Rehab woes with Florida DOE, any options?

[Anonymous]

I accepted to go into a student loan rehab program with Allied Interstate.  The guarantor, Florida Office of Student Financial paid off the defaulted loans. 

Of course, now that I complied fully with the rehab agreement, Florida DOE cannot find a lender to buy the student loans from them and I can't complete the rehab.  They suggested giving them more time, but I would like to submit a mortgage application and I have to resolve this before I do, since I want to take advantage of the new real estate tax credit and close on a home before the end of the year. 

I have the option of consolidating the loan with Direct Loans, but Florida DOE will not remove the default as they promised to do when I entered into the rehab plan, since they will not be the ones finding the lender.  I think that sucks because I kept to the agreement. 

My question here is, what difference should it make to them who obtains the funding for the loan.  I made the payments, and stuck to the agreement.  Why wouldn't the DOE remove the default under these circumstances.  I understand thier unwillingness to do it if I took it upon myself to consolidate, but that's not the case, we had an agreement, and they failed to perform.    

[PayingTheBills]

I'm in Florida too, and recently had the same problem.  It only took an extra month for them to find a lender, and then everything happened as promised.

[Anonymous]

May I ask who the "new" lender is. I am in Mass and the agency that I've been paying my "rehab" to told me the lender backed out and still waiting. This happened in December. I'm desperate to get the credit cleared etc and wondering which lender is buying the debts.

[LynnInMN]

The rules of rehab are governed by the Higher Education Act.  Technically there is no such thing as a rehab "program" per se ...the act of rehabilitation occurs when your loan funds.  You make 9 payments on time and your loan is rehabbed.  Unfortunately in these economic times, lenders are not willing to pick up these loans due to the high re-default rate.  They are just too much work.

[PayingTheBills]

Sallie Mae

[Anonymous]

Well, now here's something else,  I just got off the phone with DOE checking on my consolidation status.  They told me that they normally see the LVC (Loan Verification Certificate) in the system withing 48 hours of the Guarantor, or Lender sending it to them.  Allied Interstate, the guarantor's collection agent told me that this form was faxed to them on March 19.  So I called them back, and an Allied Representative told me that Florida updated that information on the system, but had not actually sent the forms.  The Allied representative told me that this was not the first case they've heard of recently.  Seems like some over at Florida DOE are not doing, or being asked not to do their jobs.  LinnInMinn, is there someone that oversees these agencies, some regulatory board that I can ask to investigate these issues.  Seems like they are not only unable to find a lender, but they are fouling up the loan consolidation process as well.  I'm fuming right now

[Anonymous]

I will tell you that I work closely with DOE on consolidations and I can tell you that this is an ongoing problem. I've submitted prom notes and other forms via UPS (with confirmation) and they "disappeared"...Good luck

[Anonymous]

Thanks for your insight mbrube, this is troubling.  I understand that it was my doing to get into this situation in the first place but I am trying my upmost to make this right.  It's just troubling to me what big corporations get away with while all the while, average citizens, trying to correct past mistakes, have to navigate all hurdles placed in their path.  It's stressful and aggravating.  Sorry for the rant. 

[Anonymous]

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@PayingTheBills wrote:
I'm in Florida too, and recently had the same problem.  It only took an extra month for them to find a lender, and then everything happened as promised.

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Just wondering, how many months did it take before your rehab was finally funded.  How many payments did you have to make prior.  I'm on my 13th.

[Anonymous]

Same issue with my fiance's loan and he's from MA.  No one to take the loan they say.