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Nelnet late payment reporting

Regular Contributor

Nelnet late payment reporting

Hello, 

I have 8 student loans and in April 2017 Nelnet reported a 90 day late with no preceding lates. The payments were late  but shouldnt they show progressive late payments, like one 30 day late and a 60 day late and so on. I don't know what to do. On one hand I want to challenge the reporting because it's a 90 day but on the other hand I want to leave it alone because the number of derogs will increase. Should I challenge this or just leave it alone?


Gardening until 6/6/2018
Message 1 of 6
5 REPLIES
Community Leader
Legendary Contributor

Re: Nelnet late payment reporting

It has become rather standard practice for creditors not to report each and every monthly delinquency.

Some will cut the consumer a break by delaying reporting of monthly lates until they reach a threshold amount of, for example, 60-late or 90-late.

Some will defer reporting of monthly delinquencies, period, and only report delinquency once they have charged-off the debt.

Thus, the first reporting may be CO.

 

The FCRA does not mandate that a creditor report each level of delinquency, it requires only that what is reported cannot knowingly be inaccurate.  While one could dispute the lack of showing of lower levels of delinquency on the basis that the reporting is incomplete, consumers rarely if ever dispute to have derogs added, and thus furnisher past practice of not reporting each and every lower level of delinquency has become standard practice, with no case-law being established by consumer civil actions contesting such practice.

When a statute does not mandate something, and thus is subject to interpretation, existing and long-established practice with no case law precedent to the contrary is given strong deference as acceptable interpretation.

You can, of course, dispute the lack of reporting of all levels of delinquency as being "incomplete reporting," but I would not recommend that as a prudent step.

 

More important is the date of the initial account delinquency, as that is the date that ultimately determines when a chain of account delinquencies becomes excluded.  The CRAs exlcude all delinquencies in a chain based on 7 years from the date of the first delinquency in the chain.   A reported late in 4/2017 of 90-days is treated by the CRA as having a presumed initial delinquency of 1/2017, adn thus an ultimate exclusion date of no later than 1/2024.  Specific reporting of the initial delinquency of 1/2017 will not affect that exclusion determination.

 

I would leave it be.  It is common and acceptable practice, and is not effecting the current level of reported delinquency, or the ultimate exclusion date.

Message 2 of 6
Regular Contributor

Re: Nelnet late payment reporting

 


@RobertEGwrote:

It has become rather standard practice for creditors not to report each and every monthly delinquency.

Some will cut the consumer a break by delaying reporting of monthly lates until they reach a threshold amount of, for example, 60-late or 90-late.

Some will defer reporting of monthly delinquencies, period, and only report delinquency once they have charged-off the debt.

Thus, the first reporting may be CO.

 

The FCRA does not mandate that a creditor report each level of delinquency, it requires only that what is reported cannot knowingly be inaccurate.  While one could dispute the lack of showing of lower levels of delinquency on the basis that the reporting is incomplete, consumers rarely if ever dispute to have derogs added, and thus furnisher past practice of not reporting each and every lower level of delinquency has become standard practice, with no case-law being established by consumer civil actions contesting such practice.

When a statute does not mandate something, and thus is subject to interpretation, existing and long-established practice with no case law precedent to the contrary is given strong deference as acceptable interpretation.

You can, of course, dispute the lack of reporting of all levels of delinquency as being "incomplete reporting," but I would not recommend that as a prudent step.

 

More important is the date of the initial account delinquency, as that is the date that ultimately determines when a chain of account delinquencies becomes excluded.  The CRAs exlcude all delinquencies in a chain based on 7 years from the date of the first delinquency in the chain.   A reported late in 4/2017 of 90-days is treated by the CRA as having a presumed initial delinquency of 1/2017, adn thus an ultimate exclusion date of no later than 1/2024.  Specific reporting of the initial delinquency of 1/2017 will not affect that exclusion determination.

 

I would leave it be.  It is common and acceptable practice, and is not effecting the current level of reported delinquency, or the ultimate exclusion date.

 

Thanks RobertEG


 


Gardening until 6/6/2018
Message 3 of 6
New Visitor

Re: Nelnet late payment reporting

What about if the preceding months directly before the 90 show "ok" or "green"? Wouldn't that be bad reporting?
Message 4 of 6
Community Leader
Legendary Contributor

Re: Nelnet late payment reporting

Technically, yes, that argument would likely have merit, as it is inconsistent to report a payment history non-delinquency value for a month that is included within the chain of account delinquency.

However, it is not something that has been contested via any civil action, and thus there is no case law precedent that legally establishes such an assertion of inaccurate/incomplete reporting.

 

You can certainly chose to become a trailblazer and file a civil action, thus establishing case law precedent that such reporting is inaccurate.

Message 5 of 6
New Visitor

Re: Nelnet late payment reporting

Thank you for your response.
Message 6 of 6