Finally got some resolution here. It appears to be all in who you talk to. After having 4 seperate people at the direct loan servicing center tell me they put in a CR fix and 2 years of BS my score finally got the bump (70 points) I expected when I started this process.
Yesterday I called the DLSS as a last ditch effort and asked to speak to a supervisor. When I got him on the phone I was as polite as possible as I explained the situation here's how the conversation went:
"I was under the impression that after my loan was picked up by a new servicer any record of a default was to be removed within 90 days. Is that correct?"
"yes, that is correct."
"well my loan was picked up 11 months ago and my 9th payment was 18 months ago and my report isn't fixed. Is there anything else you can tell me about when this fix will actually be completed?"
long pause..."I'm gonna have to put you on hold"
"Ok, sir. Thank you for holding. Now that you've got me involved you should get an email from DLSS within 3-5 days saying that your credit file has been updated."
I totally thought this was another brush off and was preparing to start calling lawyers today. I got off the phone with Direct Loans at 4:30pm yesterday and at 8:30am I had an email from my credit monitoring subscription saying my score had changed. Checked my report and the account status was changed from collection account/closed to paid/closed.
Keep on em people, they are legally bound to fix this problem. Don't let them tell you it can't be done. Here's the text of the relevant laws from another thread:
20 USC § 1078–6 (C)
Upon the sale or assignment of the loan, the Secretary, guaranty agency or other holder of the loan shall request any consumer reporting agency to which the Secretary, guaranty agency or holder, as applicable, reported the default of the loan, to remove the record of the default from the borrower’s credit history.
34 CFR § 682.405 (b)(2)
The guaranty agency must report to all national credit bureaus within 90 days of the date the loan was rehabilitated that the loan is no longer in a default status and that the default is to be removed from the borrower's credit history.
the applicable law for FFEL (stafford) loans is 20 USC § 1078–6, found here http://www.law.cornell.edu/uscode/uscode20/usc_sec_20_00001078----006-.html
the applicable regulation for FFEL loans is 34 CFR. § 682.405, found here http://law.justia.com/us/cfr/title34/34-3.1.3.1.40.html#34:3.1.3.1.40.4.40.6
the terms for rehabilitation of perkins loans are essentially the same as stafford
