Posts: 9
Registered: ‎12-21-2010
Re: Student Loan Rehabilitation And The Effect On Tradelines
this might help explain it a bit: keep in mind that the original lender before the default is required to only remove the "default" status. The payment history remains. However I think some confusion comes in when the guarantor (the entity that got the loan and that you are rehabbing with) often will delete their credit reporting. A lot of people think this means the lender will too, but that is not the case. For example: ABC Bank was the lender/servicer. You defaulted so your loan went to ABC Guarantee Agency. You work with them, make your 9 payments and they, ABC Guarantee Agency, tell you they will delete the reporting. That is only for the period of time during which they had your loan. ABC Bank will be notified when you rehab but all they are required to do is change the default status to "transferred" status. There are Metro 2 guidelines for credit reporting specifically for rehabilitated student loans. But even removing a default should improve your score, even if the late payments are still on there. Good luck!