My rehabilitation for by school loan will be done on oct 16th. I was wondering how much did everyone’s score increased after leaving the rehabilitation program and with a loan servicer. My current score is between 675 and 690.
The above poster isn't 100% accurate. The lates have a CHANCE of being removed. If you read through this forum frequently, you will notice that some folks do get the TLs removed & some do not. I did a rehab & I was fortunate enough to have them removed. Others not so much. There doesn't seem to be a rhyme or reason for them being removed.
Hope for the best but plan for the worst.
What is happening is that the current TLs in delinquency get transferred to a new servicer. New servicer = new account. This will happen 100% of the time. It will only occur after you complete the rehab & that transfer takes about 30 days. The new servicer will not report the old account history because, well, it's a new account. That also will happen 100% of the time. The old TLs listed in delinquency will get showed as paid in full. Again, this will happen.
For me, on those TLs, Transunion is the only CRA currently reporting the account. It is only reporting payments up until the DOFD. For me that was 2011. Some people still are showing the delinquency. Some are not. Some have all three CRAs still reporting. This is the grey area. Unfortunately, this grey area has some negative or positive impact in your score.
The big point increase comes from the actual change in reporting. You have X # of accounts reporting delinquency and basically within 45 days you have moved to a positive standing account. So rest assured your score will increase. It's just whether or not the history is removed or not.
I rehabbed 10+ federal student loan tradelines all at once, and I didn't see much of a score change at all after all of those tradelines were closed, and the new servicers picked them up. Most of my previous servicers did not remove my lates. As somebody else in this thread said, it's really a crap-shoot as far as removal of lates goes. Anyway, I was in the mid 500s with all 3 bureaus at the time, and they actually went down a bit at first because of all of the new tradelines. See here: https://www.myfico.com/credit-education/credit-scores/new-credit
My score didn't really change for the better until I did the following:
1) Consolidated all of my new loan tradelines into a federal Direct Loan, and then made several on-time payments on it.
2) Applied for and got approved for a few credit cards, and made severa on-time payments carrying a zero balance the whole time.
In short, it took about 6 months for me to see my score start to really go up after doing those things.
It's a marathon, not a sprint. That's what I figured out the hard way. Also, there is no one-size-fits-all way of discerning how rehab will impact credit scores.