New reporting requirements?

[Anonymous]

FedLoan Servicing informed me that they have a new requirement to report total debt, including interest that has not capitalized. Previously the amount owed would stay the same until capitalization, but now the loan amount changes monthly.
I'm not sure to trust FedLoan Servicing about this (you know how the servicers are!). Did anyone else notice any irregular balance changes on their credit report(s) or hear about this change?
Thank you

[topgunvf]

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@Anonymous wrote:
FedLoan Servicing informed me that they have a new requirement to report total debt, including interest that has not capitalized. Previously the amount owed would stay the same until capitalization, but now the loan amount changes monthly.
I'm not sure to trust FedLoan Servicing about this (you know how the servicers are!). Did anyone else notice any irregular balance changes on their credit report(s) or hear about this change?
Thank you

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This is interesting. I haven't noticed a change yet. This could affect manys DTI though for sure depending on the amount of loan tradelines and debt still owed. I'm going to follow for sure and hope that @RobertEG can provide his expertise and clear up the legality of what FedLoan is proposing. Best of Luck and keep us posted!!

[Anonymous]

Topgunvf: I want to say it's not true because you'd think there would have been some sort of notification. Regardless, they are reporting my interest monthly even though it's not being capitalized. I don't even think I can dispute it with the bureaus because I actually owe it.

I'm still trying to contact someone at FLS or Dept of Ed who can point me to some regulation or change in rules. I'll keep you updated.

[topgunvf]

Yeah I wouldn't dispute as its not necessarily causing an impact on your scores or DTI? But I am curious as to how this occrred and wish @ RobertEG could shed some light. He seems to have the rule for it all....😎

[pizza1]

Ive summoned @RobertEG for everyone

I also have FLS for my loans too, and not received any notification regarding this, and have not seen anything out of character in reporting either. 

[topgunvf]

Pizza you're the best! 😎

[Anonymous]

This may explain why both my wife's and my student loans respectively are showing higher than what the original balance is even though we are on Income Driven Repayment plans.  We went through a Ch7 BK and after a 6 month period after discharge the student loans showed back up with our IDR payments but with higher balances.  Is there any way to get FedLoan to correct this?

[Anonymous]

TexasFamMan:
Has the balance that's being reported to the bureaus increased every month since you've been on your IDR plan? Also, which plan are you on (ICR doesn't qualify to not capitalize)?
There is a solution but I haven't done it yet because I'm end-of-the-year busy and just fixed their last mistake (gave me two monthly payment amounts). I'll go to the CFPB later if I continue to get non-answers from them.

[Anonymous]

I have an answer now. They're lying.
I was checking CK for the inquiry from the dealership and the "what's changed" section scrolls down now to show changes previous months.
Although my payments to FLS don't change, they are reporting increases in my loans that vary to the extreme each month. As in one month a single loan's interest is $1, the next month it's $46.
It's crazy.
Thank you for the help. If not for your responses I might have believed them.

[Anonymous]

I was finally able to get an answer to the question (in general, not why mine are all over the place):

"PHEAA recently made changes to our credit reporting logic to reflect the total amount of outstanding debt. This change does not impact the total amount owed, but does include the total principal balance as well as any outstanding interest. Since we are now including the total amount owed, the credit bureaus may be reporting this as an increase in your balance."