No retroactive default, right?

[Anonymous]

My wife and I were keeping her last student loan open as it was her only installment loan. We recently read about the practice of putting student loans into default upon cosigner death. The cosigner died years ago. To be safe, we just paid off the loan. I'm I correct that Navient cannot retroactively put the loan into default after it has been paid and closed?

[Anonymous]

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@Anonymous wrote:

My wife and I were keeping her last student loan open as it was her only installment loan. We recently read about the practice of putting student loans into default upon cosigner death. The cosigner died years ago. To be safe, we just paid off the loan. I'm I correct that Navient cannot retroactively put the loan into default after it has been paid and closed?

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not that I am aware of, but we should wait and see for some more knowledgable peeps to come along, like @calyx , or @Anonymous .

Good luck and fingers crossed nothing becomes of it!

[calyx]

Typically, when we see something appear/disappear on a report, it's automated (and I can't see any reason why something would appear through that) or triggered (usually by someone doing an ill-advised dispute).   I think as long as nothing happens, you should be fine.    And it sucks that you lost the open installment loan bonus, but it sounds like you may have dodged a possible bullet.

Definitely keep proof of the paid-to-zero loan easily accessible just in case, but I wouldn't worry about it.

[Anonymous]

Thanks.

The other option we were considering was the co-signer release process. My wife would easily qualify. We decided against it to avoid poking the bear and potentially having to disclose that the co-signer had in fact been deceased for years.

[Anonymous]

I don't think they put the loan in a default status because those payments have been made. However, there might be an issue if the payments counted and in that case you might have an issue. 

I understand your thought process. I would be tempted to do the same thing, thinking you're avoiding telling them something they really don't need to know. But you're not. When you took out the loan you signed a contract. In that contract, it probably tells you what you're supposed to do in the circumstances that the co-signer passes. This is not optional to follow. I would tell them and see what can be done about it now, whether they will accept it as paid or something else has to be done. Just because they have the money didn't mean worst case scenario they can't make a big deal out of it and send it back. 

At least that will give you a definitive answer. 

Best of luck.