for x amount (whatever you can come up with - maybe 50%) or monthly payments of xx to pay it off within the next two -five years.

 

If you can settle with them, ask for a deletion of the tradeline.

Senior Contributor
Walt_K
Posts: 3,065
Registered: ‎11-02-2009
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Re: statute limitation private student loans


IOBA wrote:

haytertots - I know it hurts right now, but no, I don't think it's reaging.   I think that they reported the first date of default is wrong, but the first report of major delinquency is correct since the "major delinquency" is considered the charge off.

 

The CR can not show the last 10 yrs of missed payments, BUT it can show the last 7.5 yrs of missed payments.   It looks like the school is not going to add that to your report, which is a blessing.

 

The charge off is a NEW event - which the school has every right to report to the CB.    The NEW event can report up to 7.5 yrs.

 


Are you sure about this part?  I thought it came off based on DOFD.


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Valued Contributor
IOBA
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Re: statute limitation private student loans

Walt_K - all baddies can stay on up to 7.5 yrs from the date that they occured.  

 

Her charge off occurred 03/2012 or 04/2012.   The charge off would be a NEW event and that can stay on her report for up to 7.5 yrs.

 

Most companies will allow about 6 months of no payments before they do the charge off.   It's usual for a company to wait ten years to do a charge off.  But yes, they can report the charge off that just occurred becuase it just happened.    

 

The school can NOT go back and report the lates dating 10 years ago.   The max that they can report backwards is 7 yrs for each late.   So they could create a history for the OP that dates back to 03/2002 and say she's had lates every month since then.   Which, technically, she has.   Then in 04/2012 the late of 03/2002 should be gone.  In 05/2012 the late from 04/2002 should be gone.   In 06/2012 the late from 05/2002 should be gone.   The status of charge off would stay on the report for up to 7.5 yrs.

 

I hope this makes sense.

 

I think the OP's best course of action is to call the school and work something out with them for repayment and for deletion of the tradeline.   With the loans being that old, the school would probably work with her.

Valued Contributor
IOBA
Posts: 2,697
Registered: ‎08-13-2009
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Re: statute limitation private student loans

Walt_K - PS - the school can NOT report the OP as being late anymore.   As of the date of the charge off, her balance would report as zero.

 

A CA may come along and start reporting the collection with a balance (loan plus collection fees, plus interest).   The CA would be going from the date of the last action - which was the charge off - and can report (I believe) for up to 7.5 yrs from date of charge off.

 

I don't know how the SOL would apply to a private student loan, but based on what others have shared, it appears the SOL is past so the CA can't take her to court.

 

This may be one for the Mighty Moderators to chime in.  :smileyhappy:   It's definitely tricky with the charge off just happening.

 

Hopefully the OP can take care of the account before anything else happens.

Senior Contributor
Walt_K
Posts: 3,065
Registered: ‎11-02-2009
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Re: statute limitation private student loans

[ Edited ]

IOBA wrote:

Walt_K - all baddies can stay on up to 7.5 yrs from the date that they occured.  

 

Her charge off occurred 03/2012 or 04/2012.   The charge off would be a NEW event and that can stay on her report for up to 7.5 yrs.

 

Most companies will allow about 6 months of no payments before they do the charge off.   It's usual for a company to wait ten years to do a charge off.  But yes, they can report the charge off that just occurred becuase it just happened.    

 

The school can NOT go back and report the lates dating 10 years ago.   The max that they can report backwards is 7 yrs for each late.   So they could create a history for the OP that dates back to 03/2002 and say she's had lates every month since then.   Which, technically, she has.   Then in 04/2012 the late of 03/2002 should be gone.  In 05/2012 the late from 04/2002 should be gone.   In 06/2012 the late from 05/2002 should be gone.   The status of charge off would stay on the report for up to 7.5 yrs.

 

I hope this makes sense.

 

I think the OP's best course of action is to call the school and work something out with them for repayment and for deletion of the tradeline.   With the loans being that old, the school would probably work with her.



I'm not an expert in this.  RobertEG's posts would be good to search.  But I don't think this is correct. 

 

I'm looking at FCRA 605(c)(1).  The 7-year period referred to in paragraphs (4) and (6) of subsection (a) [note, paragraph (4) is for collections and charge-offs], shall begin, with respect to any delinquent account that is placed for collection (internally or by referral to a third party, whichever is earlier), charged to profit and loss, or subjected to any similar action, upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency which immediately preceded the collection activity, charge to profit and loss, or similar action.

 

I read this as saying that you count from the date of first delinquency that preceded the charge off.  It doesn't say you count from the date the charge off was placed.

 

ETA:  I believe this is also the reason you can't put an old collection on the report.  You could say that placing the account with a new collection agency is a new event that can be reported for 7.5 years.  I'm pretty sure it doesn't work that way.  You go from the DOFD. 

 


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haytertots
Posts: 15
Registered: ‎08-02-2008
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Re: statute limitation private student loans

IOBA wrote:

haytertots - I know it hurts right now, but no, I don't think it's reaging.   I think that they reported the first date of default is wrong, but the first report of major delinquency is correct since the "major delinquency" is considered the charge off.

 

The CR can not show the last 10 yrs of missed payments, BUT it can show the last 7.5 yrs of missed payments.   It looks like the school is not going to add that to your report, which is a blessing.

 

The charge off is a NEW event - which the school has every right to report to the CB.    The NEW event can report up to 7.5 yrs.

 


So, if this is true, you are saying that as long as a creditor keeps a file open on their books, they can incur a "new event" anytime they want, and then report this to the credit bureaus?  Please correct me if I am wrong, but this seems in contrast to what was recently quoted from the Fair Debt Collection Act.  I thought that the DOFD was used to prevent this, so that debtors can recover from past mistakes in a timely manner, rather than their debts chasing them for the rest of their lives.  From what I've read, new activity that can reset the 7.5 year reporting limits have to be initiated from the borrower, in the form of a payment arrangement, etc.  In my case, since I didn't know the loan existed, I have made no such payments or arrangements.  Also in my case, the creditor waited until there was 10 years of delinquent history to write the loan off and report it as new activity.  This means that by the time this finally falls off my credit report, it will be nearly an 18 year-old debt. This doesn't ring true to me.

 

In your opinions, should I contact the OC & attempt a settlement, or should I seek the advice of an attorney as to the legal grounds for disputing the debt?

 

Thanks again for all your advice.  I'm not sure if I know with certainty where I stand, but your advice is very helpful.  It seems mine is definitely an odd predicament. 

Valued Contributor
IOBA
Posts: 2,697
Registered: ‎08-13-2009
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Re: statute limitation private student loans

Walt_K - the wording is open to intepretation, I know.   Maybe one of the Mighty Moderators will pipe in.  

 

With the wording you provided, to me, it sounds like the change was the change in profit/loss, and can be reported.

 

haytertots - IMO, yes, contact the school and work out a payment plan.  Regardless what you thought happened 10 yrs ago, the school kept the loan on their books.  You definitely want to resolve things with them instead of a CA.

 

IMO, they can report the charge off for up to 7.5 yrs (for this, since there is no reporting history behind it, I think it's 7 yrs).   This is a new scenario that I don't remember reading about before.   It's my understanding that they can report, but I could be wrong.   

 

Whether I am right or wrong, the debt exists and they can try to collect forever.   The best bet is to contact the school, ask them to remove it from your CR, and pay them directly.   


Moderator
pizzadude
Posts: 9,674
Registered: ‎01-28-2010
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Re: statute limitation private student loans

 

I think the first thing that has to be straightened out is the DOFD.    If the DOFD is really back in 2002 then any collections that come up would be past CRTP and should not show.   The CRTP for collections is always based on the DOFD of the original account ~ not the charge~off date or the date assigned.

 

I agree that the question of the original account reporting is very confusing ~ I would also assume that it would also be past CRTP if the DOFD was changed to 2002, since it would long since be past 7.5 years.    

 

I think the OP's best approach is to dispute the DOFD with the original creditor.     I'll also ask one of the mods to give us their option as well.

 

 

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Senior Contributor
Walt_K
Posts: 3,065
Registered: ‎11-02-2009
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Re: statute limitation private student loans


pizzadude wrote:

 

I think the first thing that has to be straightened out is the DOFD.    If the DOFD is really back in 2002 then any collections that come up would be past CRTP and should not show.   The CRTP for collections is always based on the DOFD of the original account ~ not the charge~off date or the date assigned.

 

I agree that the question of the original account reporting is very confusing ~ I would also assume that it would also be past CRTP if the DOFD was changed to 2002, since it would long since be past 7.5 years.    

 

I think the OP's best approach is to dispute the DOFD with the original creditor.     I'll also ask one of the mods to give us their option as well.

 

 


+1

 

I also come out on the side that if DOFD is corrected, this should be taken off.  FCRA 605(a)(4) says that accounts charged to profit and loss which antedate the report by more than seven years must be excluded.  FCRA 605(c) says you count those seven years from the expiration of the 180 day period beginning with the commencement of the delinquency which preceded the charge off. 

 

Based on this, it doesn't matter that the charge off is a new event.  You still have to look at how you measure the 7 years for that new event, and you do that by looking at the DOFD. 

 

While waiting for a mod, I would also suggest that OP run some searches for RobertEG and DOFD.


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Moderator
pizzadude
Posts: 9,674
Registered: ‎01-28-2010
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Re: statute limitation private student loans

 

One of our Mods, Lightnin, found this post:   http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Charge-Offs-fall-off-when/m-p/1362841#M183284

 

I'm would think that it applies to student loans as well.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX

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