Okay, total student loan debt is $125k.
This is in the form of 6 loans, with varying interest rates from 4.2% to 7.6% and the lowest rates are for the loans with the lowest balances (go figure).
I have two old charge offs (settled) for auto loans CapOne Auto that will drop off of my TU report in 5/23; this should give my scores an awesome boost. I have an old 30/60/90 on one CapOne QS card from 8/2020 and a truly mistaken 30 day late on a JPMChase auto loan from May of 2022 where I sold the car and the dealership didn't pay it off in time prior to the late-date.
Currently planning to do goodwill bomb for the JPMChase 30 day late and the 30/60/90. I'm not sure if it will help to also do it for the 2 CO's for Cap One Auto.
All of my CC balances are paid down to <10% and should report as such for this cycle around 10-SEPT.
My scores took a massive hit when I sold my house and my two cars, leaving my only installment accounts being these 6 student loans with 100% balance ratios.
Is there anything else I can do to get my scores up before the pause / forebearance expires in three months?
I did a soft inquiry through LendKey to test consolidation offers and received ZERO offers- not sure if I should have started with a lower dollar figure than $125k so as not to make their algorithm misfire.
Anyway, the ultimate goal will be to refi through NFCU (whom I'm told uses LendKey) as much of the total as possible.
PS- I can knock out 2 of the 6 loans with cash pretty easy leaving 4 total. Would this help? I feel like every time I pay off an installment account I lose 40 points.
Current scores are low to mid 600s. Hopefully the scores will increase as the revolving balances reported go down to <10%.
Silver lining? Cash and cash flow are plentiful. So if you know of a method to help that costs some money, even a moderate to high amount... that's okay. Please tell me.
thanks in advance for your kindness!
Starting Score: 529
I would go more for the dealership being responsible for correcting the 30 day late if possible.
But for the student loan refinancing (this is not consolidation), how's your income? That's the important factor here. If it isn't over $125k and you're not in residency, you're probably not going to be able to refinance the whole amount and might need to do chunks. I certainly wouldn't be refinancing the sub 5% ones at all, you're probably not going to beat that with a private loan right now - a lot of privates are STARTING at 4% and that's excellent credit, high income, low debt.
For the points game, paying off your other loans probably hurt you because you lost open "utilization" on the installments. If these existing loans report separately (mine don't, it's one big balance with Greater Lakes even though its like 14 separate loans), it may help to pay down some of them so it's not all 100%, but I haven't seen a benefit for that unless it gets at least under 89%. But paying down the smaller ones is paying down the lowest rate from what you said and that's not the best mathematically anyway.
But for the student loan refinancing (this is not consolidation), how's your income? That's the important factor here. If it isn't over $125k and you're not in residency, you're probably not going to be able to refinance the whole amount and might need to do chunks. I certainly wouldn't be refinancing the sub 5% ones at all, you're probably not going to beat that with a private loan right now - a lot of privates are STARTING at 4% and that's excellent credit, high income, low debt.
For the points game, paying off your other loans probably hurt you because you lost open "utilization" on the installments. If these existing loans report separately (mine don't, it's one big balance with Greater Lakes even though its like 14 separate loans), it may help to pay down some of them so it's not all 100%, but I haven't seen a benefit for that unless it gets at least under 89%. But paying down the smaller ones is paying down the lowest rate from what you said and that's not the best mathematically anyway.
as of 1/1/23
@ccquest I appreciate the time it took to respond, thank you.
Judging by the dollar amount of the student loans, you would absolutely be right in thinking that I would be in "residency" but I'm closer to being a resident DJ in Las Vegas than any sort of medical professional. haha
My degree is a graduate degree from an Ivy that was just really expensive. As for income, we making many multiples of the total student loan balance, so we are good there. Also, we have no other debt, cars are paid off, etc.
When you mention the dealership, are you advising to note in the goodwill letter to JPMC exactly what occurred or contact the dealership directly? I ask because the dealer is a small one that is thousands of miles from where I live, I don't think legal action will make much financial sense nor do I think they have any power to get the late off of my reports.
Lastly, and sorry to ask... but how is this not consolidation? I, like you, have multiple loans with one servicer (AidVantage) and I was thinking that all could be rolled into one loan for simplicity? They are all at 100% balances and current repayment term is 10 years.
Interest Rate per loan breaks down like this:
Loan 1: $37.4k @ 7.6%
Loan 2: $22k @ 6.6%
Loan 3: $21k @ 6.08%
Loan 4: $34k @ 7.08
Loan 5: $1.8k @ 4.3%
Loan 6: $9.3k @ 5.3%
The rates aren't terrible. The payment for a 10 year repayment period is around $1,400 per month.
Do you think paying off Loans 5 & 6 will help or hurt me in the points game?
Again, appreciate your kindness and expertise.
I owe $130k and make substantially less so no judgement from me, you're clearly doing something right then! And you're substantially ahead of my girlfriend that is in residency, she owes $450k and is definitely not going to be making near that much when she finishes.
I was leaning towards contacting the dealer directly to see if they could resolve as they should have been responsible for making the payoff in time but ultimately your contract with JPMC would have said you are responsible for ensuring it. I'd mention all the details and include whatever proof you have for the transaction date.
It is consolidation in the common sense, but with student loans the general understanding is refinancing for taking the loans private and (hopefully) getting a better rate, consolidation for bringing your federal loans together (ie if they're under separate servicers or if they are different types that may not qualify for IDR plans).
If all the loans are at 100%, paying them off won't really help or hurt at all unless one is substantially older than the rest. If I were to lump sum at all, it'd be on Loan 1 and to get it under 23k. That would put your installment loan utilization overall at under 89% which is where I have (anecdotally) gained points before.
But if you end up refinancing it, that becomes moot again because you're back at 100%! Which is where the image at the top right of my signature comes in...the points help a bit, but do what makes the most sense financially instead.
I was leaning towards contacting the dealer directly to see if they could resolve as they should have been responsible for making the payoff in time but ultimately your contract with JPMC would have said you are responsible for ensuring it. I'd mention all the details and include whatever proof you have for the transaction date.
It is consolidation in the common sense, but with student loans the general understanding is refinancing for taking the loans private and (hopefully) getting a better rate, consolidation for bringing your federal loans together (ie if they're under separate servicers or if they are different types that may not qualify for IDR plans).
If all the loans are at 100%, paying them off won't really help or hurt at all unless one is substantially older than the rest. If I were to lump sum at all, it'd be on Loan 1 and to get it under 23k. That would put your installment loan utilization overall at under 89% which is where I have (anecdotally) gained points before.
But if you end up refinancing it, that becomes moot again because you're back at 100%! Which is where the image at the top right of my signature comes in...the points help a bit, but do what makes the most sense financially instead.
Ah. That's a really smart idea actually to get the loans to 89% across the board to see the point increase.
The loans are actually from 2018-2020 so they are actually aged a bit also. Maybe I'll do the 11% across the board and then focus on paying the highest interest rate one down the most. Does it work like house / mortgage amoritization where if you pay a an extra principle payment on top of the principle and interest payment you can save the interest for that payment? That would be rad and totally worth doing.
I've always contended that Medical School should be absolutely free if someone is smart enough to get in and do good work. If the powers that be want to fix healthcare in the US, they can start by not putting brand new doctors in a half-million dollars in debt from the jump.
Thanks again for the smart ideas. I wish I had your scores, you're crushing it.
I want to say the 89% for me was just aggregate, not necessarily each of them but I can't remember that for certain.
Student loans are simple interest so it'll only accrue on whatever the principal is so yes it should save interest going forward, many of them might show it as paid ahead status but you should be able to call in and change that if you want.
Student loans are simple interest so it'll only accrue on whatever the principal is so yes it should save interest going forward, many of them might show it as paid ahead status but you should be able to call in and change that if you want.
Makes sense, thanks again amigo!