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Rehab complete... But...

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Valued Member

Rehab complete... But...

My new servicer has reported my loan rehab on my credit report... instead of showing as 6 separate, it shows as one but in good standing.

Now, I know it's being reported as in good standing, but I have a question about the ones showing as in collections from when it was in default.... Will those just disappear completely? Is it possible to upload a screen shot to show what I'm talking about? I know I read that negative aspects get deleted once rehab is complete, I'm just still confused as to what disappears...
Message 1 of 15
14 REPLIES 14
Senior Contributor

Re: Rehab complete... But...


@Bellasmom15 wrote:
My new servicer has reported my loan rehab on my credit report... instead of showing as 6 separate, it shows as one but in good standing.

Now, I know it's being reported as in good standing, but I have a question about the ones showing as in collections from when it was in default.... Will those just disappear completely? Is it possible to upload a screen shot to show what I'm talking about? I know I read that negative aspects get deleted once rehab is complete, I'm just still confused as to what disappears...

To clarify:  In a successful rehab, the default disappears, however the lates may stay on the report.  While it is not guaranteed that the lates will disappear, many times they do.   When was the date of first delinquency for the old, defaulted loans?  If it was longer than 7 years, they may delete entirely.

It sounds like this is a single new tradeline with your new servicer - did you consolidate?

It might take some time for the defaults to disappear from your old servicer/agency (student loan servicers are notoriously slow about reporting).  If you are concerned, I would definitely give them a call and see what their policies are/how long it will take them to remove the default/s.

Nov 2019


Garden goal: keep on keepin' on
Usually a faithful practitioner of AZE5or6or7; working on AZE1or2 and grumbling about it.
Message 2 of 15
Valued Member

Re: Rehab complete... But...

My date of 1st default was around 10/2015 if I remember correctly. 

 

No, I didn't consolidate... I actually paid off a measley $9 loan so that it would show as paid in full to get any possible benefit I could from that, so I'm a little irritated that they're reported as 1 instead of 5.... Should I ask them to report it as the 5 instead of the one $3700 tradeline since it wasn't consolidated? Or could it be because I'm doing the $5 monthly plan based on income?

 

Currently I have 12 student loan tradelines... The one with my current servicer... 5 with US Dept of EDU stating they're in collections (loan amounts aren't reported right either, more on that later). And 6 with Fed loan servicing... One was a $0 loan that was canceled but still showed up as paid in full... The other 5 loans are marked as 120+ days late and that they're closed because they were sold or transferred... Can I expect that to be updated as well? They were sold/transferred because they were in default! 

 

As for the 5 tradelines from US dept of EDU.... 2 of the original loan amounts are reported correctly.... However, 3 of them state the original loan amount was $8 and they now have a balance of $1k+... I've beeen denied credit because of this and I only recently discovered this error, but they were reported that way from the day US Dept of EDU took them over from Fed loan servicing. Should I contact them and ask them to fix this error?? Original loan amounts that aren't reported right are more like 857 and 905, NOT $8!!

Message 3 of 15
Valued Contributor

Re: Rehab complete... But...

Technically, there isn't a difference between the original loan balance being $8 or 800 because either way, if the loan balance is $1k you've gone over 100% utilization. I don't believe there are any extra points lost. If you were denied credit for anything related to this it was because you have multiple loans with high utilization, or especially if you were in default then. This is not taking into account the rest of your profile and the fact that some creditor may still turn you down after the rehab with those lates.
I have seen where a couple people's loans were reduced in terms of number of tradelines, but never from 5 to 1. This sounds like consolidation. Did you make the 9 payments? Also, you can and should ask the collection agency for copies of any paper work, especially the one that says you've completed the rehab. When you started it they should also have given you some paperwork where you agreed to rehabbing. These might be needed later on.
After confirmation that you rehabbed with the collection agency, I would just wait a few and see how everything settles on your reports and scores. Then you can decide whether it's necessary to file a complaint with the student loan Ombudsman or the CFPB to have the corrections made.
If you don't have a credit monitoring service, the $1 trial at creditchecktotal is helpful (don't forget to downgrade to the free plan - desktop site, FAQ) . You could do it now and again after everything reports to see the difference.
Hope this helps.



Message 4 of 15
Valued Member

Re: Rehab complete... But...

I definitely DIDN'T consolidate my loans. Should I contact them and ask them to report them all separately? Wouldn't it be better to have 5 reporting as current and 1 paid In full?

Also... they're currently ONLY reporting to Equifax... can I request they report to all 3?
Message 5 of 15
Valued Contributor

Re: Rehab complete... But...

As described above, you've got to go back and figure out what they did. Check your paperwork. I think the National Student Loan Database should also list if you rehabbed it or consolidated. I've never heard of 5 loans becoming 1 with a rehab.
You cannot simply ask them to report them separately. I would however ask them for an explanation why only one single loan (does it show up as new in your credit report?) reports now. Once you determine what the problem is it will be easier to fix.

I do think it's something worth fixing. First, because I don't think that was supposed to happen and leaving the financial error alone could end up being a bigger mistake later. Second because having these multiple older tradelines will pad your account so your age isn't affected nearly so much when you apply for new credit. Mine barely budged when I applied for a few cards one year.

You also just finished the rehab so is can take a while for them to report on your credit reports. It's a slow process. If it didn't show up in a few months, then I'd take action.



Message 6 of 15
Senior Contributor

Re: Rehab complete... But...

Sorry for disappearing there - definitely +1 to everything Sabii said - Check your NSLDS and see what it says.  If there's nothing about consolidation there, you can wait to see how the report shakes out, or call them to double check now.

And I would want those multiple old tradelines back.

Nov 2019


Garden goal: keep on keepin' on
Usually a faithful practitioner of AZE5or6or7; working on AZE1or2 and grumbling about it.
Message 7 of 15
Valued Member

Re: Rehab complete... But...

Just went through all the papers about the rehab... Nothing about consolidating them in the end. Also checked the NSLDS, nothing on consolation there either.

The old tradelines still show as separate, just not the new ones. I'm going to give them a call in a little bit and see if they report to all credit bureaus and what they say about the one new tradeline instead of 6.

They also just approved me for a $0 monthly RPAYE plan. Should I pay what I can afford to every now and then? Or will that make them want to change my plan?
Message 8 of 15
Senior Contributor

Re: Rehab complete... But...


@Bellasmom15 wrote:
Just went through all the papers about the rehab... Nothing about consolidating them in the end. Also checked the NSLDS, nothing on consolation there either.

The old tradelines still show as separate, just not the new ones. I'm going to give them a call in a little bit and see if they report to all credit bureaus and what they say about the one new tradeline instead of 6.

They also just approved me for a $0 monthly RPAYE plan. Should I pay what I can afford to every now and then? Or will that make them want to change my plan?

Paying extra should in no way effect the plan you are on as long as you make your "regular" payments on time.  I would call to make sure they won't do anything stupid since it's a $0 plan, though (like have you 'paid ahead' on nothing), if it will affect any forgiveness options (Sabii would probably know more there)

Nov 2019


Garden goal: keep on keepin' on
Usually a faithful practitioner of AZE5or6or7; working on AZE1or2 and grumbling about it.
Message 9 of 15
Valued Member

Re: Rehab complete... But...

Just got off the phone with them... They said it's one account with multiple disbursements so its reporting my entire balance and they can't be reported separately. Does this sound accurate?

They also said that they report to all 3 credit bureaus but can't control how long it takes for them to update. Hopefully it won't take to long... trying to refinance a pretty steep car payment and likely wont be able to until its reported to all 3 and score goes up a bit across the board. I've only been able to check scores with free score sites, so I know they're not as accurate as FICO... but there was an 8 point jump on Equifax score as soon as the positive tradeline was reported.
Message 10 of 15
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