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Moderator Emeritus
MarineVietVet
Posts: 14,084
Registered: ‎07-14-2009

Re: statute limitation private student loans

[ Edited ]

I also think it's important to remember that these are private SL's. An addendum to FCRA 605 talks about federal SL's:

 

The reporting periods have been lengthened for certain adverse information pertaining to U.S. Government insured or guaranteed student loans, or pertaining to national direct student loans. See sections 430A(f) and 463(c)(3) of the Higher Education Act of 1965, 20 U.S.C. 1080a(f) and 20 U.S.C. 1087cc(c)(3), respectively.

 

 

20 U.S.C. § 1080a : US Code - Section 1080A: Reports to credit bureaus and institutions of higher education:

A consumer reporting agency may make a report containing information received from the Secretary or a guaranty agency, eligible lender, or subsequent holder regarding the status of a borrower’s defaulted account on a loan guaranteed under this part until—

(1) 7 years from the date on which the Secretary or the agency paid a claim to the holder on the guaranty;

(2) 7 years from the date the Secretary, guaranty agency, eligible lender, or subsequent holder first reported the account to the consumer reporting agency; or

(3) in the case of a borrower who reenters repayment after defaulting on a loan and subsequently goes into default on such loan, 7 years from the date the loan entered default such subsequent time.

I read that to mean that the CRTP for federal SL's is not the same as other debts and the DoFD might be not as critical.

 

IMO private SL's are under the same CRTP as other types of CO's/collections. They can report for up to 7.5 years from the DoFD. The DoFD is the most important date needed here.

 

This is just how I see it and I might be wrong.


 

Member
haytertots
Posts: 15
Registered: ‎08-02-2008

Re: statute limitation private student loans

I want to thank everyone for their help with trying to figure this out.  I found this in my research, which seems to clarify things, as well:

 

"Federal law (US Code Title 15, §1681c) controls the behavior of credit reporting agencies. This law is known as the Fair Credit Reporting Act (FCRA). Under FCRA §605 (a) and (b), an account in collection will appear on a consumer’s credit report for 7½ years. The clock starts approximately 180 days after the date of first delinquency on the account. To learn when an account will be removed by the credit reporting agencies (TransUnion, Equifax, and Experian and others), add 7½ years to the date of first delinquency. Subsequent activity, such as resolving the debt, is irrelevant to this rule. The seven-year rule does not apply to all debts, however. Here are four exceptions:

 

  • A tax lien can appear for seven years from the date of payment.
  • A bankruptcy will appear for 10 years from the date of the final order.
  • Federal student loans can be reported for as long as they are delinquent. (Private student loans follow the 7½-year rule.)
  • A civil judgment can appear for seven years, or the length of a judgment’s statute of limitations in the consumer’s state, whichever is longer.

The start of the seven-year begins at the date of first delinquency, or if no payments are made, when the first payment was due. Review your credit report carefully to make certain the dates of first delinquency are reported correctly. Unscrupulous collection agents reset the date of first delinquency to stretch out how long a derogatory account appears on consumer’s credit report. This is illegal under the FCRA."

 

If the above is accurate, then the DOFD on my loan would have been sometime in 2002.  That means that, had the loan been reported originally to my CR, it would have fallen off by 2010.  According to the interpretation above, even though there was "new activity" on the loan, the original DOFD rule still applies.

 

Am I correct?

 

Given all the information, I am leaning toward disputing the reporting with my lender based on wrong DOFD, and requesting that all reporting be removed.  Does anyone know a good approach for this?  I do want to be professional in my approach with them, so I can keep the lines of communication open when I contact them for a settlement down the road (when I have the savings to settle).

 

Thank you again.

Senior Contributor
Walt_K
Posts: 3,065
Registered: ‎11-02-2009

Re: statute limitation private student loans


haytertots wrote:

I want to thank everyone for their help with trying to figure this out.  I found this in my research, which seems to clarify things, as well:

 

"Federal law (US Code Title 15, §1681c) controls the behavior of credit reporting agencies. This law is known as the Fair Credit Reporting Act (FCRA). Under FCRA §605 (a) and (b), an account in collection will appear on a consumer’s credit report for 7½ years. The clock starts approximately 180 days after the date of first delinquency on the account. To learn when an account will be removed by the credit reporting agencies (TransUnion, Equifax, and Experian and others), add 7½ years to the date of first delinquency. Subsequent activity, such as resolving the debt, is irrelevant to this rule. The seven-year rule does not apply to all debts, however. Here are four exceptions:

 

  • A tax lien can appear for seven years from the date of payment.
  • A bankruptcy will appear for 10 years from the date of the final order.
  • Federal student loans can be reported for as long as they are delinquent. (Private student loans follow the 7½-year rule.)
  • A civil judgment can appear for seven years, or the length of a judgment’s statute of limitations in the consumer’s state, whichever is longer.

The start of the seven-year begins at the date of first delinquency, or if no payments are made, when the first payment was due. Review your credit report carefully to make certain the dates of first delinquency are reported correctly. Unscrupulous collection agents reset the date of first delinquency to stretch out how long a derogatory account appears on consumer’s credit report. This is illegal under the FCRA."

 

If the above is accurate, then the DOFD on my loan would have been sometime in 2002.  That means that, had the loan been reported originally to my CR, it would have fallen off by 2010.  According to the interpretation above, even though there was "new activity" on the loan, the original DOFD rule still applies.

 

Am I correct?

 

Given all the information, I am leaning toward disputing the reporting with my lender based on wrong DOFD, and requesting that all reporting be removed.  Does anyone know a good approach for this?  I do want to be professional in my approach with them, so I can keep the lines of communication open when I contact them for a settlement down the road (when I have the savings to settle).

 

Thank you again.


I think you are correct.  You can either dispute the DOFD with the CRAs, in which case they will investigate, and if it is corrected, they should then automatically remove it.  Or, you could do a direct dispute with your lender.  I don't remember the procedures for direct dispute, but if you do a search for "direct dispute" you should find a lot of posts (also by RobertEG) talking about the process.  I also believe he recommends direct disputes over disputes with the CRA.

 

As far as being professional, I think you just handle most of it in writing and state the facts simply.  All you really need is for the lender to report the correct DOFD.  Once that is done, the CRAs should remove the TL on their own.


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Moderator
pizzadude
Posts: 8,775
Registered: ‎01-28-2010

Re: statute limitation private student loans


Walt_K wrote:

I think you are correct.  You can either dispute the DOFD with the CRAs, in which case they will investigate, and if it is corrected, they should then automatically remove it.  Or, you could do a direct dispute with your lender.  I don't remember the procedures for direct dispute, but if you do a search for "direct dispute" you should find a lot of posts (also by RobertEG) talking about the process.  I also believe he recommends direct disputes over disputes with the CRA.

 

As far as being professional, I think you just handle most of it in writing and state the facts simply.  All you really need is for the lender to report the correct DOFD.  Once that is done, the CRAs should remove the TL on their own.


+1.  I would do a direct dispute with the university ( original creditor ) challenging their reporting of a DOFD in 2012.

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Member
haytertots
Posts: 15
Registered: ‎08-02-2008

Re: statute limitation private student loans

Thank you, all, for your advice.  I have researched RobertEG's posts, and (whew!) he has a plethora of information relevant to my case.  I have found a direct dispute letter written by him, which I will use as a jumping point for my own letter to the University.  I will post results to the forum as soon as I hear.

 

Thanks again.

Member
haytertots
Posts: 15
Registered: ‎08-02-2008

Re: statute limitation private student loans

Hi Everyone,

 

I'm in the midst of drafting a direct dispute letter to dispute the reporting of my student loans.  Could I get your opinions on the letter before I send it?  I know it's lengthy, but I do want to be as thorough as possible.

 

Thanks!

 

 

"This letter is to open a dispute of information provided by Cornell University that is reflected on my Equifax, Transunion, and Experian credit files. This is a Notice of Direct Dispute under the provisions of FCRA §623(a)(8)(D) and 16 CFR 660.4, of the accuracy of information you have reported to my credit file. This is a direct dispute of credit reporting. This is not a request for debt validation/verification  under FDCPA §809(b).

 

My credit file reflects 2 negative accounts with Cornell University, which are past the statute of limitations for credit reporting and collections, and must therefore legally be removed from my credit file. 

 

As part of my financial aid package, I obtained private institutional loans through Cornell University in 1997 and 2000. The details of the loans are itemized below:

Acct # XXXXXXXXXX, date opened 10/1997, loan amount $ $7,095

Acct # XXXXXXXXXX, date opened 05/2000, loan amount $ $1,065

 

I graduation and left Cornell in December, 2002. Therefore, repayment was scheduled to begin in June or July 2003. In May 2003, I consolidated all my federal student loans, and had thought these loans were included.  However, since they were private student loans, and not listed with the National Student Loan Data System, they were not included in the consolidation.  I have included a statement of my student loans listed with the NSLDS, and original promissory notes for the loans, indicating the loans in question are not federally subsizied, but are private, and are therefore subject to regular FCRA regulations.

 

I never made a payment on my loans. I never arranged for an extended grace period or continued my education which would trigger an extended grace period. By these actions, my loans with Cornell should have a reported date of first delinquency no later than August 2003.

 

However, both accounts were recently reported to the credit bureaus as a new report, with a date of first delinquency of 3/2012 (see attached EXP, TU, and EFX credit reports from 4/2012).  The date of first delinquency in the new reports is inaccurate. I am disputing the DOFD, and requesting removal from my credit report pursuant to the Fair Credit Reporting Act. Private student loans are governed under the same collection and reporting guidelines, and are subject to the same statute of limitations, as all written contracts.  They are not under the guidelines of federal student loans.  Therefore, the sections of the FCRA outlined below are relevant to my accounts:

 

Fair Credit Reporting Act (FCRA). Under FCRA §605 (a) and (b), an account in collection will appear on a consumer’s credit report for 7½ years. The clock starts approximately 180 days after the date of first delinquency on the account.

 

Furthermore, FCRA 605(a)(4) states 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.

 

FCRA 605(c)(1) states,  “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.”

 

Reporting of these student loans with inaccurate DOFD, which extends the credit reporting beyond the 7.5 year limit, is a direct violation of the FCRA regulations above.  I therefore request that these errors be corrected, which requires removal of these 2 negative accounts within 30 days, pursuant to the FCRA regulations.

 

Thank you for your attention to this matter.

 

Enc:              EXP, TU, RFX credit reports from 4/2012; Original Loan Documentation with Cornell University; Statement of Accounts National Student Loan Data System"

Senior Contributor
Walt_K
Posts: 3,065
Registered: ‎11-02-2009

Re: statute limitation private student loans

I think it looks pretty good.  One comment.  Statute of limitations is not at issue here.  The statute of limitations is a legal defense if they bring a lawsuit.  What you are concerned with is the CRTP (Credit Reporting Time Period). 

 

I said SOL wasn't at issue.  I assume given the time periods involved that SOL for your state has run, but you may want to confirm.  I don't think it would belong in this letter in any event, but the reason you would want to know is so that you know they can't sue you when they see you are disputing this.  I would be surprised if the SOL hasn't run, but some states have long SOLs.


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Current Score: EQ 681 (04/05/13); TU 98 728 (01/06/12), TU 08? 760 (provided by Barclay 1/2/14), TU 04 728 (lender pull 01/12/12); EX 742 (lender pull 01/12/12)
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New Member
jessica-spears
Posts: 9
Registered: ‎10-28-2012

Re: statute limitation private student loans

[ Edited ]

Whatever happened?  Can a mod e-mail/message haytertots to see about a possible update please!

Member
IndianaJane
Posts: 14
Registered: ‎10-14-2012

Re: statute limitation private student loans

I hope you got a good result. As a former attorney, I would've advised against sending that letter. I would disputed directly with the credit agencies as the debts are too old by law to be included on your credit report. Your first delinquency set the clock running, whenever their charge off date was. The charge off was likely because they realized they'd missed their window to sue on the debt. It has nothing to do with the clock for credit reports. If they timed it on thatthis can be removed directly by objection to the credit agency. 


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