AES rehabilitation program

[darxan3]

Has anyone had their defaulted student loans rehabilitated by AES rehabilitation department?  My husband and I had consolidated our loans years ago, and during some financial hardships our loans fell into default.  We enrolled in AES' rehabilitation program.  We finished with it over 3 months ago.  I understand that they will not remove the late payments, but that they were suppose to remove the default status.

I am confused about how default is listed on a credit report.  I don't know what it looks like - does it say "Loan is in default"????

On our credit reports the loans are listed twice - once in good standing with no lates, and also in the negative section with status as "Claim filed with government", and "Student loan permanently assigned to government."  I am not sure if this listing still means in default or if it just is showing our bad payment history.

We called the AES rehab. department and they said that this is not listed in default - that it will be listed in the negative area in this way because they can't remove the late payments.  It just makes me nervous because they weren't looking at our credit report when speaking to us. 

I can live with the negative marks, but my concern is that it is still listed as in default.  My husband and I are applying for an FHA mortgage loan in the next month and a half and I know you do not qualify for FHA if you have defaulted on any federal student loans.  I just wanted to know if anyone else had this experience - how is default noted on a credit report? 

I was planning on disputing the loans to make sure they are updated as not in default - like I said I don't care that the negative mark has to stay, I just don't want to be disqualified for an FHA mortgage...any ideas???

[Anonymous]

Here is what they told my boyfriend. Currently the original loans are reporting in default and also say that they are being paid by government or whatever terminology they use.  They are also reported again as a being in collections in the revolving part of his credit report. Every month they are marked late and it is tanking his scores. He is 7 months into his 9 month rehab now and they claim that after the loan has been rehabbed it will be sent back/purchased back by either original lender or another lender for him to continue making payments on until it is paid off.  They claim they will remove the entire tradelines of the collection accounts being marked late each month, but that the lates from the original student loan (reporting as Sallie Mae) will stay on his reports. It sounds as if you and I are on the same page and they made the same promise to you, but aren't keeping it. We made sure to ask numerous times if the collection tradeline would be removed or just marked paid, and they assured us it would be removed in it's entirety, and that the only one that would stay is the original defaulted Sallie Mae tradeline.

I hope you can get yours fixed.